Dear Editor,
The mega announcement of mega tariffs around the world took place in the Rose Garden on Wednesday, April 2, at the White House in Washington DC.
Trump’s tariffs have created economic anxiety and it’s already leading to a decline in U.S. consumer confidence which is impacting how Americans are spending their money. There has been a decline in spending on airlines, hotels and other trip components.
St. Maarten received over 332,000 stay-over visitors in 2024 and close to a million cruise passengers, more than a majority from the US market. Regional and local tourism reps will be watching the figures closely for 2025, but a strategy is needed to counteract the potential decline that we are facing as a nation.
In February, according to data from Bloomberg Second Measure, U.S. consumer spending on air travel and hotels dropped by 10 and six per cent year over year. In addition, from the same source, every week in 2025 through March 24, Americans have spent less on airfares and hotels compared to the same period in 2024.
The Central Bank of Curaçao and St. Maarten (CBCS) this week released its March 2025 Economic Bulletin which said that St. Maarten has demonstrated resilience by recording a stronger recovery from the pandemic than initially anticipated by maintaining steady economic growth throughout 2024, and this momentum is expected to continue into 2025.
St. Maarten’s real Gross Domestic Product (GDP) was described as “moderating slightly to 3.5 percent in 2024,” and CBCS projects that real GDP for 2025 is expected to expand by 2.6 per cent.
CBCS warns that “…trade policies by the U.S. administration could result in negative spillover effects for both the global economy and the monetary union (Curaçao and Sint Maarten).” CBCS further adds that, “This scenario may disrupt supply chains and cause sharp increases in international commodity prices, further fueling inflationary pressures in Curaçao and St. Maarten.”
CBCS: “To reduce risks from tariffs and potential trade conflicts, businesses in Curaçao and Sint Maarten should diversify supply chains away from reliance on the U.S. market. The governments of Curaçao and Sint Maarten can support this by strengthening trade relations with alternative partners through, for example, collaborative advocacy with CARICOM.”
According to the U.S. Department of State, U.S. exports to the country in 2023 was valued at US $847 million. This is what local import businesses, wholesalers and others forked out. The time has come to diversify our supply chains and our reliance on the U.S. market as suggested by the CBCS.
CBCS adds that, “… promoting local production in agriculture …,” is one of the avenues that should be explored and developed. The government of St. Maarten Ministry of Tourism, Economic Affairs, Transport and Telecommunication (TEATT) is pursuing this avenue.
With the tariff war now in full swing, small island nations like St. Maarten and others in the Caribbean will be planning a response while others may already have been planning ahead once Tariff Trump was sworn in 10+ weeks ago.
The tariff war is a wake-up call for St. Maarten’s tourism-dependent economy and sole reliance on the U.S. market for goods and products. The country’s economic diversification is more essential now than ever.
Roddy Heyliger
