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Country Report Curaçao 2nd Quarter 2018
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HTMLUpdate Country Report Curaçao 11 Apr 2018
Rising January and February tourism receipts boost prospects
Event
Tourism receipts rose by 2% year on year in the first two months of 2018, providing an economic boost after receipts and arrivals declined in 2017.
Analysis
In January and February 2018 tourism receipts totalled US$99.2m, up from US$97.7m in the same period in 2017. This was despite the fact that tourism arrivals declined by 1% in the first two months, to 74,180 visitors.
European tourists contributed 52% of the tourism receipts in January-February, or US$51.3m, underlining Curaçao's ongoing dependence on tourism from Europe and particularly the Netherlands. Arrivals from the Netherlands grew by 11%, from the US by 13%, from Colombia by 37% and from Brazil by 3%. However, despite this positive growth-these markets now comprise around two-thirds of total arrivals-overall arrivals continue to be dragged down by a sharp decline in inflows from nearby Venezuela owing to the fall-out from a severe economic crisis there. Although we do not expect arrivals from Venezuela to recover, especially amid ongoing bilateral diplomatic coolness, strong arrivals from Europe and North America should help to compensate.
Curaçao's government is aiming to diversify its tourism arrivals away from the traditional markets by attracting tourists from other regions. In this regard, on April 4th the government announced an "open skies" agreement with Qatar to allow unlimited air services between the two countries. (However, the Netherlands has raised some concerns that this could provide too much competition for Dutch carriers if Qatar Airways refuels and takes on passengers in the Netherlands.) In addition, the resumption of flights by a local carrier, InselAir, following a financial rescue package should help to increase intra-Caribbean tourism and also return Curaçao to more multi-destination tourist itineraries.
Impact on the forecast
An improvement in tourism arrivals and revenues supports our forecast (which remains unchanged) that Curaçao's economy will return to growth in 2018, when we expect it to grow by 0.3%.