The New Economy Post COVID-19
Just like the rest of the world, Curaçao also had to come up with a post COVID plan to face the serious repercussions of the COVID-19 crisis. With tourism, one of its main economic pillars paralyzed, uncertainties about the future of the oil refinery, stagnation in the trading relation with Venezuela and troubling public finances, the island has to be bold in its approach to turn the negative trend. Curaçao 2.0 will be a version of the economy build on economic resilience.
The effects of the global health crisis are immense for the island. The tourism sector, one of Curaçao’s main contributors to the economy, received a hard blow while other economic sectors came to a standstill during the quarantine. These effects came on top of the critical economic trend and the troubling public finances of the last years. These developments do not add to an encouraging outlook. In view of the magnitude of these challenges, the Ministry of Economic Development (MEO) decided to take this moment to design Curaçao Curaçao’s New Economy Post Covid-19.
An economic plan based on economic resilience.
The economic challengens are not uncommon for the small island developing states in the Caribbean. Tourism, one of the most lucrative industries in Curaçao affects many segments of the economy, that directly or indirectly depend on a thriving tourism market. Public finance, already in the red, is expected to continue deteriorating as government spending for the support of enterprises and workers increases, while its income through taxation and duties decreases. Countries all over face similar situations. However, many of these countries have reserves and more diversified economies, making them more resilient in the face of this downturn.An important objective for Curaçao is thus to diversify its economy and reduce vulnerabilities. In countries that were better prepared, technology has come to the rescue. Not only was there no negative impact from the pandemic on the tech sector, it is actually thriving. People continue to work- and do their shopping online. They interact with each other and do their physical exercise with the aid of technology.
This is a direction that Curaçao had already envisioned, in the Smart Nation concept. It is also the basic precept of the National Export Strategy (NES) that the government, with the assistance of the International Trade Centre, has engaged in. Curaçao has yet to exploit the potential that its good technological infrastructure provides. The NES identified a number of sectors that can grow, or be initiated, by using technology. These include sectors such as financial services, port & maritime services, creative industries, education services, tourism and indeed, information and communications technology services. A lot needs to be done at the policy, institutional and enterprise levels.
The NES demands a leading role by the government in providing improved and extended e-services to businesses and citizens. The aim is to achieve efficiency, to make it easy for businesses to do become more competitive, and to make Curaçao more attractive to investors. Both public and private institutions should be focussed to help businesses succeed. This is achievable through improved assistance throughout the companies’ lifecycles. Enterprises need to gear up by making more informed international marketing decisions and continuously keep innovating and improving their goods and services. During the past years, Curaçao has developed many strategies. Many of these were only partially implemented, or not implemented at all.
However, the government is now determined to introduce the NES, – the country has no choice. Change will take time, but results will be seen. And the next time Curaçao has to face a global adversity, it will find the island and its economy more prepared, more resilient.