IMF Staff Country Reports

The 2023 Article IV Consultation with the Kingdom of The Netherlands—Aruba discusses that economic activity rebounded strongly. Real gross domestic product grew by 27.6 percent in 2021 and further expanded by 7.3 percent in 2022, reinforced by the recovery of tourist arrivals following the lifting of the restrictions introduced during the pandemic. The economy is expected to grow at a moderate pace in 2023 as the post-pandemic rebound in tourist arrivals wanes. Inflation is projected to decelerate with slowing domestic demand and lower international commodity prices. Risks to the outlook are tilted to the downside. A steeper-than-expected global slowdown, especially in the U.S., could reduce tourist arrivals. Climate change is an ever-present risk through both rising sea levels and more volatile weather events. Domestically, risks to the outlook are largely related to the potential of insufficient fiscal adjustment. Increasing resilience to climate change is a priority. A concrete action plan for adaptation would help prioritize infrastructure investments that improve the physical resilience of low-lying areas.