Sint Maarten Country Statistics

LOCATION

Sint Maarten encompasses the southern half of the island of St Martin; the northern half of the island constitutes French Saint Martin. The Island of St. Martin is part of the Leeward Islands and is 6 miles (9 km) south of Anguilla.

ECONOMY

Sint Maarten is an overseas territory of The Netherlands. Its economy shrank by 17 percent cumulatively over the period 2017-2018, after being struck by Hurricanes Irma and Maria in September 2017. Irma, a category 5 hurricane, was rated as the worst to hit the territory in century and was packing wind speeds of 182 miles per hour. According to the World Bank, the damage caused by the hurricanes was equal to 260 percent of the country’s GDP. With significant damage inflicted on the country’s productive capacity, unemployment increased, as all major sectors were affected, none more so, than the all-important tourism industry. In 2018, stay-over arrivals plunged by 55 percent, following on a 24 percent decline in 2017. Almost three years after the hurricanes, the nation’s recovery efforts continue to progress slowly, despite a €550 million pledge by the Netherlands to support reconstruction efforts.

In total, all tourism related activities are estimated to account for as much as 45 percent of the country’s GDP. According to the World Bank, the sector accounted for 73 percent of the country’s foreign exchange earnings in 2016. Other important sectors include the business activities and real estate industry, which accounts for 25 percent of GDP and commerce, which contributes 16 percent. The transport, communication and storage sector contributes 11 percent of GDP.

Economic activity rebounded in 2019, led by tourism sector activity, which benefitted from an 80 percent increase in stay-over arrivals. There were large increases in arrivals from all major markets, with total visitors from US increasing by 145.4 percent. Arrivals from Canada registered a 202.7 percent expansion, while visitors from Europe were up 22.4 percent. This improvement was facilitated by ongoing reconstruction activity, which restored portions of the country’s tourism infrastructure. However, it has been a gradual process. According to the IMF, cruise tourism has already recovered to pre-hurricane levels, but stay-over tourism had only reached 60 percent of pre-hurricane levels by November 2019. This is reflective of slow project implementation, which has resulted in only 60 percent of hotel room capacity being restored and only a third of the space at the airport being utilised. Nevertheless, the return to growth of tourism, provided some impetus for ancillary industries, such transport and storage, commerce and finance. In addition, ongoing reconstruction efforts continued to fuel activity in the construction sector. Overall, GDP is estimated to have expanded by 8.2 percent in 2019.

Government’s fiscal resources were severely strained in the wake of Hurricane Irma. According to the IMF, the country’s fiscal deficit excluding trust fund operations moved from a surplus equal to 1.4 percent of GDP in 2016, to deficits of 3.6 percent of GDP and 3.8 percent of GDP in 2017 and 2018, respectively. Similarly, public debt moved from 44.5 percent of GDP in 2016 to 54.4 percent in 2018. However, with the improved economic performance in 2019, debt fell slightly to 51.3 percent of GDP, while the deficit fell notably to 1.6 percent.

In the first three months of 2020, global fears surrounding the COVID-19 virus reversed a significant portion of Sint Maarten’s recent tourism sector gains. During the period, stay-over arrivals declined by 13.4 percent and the number of cruise visitors were down 35.1 percent. With global tourism jettisoned in the succeeding three months, the pain was intensified. Given the still unfolding events surrounding the virus, the growth of the sector is expected to be constrained heading into 2021. However, the country’s ongoing recovery efforts are expected to provide some stimulus for the construction sector, notwithstanding the risk of delays in key projects. In December 2019, the government and the World Bank signed a US$72 million grant agreement for the reconstruction of the airport terminal, which aims to restore full service at the territory’s Princess Juliana International Airport.