Curaçao: Country and Foreign Investment
Economy and Currency
This page was last updated on 20 August 2019.
The currency at the time of writing is the Netherlands Antillean guilder or florin (Dutch: gulden). The rate of exchange is fixed against the US dollar at US$1 = ANG1.790. There were plans to introduce the Caribbean guilder for Curaçao and St. Maarten at the same time as the Netherlands Antilles were dissolved. However, cost and logistical factors have delayed the introduction of the new currency, with further delays or the adoption of the US dollar a possibility.
Curaçao is not well-favoured with natural resources. Due to the lack of arable land and water, agriculture accounts for only around 1% of GDP. The economy is largely based on tourism, petroleum processing, transhipment and offshore finance. Almost all consumer goods are imported from Venezuela and the USA; as a result local inflation tends to reflect international levels.
After oil was discovered in Venezuela, the Dutch-British oil company Shell built the Isla oil refinery on Curaçao. This dominated exports until Shell left in 1985, closing the refinery briefly. The government then leased it to the Venezuelan company PDVSA. Things ran smoothly until Venezuela was hit by a political crisis, then ideological US sanctions. The refinery was closed down for eight months, and though it was granted an exemption from sanctions on 2 May 2019, is still deeply troubled.
The instability in neighbouring Venezuela and the resulting uncertainty over Isla has kept unemployment rather high and left the government in a precarious financial position. GDP is estimated at US$3.15 billion (2015), which gives a GDP per capita of $19,950. GDP growth effectively plateaued in 2012 and has since been negligible or negative. The island receives more than US$100m a year in aid from the Netherlands and international agencies.
The offshore financial sector began during the German occupation of Holland in the Second World War, when Dutch companies sought corporate and financial refuge, and has developed steadily ever since, giving Curaçao in particular a more sophisticated business infrastructure than most countries in the region. The island has a good natural harbour, and there is a ship repair unit.