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Friday, October 20 2017 @ 01:05 AM AST

Aruba economy expected to take off this year on refinery refurbishment

If realised, the projected 3.4% growth in gross domestic product (GDP) will be one of the highest in the Caribbean.

"Real GDP in 2017 is expected to grow by 3.4 percent, driven in large part by private investment activity related to the transformation of the oil refinery into an upgrader and commensurate consumption," the Central Bank of Aruba said in a report released today. For the full report, visit:

Activities in tourism service exports, the main driver of economic growth, were virtually flat for 2016. Overall visitor nights decreased by 4.3 percent in 2016, attributed mainly to a drop in Venezuelans staying at other accommodations (mainly private homes) while visitor nights of tourists from the United States, the main tourism market, showed a growth of 0.4 percent. Whereas tourism receipts were previously anticipated to decrease by 3.4 percent for 2016, the first three quarters of the year registered only a slight drop, prompting an upward adjustment to an estimated contraction of 0.2 percent for the year 2016 as a whole.

Notable large investment projects in 2016 included the Green Corridor and the renovations of the Dr. Horacio E. Oduber hospital, the Hilton hotel, and the Marriott hotel.

The Aruban economy is projected to expand (in real terms) in 2017 by 3.4 percent, driven in large part by the refurbishment activities of the oil refinery. Investment is likely to pick up, as some large projects, particularly in the tourism industry, materialize in 2017. Furthermore, the Aruban economy is expected to experience further deflation in consumer prices in 2017 driven by lower electricity tariffs, following deflation observed in 2016. While significant upside and downside risks persist for the 2017 forecast and beyond, the medium term is expected to result in a higher level of GDP, but with limited annual growth in domestic output.

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