The assessment conducted by the International Monetary Fund of the economy of Aruba is complete, and it ends with an encouraging report of the financial course of this Caribbean country. The assessment shows the impressive recovery of Aruba during the pandemic and the elements that will create opportunities in the future for a sustained expansion of this region. The assessment takes place during a very important moment of the evolution of Aruba, since this island is developing its economic pillars based on the expansion of tourism.
Tourism-led recovery continues at a strong pace
The economy in Aruba performed very well with a real GDP growth estimate of 8.9 percent in 2023 and 7.6 percent in 2024, largely driven by private hotel investments and tourist activities. The rate of tourist stopover growth decelerated to 4.8 percent in September 2025, but the unemployment rate notably decreased to 4.3 percent in 2024 from an average level of 8.0 percent in 2000-19.
Headline inflation has eased substantially from a peak of 7.7 percent year-over-year in August 2022 to -0.4 percent in September 2025, driven mainly by a reduction in international food and energy prices, as well as Base Effects associated with administered prices and a strengthening US dollar. Forecasts for economic growth indicate a deceleration to 4.0 percent in 2025, driven by a slowdown in tourism investments and hotel investments.
The attempt to diversify economies acquires significance
While welcoming the adoption of a High Value, Low Impact model of tourism with increased shared value for society, the IMF underlines that “new engines of growth are needed, given the constraints on further tourism development in the ‘Promising Sectors’ initiative and the renewable energy plans.” The priority of resilience to climate change implies some concrete action related to enhanced resilient infrastructure and nature-inclusive urban development, especially with respect to coastal areas.
The fiscal framework offers a gradual approach to debt reduction
The public debt is projected to decrease substantially, settling at 64.4 percent of GDP in 2025 and further falling to 50.4 percent in 2030, with fiscal balances achieving the fiscal rules established in all forecast years. The current account balance is projected to remain in balance because of the constant inflow of tourist visitors, resulting in a level of international reserves that is adequate at levels of approximately 12.5 months of total imports. Complying with the fiscal rules will help lower debt to a level of 50 percent of GDP in the medium term.
The budget for 2026, which is presented to Parliament, is in line with the Financial Supervision Law but shows a slightly expansionary fiscal policy. In order to achieve a more neutral fiscal stance in aligning with closing the output gap and a further reduction in debt, savings are encouraged through revenue windfalls, with spending simplification being used as a fall-back option.
Improving revenue mobilization, efficiency in spending, and better targeting of public expenditure will aid in consolidating fiscal surplus and debt reduction achievements, which will in turn help in augmenting spending in important sectors.
Financial stability indicators respond to developing challenges
The Central Bank of Aruba must further exhibit caution with regard to liquidity management, taking into consideration, among other things, the existing level of global uncertainty and reserve requirement ratios, which support macroeconomic stability. It is prudent that elevated standards in real estate lending are closely monitored, in addition to incorporating macroprudential policies in this respect, such as LTV and DSTI ratios.
The significance of this IMF assessment of Aruba lies in emphasizing the exemplary performance of the economy of this Caribbean country, in addition to providing a strategy to sustain this performance. The debt level reduction plan of Aruba, along with a strong performance in the tourist sector and efficient fiscal systems, puts this country on a good platform to further improve its economy.
