Aruba’s economy experienced a remarkable 11.2% expansion in the first quarter of 2024, with the tourism and construction sectors leading the charge. The island welcomed a significant 22.5% increase in tourist arrivals, resulting in higher tourist spending, despite a slight decrease in the average length of stay. This surge in tourism contributed significantly to the island’s Gross Domestic Product (GDP) growth.
The construction sector also played a pivotal role in the economic boom. Ongoing large-scale projects fueled investments and domestic consumption, contributing to the overall economic expansion.
Domestic demand, as reflected by increased utility usage and a 6.0% growth in goods imports, indicated a strong local economy, further bolstered by the construction sector’s activity.
While the investment landscape showed mixed results, there was a 5.6% increase in the value of new residential mortgages and a 4.2% rise in the importation of machinery and electrical equipment. However, the import of basic metals and construction materials declined, along with a reduction in new commercial mortgages.
Inflation trends in Q1 2024 were favorable, with the annual average inflation rate decreasing to 2.1% by March 2024. This decline, a drop of 1.3 percentage points from December 2023, was mainly attributed to lower utility tariffs, decreased gasoline and diesel prices, and stabilized food costs. The real exchange rate continued to improve, enhancing Aruba’s competitiveness relative to the US dollar.
In trade, the commercial deficit saw a slight increase, rising to Afl. 632.0 million in Q1 2024 from Afl. 607.5 million in the same period of the previous year. This was primarily due to a 4.1% increase in import values, driven largely by transportation goods, precious stones, and live animals, while exports grew by 5.2%.
