Author Topic: Introduction of US dollar on Aruba, Curaçao and Sint Maarten under consideration  (Read 196 times)

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Offline eurocoin

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In a recently published document the Dutch government announced that it is going to commission an independent external party to hold an investigation into whether Aruba, Sint Maarten and Curaçao should keep their own local currencies or whether it would be better for them to introduce the US dollar. Based on the outcome of the investigation, the Dutch government is planning to take concrete measures. It is likely that the islands will then more or less be forced to do what is in the best interest of their economies.

The economies of the islands have been very weak for many years and the Dutch government has had to provide large amounts of money to keep everything running there. Major reforms are already being implemented and will continue to be implemented in the near future so that hopefully the problem is being solved once and for all. The islands are unlikely to have much choice as the Dutch government is eager to solve this problem and they remain reliant on Dutch aid for the foreseeable future. The situation has worsened now that tourism, their major source of income, has come to a standstill because of the corona virus outbreak.

Aruba currently uses the Florin. Curaçao and Sint Maarten currently together form a currency union using the Netherlands Antilles guilder. They are working on the introduction of the Caribean guilder which is planned to become the new currency of their union as of January 1, 2021.

In 2013 a report of the Social Economic Council (SEC) was released which mentioned that it would be better for the economy of Sint Maarten to leave the currency union with Curaçao. The introduction of either its own currency or the US dollar would have a positive impact on its economy, with the latter option being preferred by the SEC. Use of the US dollar is up until this day already widespread on Sint Maarten.
« Last Edit: September 28, 2020, 11:56:23 PM by eurocoin »

Offline redlock

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Based on the outcome of the investigation

Any idea when that might be?

Offline eurocoin

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Any idea when that might be?

It is unknown when it will be ready. I wonder what the impact of this will be for the aim of Sint Maarten and Curaçao to introduce the new currency on January 1, 2021. I guess they will have no choice but to postpone it again.

Offline eurocoin

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The research in regard of the possible introduction of the US dollar in Aruba will start in 2022 at the earliest.

It is not yet known when the investigations in regard of the possible introduction of the US dollar in Curaçao and Sint Maarten will begin.

Online brandm24

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I was curious as to what the benefit would be if they used the US dollar. It seems like it's already widely used there so that's a plus. It would strenthen the local economy because the dollar is readily accepted and stronger than their current currency? If that's the case then, it would make perfect sense to do so. It also would relieve the pressure from the Dutch government as you say.

Bruce
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Online Figleaf

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Since THE oil refinery closed, shady banking was ended under OECD country pressure and Venezuela sank into its home-made economic morass, tourism (including adjacent services, such as gambling, prostitution and drugs) has been the main economic activity in Curaçao. Tourism is a USD trade. Why bother exchanging the incoming money?

Peter
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