TODAY - The Newspaper for Country St. Maarten
Published On: Wed, Sep 27th, 2017

Economic impact

It is impossible to estimate the economic impact of Hurricane Irma on St. Maarten right now. That the impact will be severe is obvious, but how bad is it going to be?

With 80 percent of the room inventory destroyed, stay-over tourism will collapse. Cruise ships will not come to the island as long as its infrastructure is in a shambles.

If the island is gonna miss, say, 500,000 cruise passengers over the next six months, the local economy will see roughly $90 million go up in smoke, based on an average spending of $180 per passenger.

The government will miss the turnover tax on that number – $4.5 million. But the local businesses whose livelihood depends on tourism will be hurt the most – restaurants, hotels, cab drivers, fuel suppliers, food and beverage suppliers – the list goes on and on.

The effects will also be felt in the labor market. Unemployment will go through the roof and yet all those jobless citizens will need food and a roof over their heads. Companies will fold or continue with a skeleton crew, awaiting better times.

We have therefore tough times ahead of us and everybody will have to get used to a different and more frugal lifestyle.