Today, the Centrale Bank van Aruba (CBA) published its most recently revised GDP estimate and
outlook for, respectively, 2020 and 2021.
The CBA, recently, updated its economic estimates for 2020 based upon perceived economic
developments and available data up to and including October 2020. In 2020, the main economic
activity, being tourism, contracted significantly. Compared to 2019, a drop of 70.0 percent in stayover visitors is estimated for the year 2020, which would likely conduce to a 56.6 percent fall in
tourism revenue.
In addition, the CBA performed its first projections for 2021. Considering the persistence of
significant uncertainty in 2021 how the COVID-19 pandemic would further evolve, a baseline scenario
is presented, based on assumptions of the most likely developments with regard to various
important economic aggregates. In the baseline scenario, tourism is expected to continue its path to
further betterment during 2021. At end-2021, total stay-over visitors are projected to reach 60.0
percent of the 2019 level, resulting in a gain of 14.4 percent in tourism revenue. In addition to the
baseline scenario, both a pessimistic and optimistic scenario are included. The pessimistic and
optimistic scenarios deviate from the baseline in terms of the speed of the tourism recovery. The
latter impacts consumption, investment, and import and export levels.
In 2020, Aruba experienced a significant economic contraction; real Gross Domestic Product (GDP)
is estimated to have crumbled by 26.4 percent. The economic slump in 2020 follows a steep decline
in tourism activity, private consumption, and investments, triggered by the Covid-19 pandemic and
the measures taken by the government of Aruba to contain its spread.
The near-term economic outlook remains uncertain. For the year 2021, the CBA made its first
projections, in which the results are highly dependent on the depth and length of the pandemic and
the strength of the tourism recovery. The main driver of the resumption in economic activities in
2021 would be an improved performance in the tourism sector, as it is expected to remain on the
gradual path to resurgence. Nonetheless, tourism related activities are foreseen to remain well
below 2019-levels in all scenarios. Real GDP is anticipated to grow by 2.5 percent under the baseline scenario, and 5.2 percent in the optimistic scenario, but would shrink further, i.e., by 3.4 percent in
the pessimistic scenario.
