Curacao and Sint Maarten 2011 Article IV Consultation Discussions
Preliminary ConclusionsSeptember 19, 2011
The two newly-autonomous countries face substantial challenges, requiring sustained efforts over the near and medium term. Economic growth has been low, unemployment remains high, and population aging pressures are becoming significant. The current account deficit has widened to worrisome levels, primarily reflecting low competitiveness, rapid credit growth, and inadequate pass-through of increases in international food and oil prices to consumer prices. Strong measures will be needed to facilitate external adjustment. Credit growth should be reduced to help cool domestic demand pressures. Strong fiscal efforts are required to address pressures related to aging and institutional build-up, and to support external adjustment. Deep structural reforms are also needed to increase wage and price flexibility and competitiveness, and to improve the business environment.
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