THE BONAIRE ECONOMIC NOTE 2008 doc

During the first half of 2008, the Netherlands continued to grow showing an increase of 7% compared to the same period in 2007.. There was a strong increase in departing International pa

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DEPARTMENT OF ECONOMIC AND LABOUR AFFAIRS ISLAND TERRITORY OF BONAIRE

TABLE OF CONTENTS

B Monthly Arrivals, Arrivals per Region, and Arrivals per Length of Sfay TQ QQQ HH HH HT TT TT Tn TK HH nen nà 6

D Arrivals per Region, Monthly Arrivals —- Comparison 2007-2008 Q0 0Q Q00 e ened cE EEE Hea eed e eee ce EGE EE EEDA EA EEE EES 8

BONAIRE INTERNATIONAL AIRPORT (source: BÌA) - -. con HH nh ng ni HH mm HH KH Ki mm nh KH ng HH hư 10

B Aircraft MOVEMENT EEE EEE EEE EEE EEE EE EEE EEE EE EEE EAE EEE EEE eae ead eat eda EeEetEEEES 12

HARBOUR (source: Harbour and Piloting Department) cccccceeeece eens eee e eee e eee eee nnn ene ne renee enn ne ee ees eeeasaeseeeeaaeaaeeesessaneneeees 14

A Number of ShipS =oa nh iiẳiaađiẳiiiẳẳiiẳiẳiiiiiầaiảảăảä 15

B SHIPS Bonaire IN GR cE EEE EE EEE EEE EE EE EEE EEE EE EDEL DEES EEE EEE EE EEE E EE EEE EEE EEE EEE SEED E EEE EA Ea dea ttHeH Gana eaE EE ES 16

PIN C—10 [E11 — 1 Ik Ot | 0 | 0 e- ad a <a ằ ằẶ AAAA 18

POPULATION (source: Registry and Census Office ) -.- on HH HH HH nh HH KH HH Ki Ki nh Bì KH ĐH TH kh ung 25

a Business Licenses Requested and Processed 00000000000 n1 n TH HT HT ng ni ng ca 34

b Specification of the New Business Licenses Requested per SeCfOr L0 Q00 0Q 2 ng ng HE TH ky 35

c Beverage and HORECA Licenses Requested and Processed Q.0 Q00 Q0 TH ĐT TH HH kh nh nh nen 36

d Director's Licenses Requested and Processed 000000002 2n ng TH HT n n n TH ng ng gen cu 37

a _Registration of Job Seeker lnscripfiOnS c0 Q00 000002 212021 21 n1 TH ng KH KT kh ng gu 41

b Total number of Job Seekers per Age and Gender -.-. 00000202 gỀ HH HH nh kh he nhe 42

d Job Seekers per Level and Field of Education -.- c2 C0 0002020202 212 211 1n ng nh TT KT nh kh nhe he 44

f Registered vacancies per Level and Field of Educafion - 0000200002202 2n n2 ng ng chu 46

g Number of vacancies filled per Occupational Group and Business Secfor Q00 SH HH HH Tnhh nen 47

| Work Permit First and Short Term Requests per Economic SecCfOï cceceeeeceeeceececeeeeeseeseeeeeeeeeeeeeeeeseeeneeaaaaaeaeeeeeeeesenes 55

m Work Permit First Request per Field and Level of Education 7002002200100 22 11110 111111 2111 c1 TT ng nen 56

0 0 2 « aaaAaaaaaidđaiaiẳẳiẳiẳiaddddddiiiẳiaẳẳiaẳiiẳiaiaẳaẳadiiiiiaắáắäáắẳaẳẳọ 63

8 CONSTRUCTION (source: DROB) -.- HH nh Km Hi mà Họ họ Họ Ki Bì Hi Bàn HE kh vn In 64

B Construction Permits per MOnth 00 ccc ccc cece eee nn eee dai a—a- 66

D Construction Value 2005-2008 ooo ccc ccc cne cece ee cena eset eee nee eee tea vaeaeee ee teaaeeeeevengataeeevnveanetteevgeeeeeteneaeeetetenneaneevnvenanes 68

E Construction DUCES 0 cece ccc e ee cence eee eee ea sees eee nae atte te tea naeeeeevnnaeaeeeeevaeaeeeeeteaeeeeeveanaeeee evn vnaneeeeevgeaeeeeetunaeeeeveetneetaeeaaes 69

9 DEPOSITS AND LOANS (source: BNAI)) -.- ng HH TH Họ ng KH DI BE 98800 4 1 BE SE 1E 8 0n 1 BE E0 4.015 080800 1.1 BE SE T3 11x 888 4 71

BNA: Deposits and Loans BOnalre 0.0 ccc ccc ccc aẽ-( 72

CPI Bonaire 200-2008 ccc ccc ce cece ee eee a ee eee eee nae anette vaeeee eee eaeaeee ee teaeaeeetetenaeaeeetnveaeeeeeteaeeteeveneateevetenetanetvnngnneneenanes 74 À0 II) PTH(({(/Ạ(« aa)IIiiiiiiiiiiiiiid 75

11 GROSS DOMESTIC PRODUCT (Source: CBS) ccccccccce cece cree een nnn ne Re ee eee eee 76

GDP by Sector and Industry, 2000-2008 Q.00 0000002 212 211cc ng no nh HE KT ng ng TH ng nh nh ky f7

(FT :YY 4,909 -:/ 9a eo 6 i0 ¬a/ 000.019 7:i:.: 5 80

| Bonaire Restaurant AssociafiOn -c c0 00 2211 ng ng TH TT KT TK TT KT TK Tu TK TK TK TK TK TK KT TK TK TT TK cty kh kh ra 81

II Bank ASSOCiafiOn - c0 0n TH ng TH TT TT HT TT TT Ki TK TT TT KT TT TT Tu TY TT ki KT TK TT TK TT KT TK TT TK TK TT Thy ch ch cv n 82

IV The Bonaire Economic PlaffÍOrm -. . - c0 ng n HT n TT n TT ng ng n kg k n kg K n k KHE KT KT ng ng tk vn vn vn vxy 85

1 TOU RISM (source: Tourism Corporation Bonaire)

A Total Arrivals per Country

YTD Totals YTD Totals %

Average Length of Stay 11.93 9.40 8.75 9.53 9.10 8.52 9.97 8.49 8.74 8.69 9.00 10.25 9.36 9.87 5.35 Occupancy Rate 90.00 83.00 74.00 83.00 63.00 62.00 72.00 56.00 48.00 57.00 66.00 59.00 67.75 79.25 16.97

Cruise Passengers 2007 10.425 11.430 10.269 12.122 4.129 681 395 947 886 3.604 19.474 23.273 97.635

B Monthly Arrivals, Arrivals per Region, Arrivals per Length of Stay

Jan Feb Mar Jul Aug Sep Oct Nov Dec

Total Arrivals per Region

35000

30000 fj 2005 0)

Average Length of Stay, Comparison 2007-2008 14.00 w 2007 12.00

C Cruise Ship Passengers, Cruise Calls

Cruiseship Calls per Month 2005-2008 30>

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Total Cruise Passengers by Comparison 2005-2008

D Arrivals per Region, Monthly Arrivals — Comparison 2007/2008

Tourism Corporation Bonaire

Following the significant growth - particularly of the North American market - in 2007, Bonaire marked an incremental growth in tourism for the year 2008 of 0.04% overall, with total arrivals up from 74,309 in 2007 to 74,343 in 2008

North American visitors grew by 1.45% in 2008, up from 33,201 in 2007 to 34,291 in 2008 The most significant increase came from Canada where there were 18% more visitors in 2008 American visitors continue to be Bonaire’s largest tourist market, comprising 43% of the Market Share The strength of the international dive travel market (even in light of current economic challenges), the strength of the Canadian dollar, and the availability of additional lift from the US to the island, which also provided online connections from Toronto and Montreal can all be attributable The inauguration of Delta Air Lines weekly Saturday non-stop flight from Atlanta in mid-February 2008 along with the Wednesday Delta flight from Atlanta which operated during February, March and April provided an increase in airlift when compared to 2007 Continental Airlines’ second Houston flight on Sundays which operated in January, February, March and April, as in 2007, added to the weekly Houston and Newark flights on Continental and the daily flight on American Eagle provided a multitude of options for visitors traveling from North America

The growth slowed to 2.56% during the summer months due to a softer-than-normal July, most likely driven by the quickly deteriorating US economy, as the only airlift change during this time was the cancellation of the short lived Wednesday Delta flight from Atlanta The last four months of the year were severely impacted by the market collapse in the US triggered by the September 15, 2008 bankruptcy of Lehman Brothers and a steep decline in consumer confidence and spending power; September and October were further impacted by the historic trend of Americans not traveling abroad in the two months leading up to a Presidential election In addition, the annual seasonalization of the second Houston flight for the months of September, October and November and the cancellation of four American Eagle rotations starting in September also contributed to the downturn in arrivals The inauguration of the Delta JFK-BON in December was too late in the year to have a significantly impact on annual numbers and 2008 ended with an annual growth in arrivals of 57%

The Dutch market saw a growth of more than 20% in 2007, mainly attributable to additional seat capacity thanks to ArkeFly, which was expected to continue through 2008 During the first half of 2008, the Netherlands continued to grow showing an increase of 7% compared to the same period in 2007 Overall, the European market showed an increase of 3% up to the first half of 2008 As expected, the US financial crisis had its consequences for the European and consequently Dutch economies during the final quarter of 2008 Tourism arrivals from Europe showed a decrease of 2% by the end of 2008, although the Dutch market was not affected and maintained virtually the same numbers as 2007 The Netherlands continues to be the holder of Bonaire’s second-highest Market Share with 31.92% in 2008, which remained relatively unchanged from 31.88% in 2007

Brazil -South America’s primary diving market—- had an increase of 26.7% in 2008, followed by Colombia with an 11.5% The sustained promotional efforts conducted by TCB, the various accommodation properties, and the improvement of the connecting flights to Bonaire have all led to a continued growth and emphasize the potential of this huge dive market On the other hand, Venezuela -South America’s main tourism market- shows a decrease of 13.9%, and secondary market Ecuador decreased by 6.3% Overall, the South American region showed a decrease of 4.15% compared to 2007, down to 4,370 visitors in 2008 compared to 4,559 visitors in 2007 Venezuela continues to be affected by the exchange-control system The U.S dollar continues to rise which makes accommodations in Bonaire slightly more expensive than previously Bonaire continues to be the favorite diving destination for groups travelling throughout the year, and continue to make efforts to visit by chartering their own planes

2 BONAIRE INTERNATIONAL AIRPORT ource: aia)

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Scheduled 70193 71889 65203 60739 -2.36 70388 72501 64757 61397 -2.91 140581 144390 129960 122136 -2.64 Non-Scheduled 26827 21069 23313 19782 27.33 27731 21712 23449 20302 27.72 54558 42781 46762 40084 27.53 Non-Commercial 333 424 416 523 -21.46 596 734 668 798 -18.80 929 1158 1084 1321 -19.78 Total Domestic 97353 93382 88932 81044 4.25 98715 94947 88874 82497 3.97 196068 188329 177806 163541 4.11 Total Int'l/Domestic 171501 162879 148153 143412 5.29 171287 163162 148134 148540 4.98 342788 326041 296287 291952 5.14

Domestic 54.45% 54.60% 54.70% 59.93% 55.43% 54.47% 55.69% 60.10%

& Freight Total

Air Taxi* Non-Scheduled

Other General Aviation

=100.00

=100.00 11.96 30.33 22.30 22.30

=10.56

=90.99 1020.00 -60.71

=16.50 17.90

Landing and Parking fees aviation

BIA

2008 was a year in which the financial results of BIA N.V improved This was mostly due to measures which raised income for the airport, such as: the introduction of a security charge and at the end of 2008 a service charge, new car rental concessions, and paid public parking An increase in the number of departing passengers also contributed to the positive financial results of 2008 Beginning January 1, 2008, the airport tax for all departing passengers was raised Additionally, starting December 1,

2008 a service charge of NAfl 3.00 per passenger was introduced, thus the departure fees now include security fee of NAfls 2.50 per passenger, and a service charge of NAfls 3.00

As of December 1, 2008, total tariffs for airport tax for departing passengers (per passenger) were:

NAfl 63.10 for international destinations

NAfl 15.50 for local destinations with a reduced tariff of NAfl 10.50 for those 60+ and under 12

The total number of passengers increased to 168,600 in 2008, up from 158,500 in 2007, which is an increase of 6% Of these total passengers, 72,400 were international and 96,200 local There was a strong increase in departing International passengers during the first eight months of 2008; however, from September onwards there was a reversal due to the financial crisis, American Eagle’s reduction of flights to 3 per week, and Schipol airport’s implementation of flight tax, to name a few

In 2008 there was a 25% increase in local flights compared to 2007, while international destinations decreased by 15% The increase in local flights was particularly owed to Insel Air and EZ Air, while the decrease in international flights was primarily caused by the cessation of air Jamaica’s flights to Bonaire and KLM and American Eagle reducing their flights

Expected developments in 2009

Due to the dominating financial and credit crisis and the developing recession, it is difficult to forecast 2009 With regards to departing passengers, BIA expects a gain of roughly 10% for international destinations, whereas local destinations are expected to remain virtually the same as in 2008 KLM has some flight reductions due to lower occupancy on its Quito flight In May 2009, American Eagle will stop its flights to Bonaire Uneasiness within the airline companies forces them to limit their number of flights

13

3 HARBOU R (source: Harbour & Piloting Department)

14

A Number of Ships Bonaire

Freight Local Tugboat Bopec Cargill Cruise Web/Fuel Loc Cruise Yachts Marine Light/Other Airport/Jetfuel

B Ships Bonaire in GRT

C Pilot and Port Dues

D Registered Cargo

35.000;

30.000 | 25.000 | 20.0003 15.0001 10.0001 5.0003 `¬¬¬¬¬

Registered Cargo

E Port Rights and Retributions

02007

15.000 | H2008 10.000 |

4 IM PO RT AN D EXPO RT (source: BNA, Bank of the Netherlands Antilles)

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Import and Export

BONAIRE IMPORT AND EXPORT (in Naf., Antillean Guilders)*

(excluding oil products)

IMPORT AND EXPORT BONAIRE 2008

In 2008 much more goods have been imported compared to the two previous years, in quantity as well as in value; in value, 61% and 13% more then in 2006 and 2007, respectively and in quantity, 27% and 31% more compared to 2006 and 2007, respectively This trend reflects a still growing economy on the island

The main import countries in 2008 were identical to the two previous years: the Netherlands and the USA However, their total share has been declining from 71% in 2006,

to 62% in 2007, and 64% in 2008 Thus, the share of the other import-countries is increasing, from 29% in 2006 to 38%, and 36% in 2007 and 2008, respectively The main countries in this category are: Venezuela, Japan, Aruba, China, Thailand and France

The trend of declining export has continued in 2008, now also visible in the value of the export This trend reflects the global economic crisis The USA is still the largest export market and is still growing, forming a share of the total export of the island of 21%, 35% and 38% in 2006, 2007 and 2008, respectively In 2008, the Netherlands has been replaced by Belgium as second largest export market Belgium is rapidly growing as an export market for Bonaire: 6% in 2006, 8% in 2007 and 14% in 2008 In contrast to the 14% market share of Belgium, the value of the products exported by Bonaire to the Netherlands amounted to only 6%, thus, forming the 5th export country, together with Aruba The 3rd and 4th positions are taken by Venezuela (8%) and Colombia (7%)

Although a prognosis is difficult in the ongoing worldwide recession, DEZA forecasts a stabilisation of the import as well as the export for the island of Bonaire in 2009

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5 CUSTOM DUTIES (source: Customs)

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Subtotal custom revenues 16.219.749| 13.100.366] 11.844.839] 8.409.963] 7.524.380| 7.025.602 24% 11% 41% 12% 7%

Total Customs Revenues G Total import

CUSTOMS

The figures of 2007 have been corrected which was necessary due to a technical error

In line with the still booming economy of Bonaire, the custom revenues are still increasing: 41% in 2006, 11% in 2007 and 24% in 2008

As the population and the amount of tourists are grows, more construction is taking place and more businesses are establishing on the island, and therefore more goods are being imported: from food, to building materials, to furniture and cars Even though due to the worldwide financial/economic crisis prices are decreasing (for example of cars), in total the increase of the quantity factor overweighs the decrease of the price factor

The establishment of large supermarkets on the island has caused a shift over the last few years when it comes to the custom revenues These supermarkets are importing directly from the USA and the Netherlands rather than through Cura¢gao This is an important contributing factor to the increased revenues of import duties for Bonaire The excise tax on gasoline has increased, but not as much as would have been expected from the higher crude oil and gasoline prices This is due the fact that the more expensive gasoline becomes, the less kilometres people are inclined to drive with their cars, thus trying to cope with their tighter budget

DEZA’s forecast for 2009 as far as the custom revenues of Bonaire are concerned, is at least stabilisation of the level of 2008, approximately NAfls 22 million

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6 PO P U LATI O N (source: Registry and Census Office)

25

B Total Population by Neighbourhood, 2008

Nawati Zuid, 264 Noord Salina, 965 Mexico, 191

Playa, 252

Lagun Hill, 62 Hato, 497

Playa Pabriba, 721 Guatemala, 2

Rincon Noord, 828

Antriol Pariba, 2.113 Rincon Zuid, 986

Sabadeco, 150 Antriol Pabou, 1.078

Sabana, 678 Amboina, 807 Santa Barbara, 287

Tera Cora, 1.202

2/

C Population by Age and Gender, 2008

Age Male Female Total Percentage Population by Gender, 2008 @ Female

D Births per Month by Gender, 2008

Male Female Total

E Births per Neighbourhood, 2008

ercentage o Jan | Feb | Mar | Apr | Ma Jun Jul | Au Se Oct | Nov | Dec | Total Total Births

Hato, 2 Amboina, 9 Lagun Hill, 2 Tera Kora, 10 Lima, 0

Mexico, 1 Nawati Noord, 1 Santa Barbara, 3

Nawati Zuid, 4 Sabana, 7

Sabadeco, 0 Nikiboko, 20

F Deaths per Month, Male vs Female

United States of America 114 6.90% HPeru

Trinidad and Tobago

United States of America

ECONOMIC AND LABOUE AFFAIRS soưee prz^)

33

A LICENSES AND PERMITS

a Business Licenses Requested and Processed

New Requests 2008 Change of Address 61 Change of Name 7 Change of Objective 14 Change of Legal Body 27

27

One-man business 13 New Business Licenses 269

1505

100 5 50+

Business Licenses re quesfed and processe d

b Specification of New Business Licenses Requested per Sector

c Beverage and HORECA Licenses Requested and Processed

Requested Granted In process Shelved Withdraw n

Beverage and HORECA Licenses per Type of Request

Bar Rest | Music | Dance | Beer Snack Domino Billard Liquor| Soc | Wholes | Take-out | Icehouse | Apartm.| Hotel | Accom | Withdr | Exten | Total

36

d Director’s Licenses Requested and Processed

3/

LICENSES AND PERMITS

Business Licenses

In 2008, there were 3% more license requests than in 2007 In 2008, there were 288 business licenses granted, 69 more than in 2007, which indicates the growth in amount

of requests has maintained its level of growth There were 29 requests for a business license which were denied, twice as many as compared with 2007

Of the 423 business licenses requested in 2008, 64% were for new businesses, 14% concern change of address, 4% concern one-man businesses, 6% change of legal body, 6% establishment of a new Branch, and the remaining 6% were for other reasons

In 2008, the majority of business licenses (148, or 35%) were granted in the sector of “Real estate, business services and education” This has been a consistent trend over the last four years The HORECA sector is one of Bonaire’s tourism pillars and is traditionally an important sector in which many business licenses are granted In 2008, there was fewer business licenses granted than in 2007 The moratorium on Chinese restaurants still exists

The number of business licenses requested in the sector wholesale and retail trade has increased throughout the year 2008 Comparing 2005 through 2008, this sector had

an extremely positive result and increased by 31% compared to 2007 The sector wholesale and retail trade represents supermarkets and any type of retail business

Beverage and HORECA licenses

The number of requests for Beverage and HORECA licenses in 2008 has shown a slight decrease compared to 2007 In total, there were 76 requests for Beverage and HORECA licenses, which is a 4% fewer compared to 2007 The 76 petitions for a Beverage and HORECA license in 2008 represent 12 different combinations of HORECA licenses or special written permission on the license(s); for example, a Bar and Restaurant license which has permission for organizing dances, domino, and billiard activities Of the 219 requests 2008, the majority of the type of requests for Beverage and HORECA were for: bars and restaurants, 93 or 42% and liquor stores, 21 or 10% The system of the granting of permits depends upon the advice and input of several government departments, including the fire department and the police DEZA is reliant upon these other institutions, and if their advice is not received the permit cannot be issued

Director’s licenses

Since 2005, director’s licenses are being registered separately Previously they were included in the business license requests Director’s licenses were only registered when applied for separately, such as in the case of a new director, or change of director 2008 noticed an increase of 24 requests, 44% more compared to 2007 The amount of requests in 2008 did not reach the level of requests seen in years 2005 and 2006; however, the trend is expected to continue rise in the coming years

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Number of Tax Holiday Requests Status of Tax Holiday Requests