Island Economies and Regional Economic Resiliency

St. Martin was hit extremely hard by Hurricane Irma in 2017. The island, split between the French and Dutch, is still recovering in the waning days of 2019. Boats are still submerged in the bays, garbage is piled on the streets, and innumerable houses remain concrete shells.[i] The slow recovery coupled with policies on the French side has also led to social unrest. A few days before we arrived for a short vacation, some people from the poorest communities had blocked the roads by setting cars and buses on fire and leaving the charred shells in the street. Two of the main roads remained blocked over a week after the protests.[ii] There were no protests on the Dutch side.

A number of people said that the reason for the unrest is that the French government has allowed richer communities to return to the beach but was not offering poorer communities the same option. However, other reasons for the unrest mentioned by a number of locals included the government trying to buy back land at lower prices than offered elsewhere, the distribution of water, no advice on where displaced people should go, and general distrust or dislike between people.

While the protests may have been triggered by rebuilding policies, there also seems to be a slowly developing issue on the island–The two sides of the island are recovering at noticeably different speeds due to different government philosophies. Supposedly, the Dutch have been laissez-faire while the French are more involved in the rebuilding.

The difference in outcomes on the 87 square kilometer island is noticeable. The Dutch side seems to be recovering well with new hotels and generally cleaner streets. The cruise ships have returned to the Dutch side with tourists buying drinks on the (man-made) beach and renting jet-skis. On the Dutch side, there are a lot of little shops, each with an owner who has an incentive to rebuild. The French side has more trash on the streets and seemingly more vacant homes. There are no cruise ships dropping off tourists and half of the bars on the most popular French beach remain destroyed. There are a few bars open on the beach, but most remain destroyed. To be certain, both sides are still clearly struggling to rebuild, but the French side is not as far along.[iii] It does appear that the heavy hand of government is slowing progress on the French side.

While the short-run outcomes appear easy to see, it seems likely that the long-run outcomes are also beginning to be visible. It does not seem that the Dutch side is rebuilding for the next hurricane. At least on one popular beach, the bars serving the cruise ships don’t appear strong enough to withstand another hurricane. They are close to the beach, built almost entirely of wood, and are generally of low quality. The buildings being rebuilt on the French side are farther from the beach, more often built of concrete, and seem to be generally much stronger (even if mostly unfinished). The French appear to have learned lessons from Irma and are changing their strategy. The Dutch side has rebuilt as before. If another hurricane comes, I suspect that the French side would fare much better.

While the French side appears to be rebuilding stronger, the benefits seem to be more concentrated. A few well-built bars and restaurants serve all the traffic on the French side. There are numerous bars on the Dutch side, with owners of all stripes. The concentration of prosperity on the French side seems to me to a likely culprit of the unrest and subsequent “car-b-ques”.

What is interesting from an economic geography perspective is that the two sides of St. Martin (both hit extremely hard by Hurricane Irma) display clearly two forms of resiliency. The ability to bounce back is one form of resiliency, one that is perhaps best managed by the various actors with their individual interests as seen on the Dutch side. The ability to withstand a shock is another form of resiliency, one that is perhaps best handled by a central agent such as the government, as seen on the French side. Both seem to be reasonable strategies, even if they have their drawbacks.

While time will tell which side will cope best with an unpredictable future, it is interesting to watch them play out, with a margarita, of course.

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[i] We were told that Saint Barthélemy, the smaller and much wealthier French island, had 13 bulldozers to clean the aftermath of Irma compared with only 3 for Saint Martin. Given their disproportionate resources, Saint Barthélemy was mostly back to normal within three days.

[ii] The protesting population did not seem to be acting in malice. They seemed just to want their grievances heard. One protester we met at a bar told us he felt bad that this was going on while we were here (we didn’t mind). In fact, the main road between the two sides was not blocked, the protesters had a strategy and it was NOT to completely disrupt everything. Also, it was interesting that some guys endogenously emerged to direct traffic around the roadblocks. This made for exciting driving.

[iii] This is, obviously, an outsider’s perspective. While we spoke with people from numerous walks of life, this is not fully researched. Other considerations not examined include how much was destroyed on each side of the island, money spent by the respective governments, the size and quality of the airports and seaports, and changes to building codes.

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