Industry News

Aruba’s Smart Island Strategy

How is Aruba transforming its economy from one that for most of the last 100 years has been heavily dependent on oil-refining and, more recently, tourism, to one that is more diversified and more sustainable?

The economy of Aruba is 70% dependent on the tourism industry. Diversifying the economy and reducing Aruba’s reliance on a single sector is integral to the government’s long term strategic goals. Aruba is developing a new pillar of the economy – a knowledge economy – to bring greater diversification, economic stability, growth and sustainability. This important new pillar is based on Aruba’s initiative to develop the island as a “Green Gateway” between Latin America and the European Union in the areas of green technology, business support services and creative industries.

Aruba is making use of its proximity to Latin America and its knowledge of not only the language (Arubans speak Spanish, in addition to Dutch, English and Papiamento) but of business practices and customs in the region. As a member of the Kingdom of the Netherlands, Aruba also is relying on its privileged legal and constitutional status as a member of this major trading country within the European Union. And we are refocusing on our historically close ties to the United States as well. Exceptional US companies, such as Hyatt and Marriott, have invested in Aruba, and we want to attract equally stellar US companies in other sectors to invest in Aruba and to use Aruba as regional hub for green energy services and products.

In addition, Aruba has established a collaborative public-private-academic entity as a centre of excellence for tourism in Aruba with the support of internationally renowned tourism education institutes in Europe and the Americas, as well as local Aruban institutions. Finally, Aruba will be developing highly skilled jobs as it transitions to renewable energy

How successful has the Green Gateway economic vision and policy for a knowledge-driven, entrepreneurial economy been, so far?

Aruba is off to a very strong start. In a few short years, we have become recognized as a leader in the region for our efforts to promote sustainable prosperity and a knowledge-based economy. Two Dutch organizations have already established branch offices in Aruba and are contributing to our knowledge-based economy. TNO is a leading scientific research organization, and is not only working in Aruba, but is also using our island as a regional hub to expand its research and services in the area of
renewable energy. The Gerrit Rietveld Academie, one of the top Dutch universities of applied sciences for fine arts and design, has also established a presence in Aruba. Schiphol International B.V. is managing the Aruba Airport Authority N.V. KLM is using Aruba as a hub for the region, and it has already made its first flight using biofuel to Aruba. Royal Philips is partnering with the government of Aruba to revamp the entire public lighting system in Aruba and retrofit all public building lights to LED. Several other international companies are actively considering Aruba as a site for regional expansion.

What is the Smart Island Strategy, and how does Aruba plan to transform from the current energy mix to one that is 100% reliant on renewable energy by 2020?

Aruba views prosperity as not only material success but also as the quality of our lives and the health and happiness of our families. We have five-star hotels in Aruba, but we also want five-star schools, hospitals, elderly people’s homes, neighbourhoods and a five-star quality of life. To create the type of prosperity that also is sustainable means focusing on ‘doing more with less’, so that creating prosperity today need not sacrifice the quality of life of future generations.

A key component of our strategy – what we call a ‘Smart Island Strategy’ – for achieving this is to transition our island to 100% renewable energy. Aruba’s early success in renewable energy projects has attracted the interest of some powerful strategic partners, such as TNO and the Carbon War Room, the global initiative founded by Sir Richard Branson and other entrepreneurs. In cooperation with these groups, we are developing an integrated strategy to become one of the leading countries in the world in the use of renewable energy. This will not be easy. Wind and solar energy can only take us so far because of intermittency issues, but we will be looking closely at newer technologies for both energy production and storage, as these become more reliable and cost effective.

In Aruba, we are looking forward to achieving our first ‘green hour’ of electricity completely generated by renewable energy, and then our first ’green week’, ‘green month’ and so on, until we have achieved our ultimate goal.

What can other small islands learn from Aruba’s experience?

We in Aruba are trying to do what is right and what makes sense for Aruba. If some of those lessons can be of benefit to other countries as they embark on a similar journey, then we would of course be very proud. But each country is different and must find its own way. Sir Richard Branson and the Carbon War Room accepted the challenge of the United Nations to take the lessons they learn from working in Aruba and to apply these in ten other island nations. That is an exciting challenge, and we would be honoured to play a role in that endeavour.

I would not presume to advise other governments because each country is unique. One approach that has served Aruba well, however, is the process of social dialogue – involving the community and stakeholders in any major initiative and sitting together to reach a consensus on the way forward. A challenge for many small island states is convincing the electric utility that it can happily co-exist with efforts to introduce renewable energy. I get many questions from leaders of other island nations about the cooperative and proactive attitude of our electric utility company, W.E.B., and how that came about. We would welcome the opportunity to share the lessons we have learned in Aruba, if other countries feel this could be helpful.

Source: Interview with Prime Minister Michiel Eman, Making It Magazine

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