What Amazon’s New Carib Hub Means for Local Biz?

M.A. Dworkin

Santo Domingo - Amazon Air has begun operating dedicated cargo flights from Miami, Florida to the Dominican Republic (DR), establishing a Caribbean hub, bringing the probability of faster deliveries to the U.S. Virgin Islands. 

With the demise of Kmart, closing down its operations on STX and STT, a retail gap has opened up for any number of everyday products and household goods that have become increasingly hard to find on island at reasonable prices. 

“Shop Local” may very well be an admirable way to support local businesses, but most USVI consumers realize it can also be harmful to their pocketbooks. For years, Amazon has brought in products that either are not available on local shelves or were considerably more reasonably priced. Their shipping rates have also been quite reasonable. 

Now, with the Kmarts gone, Amazon along with China’s Temu (Shop Like a Billionaire) have filled the much needed retail gap even more so over the past several months. Up until a recent change in Amazon’s shipping policy to the islands, deliveries that had normally arrived in a matter of days, now have taken weeks to be delivered. Temu’s initial policy has been free shipping into the USVI, although that shipping is rather slow.

Amazon, the ever ingenious Numero Uno Retail Marketer of the internet age, has moved to rectify those shipping delays by opening a distribution-transfer hub in the Dominican Republic. 

The move is not expected to sit well with local retailers. Without the influx of refinery workers, St. Croix, in particular, has become a slowly deteriorating retail landscape. The increase in cruise ship passengers does not necessarily translate into substantial cash register sales for the many retail shops, particularly those in Christiansted.

“It’s another nail in the coffin,” a longtime shop owner told the St. Croix Times. “When do they get it? We need a life raft.”

“What kind of life raft would that be?” The St. Croix Times inquired.

“More people who spend more money,” was the reply.

Without the Refinery reopening and providing that type of instant population jolt, that is a hat trick not easily performed.  

Amazon Air’s inaugural service, a Boeing 767 freightliner, landed at Las Americas International Airport in Santo Domingo this last week. Operated in partnership with ALK Global Logistics and airport operator AERODOM, the new route links Miami and Santo Domingo with seven weekly flights, adding around 770 metric tonnes of weekly capacity. 

The service will operate independently of Amazon’s own e-commerce operations, offering scheduled and reliable third-party cargo solutions for freight forwarders and logistics firms.

The DR is therefore set to host a historic milestone in its economic and logistical development with the arrival of Amazon as a Caribbean distribution hub. Amazon’s entry is expected to generate significant economic opportunities, boosting job creation, logistics, transportation, and technology. 

Faster and more efficient deliveries could also transform consumer habits, with products arriving more quickly, in some cases within a few days. However, the expansion of Amazon into the fast-delivery retail arena also raises serious concerns on the future of the already depressed local businesses in the USVI, which are already struggling to compete with Amazon’s selection and price points.  

Industry observers say Amazon Air’s arrival cements Santo Domingo’s status as a strategic logistics hub for the wider Caribbean, strengthening regional supply chains and boosting opportunities for exporters. 

Under the circumstances, the question has to be asked, Why was the USVI passed over for such a prestigious honor? Why isn’t  Amazon Air landing on St. Croix or St. Thomas? It sounds like a similar question folks have been asking for years, Why isn’t Walmart in the USVI?

Population density is certainly one reasonable answer. It rules the roost when big corporations go to decide what facilities they put, and where they put them. But Governor Bryan’s recent call to update outdated laws that he says are hindering private investment, job creation and the Territory’s ability to compete globally, may also be another answer. Amazon Air is not the first big company to pass over the USVI for sweeter deals elsewhere. They probably won’t be the last.