The most developed island among the Dutch Caribbean territories, Aruba lies 25 km (16 miles) off the coast of Venezuela. It has a tropical climate moderated by constant trade winds sweeping in from the Atlantic. Formerly the richest island in the Netherlands Antilles, Aruba became a separate dependency of the Netherlands in 1986. Transition to full independence was halted in 1994 after an agreement was reached between the governments of the Netherlands, Aruba, and the Netherlands Antilles. The Netherlands voiced concern over the island's security and the danger of its becoming a base for narcotics trafficking, and the Aruban government questioned the desirability of full independence, citing high unemployment and economic instability.

The economy of Aruba, formerly dependent on oil refining, has diversified since 1986. Tourism and offshore finance have become the most important sectors of the economy, and there are now more than 700,000 visitors annually; nearly 60% of them come from the USA. However, the rapid expansion of tourism has put considerable strain on Aruba's infrastructure, and some attempt has been made to restrict the number of visitors. At the same time facilities have been improved to encourage the growth of a data-processing industry.

Aruba's cooperation with the USA in the region includes support for its actions against narcotics trafficking from South America, and since the closure of the US base in Panama in 1999, US aircraft have used bases on the island to launch reconnaissance flights. Those who oppose this cooperation fear that it could drag Aruba unnecessarily into the civil conflict in Colombia.