The Dominican Republic is a democratic state with a government and elected officials under the parameters of a modern constitution and adapted to the more developed libertarian processes and respect for the rights of citizens, enabling them to participate freely in the development of the main activities that affect their quality of life. Likewise, the freedom of enterprises, the free access to goods and services, and a legal framework clearly established and respected by its authorities and civilians, are characteristic of this nation, which has registered a favourable growth of its economy, with an average of around 5% a year in the last 50 years. The powers of the state are confined to the Executive, Legislative and Judicial, the first two being elected every four years under a representative democratic framework.
The commercial relationship between the United Kingdom and the Dominican Republic represents an important asset for both countries. As part of CARIFORUM, the Dominican Republic is a signatory part of the Economic Partnership Agreement (EPA) between the 15 countries of the Caribbean and the member states of the European Union. This agreement entails major trade benefits, allowing the free exchange of goods and services between the two regions.
Social, economic and political stability
In spite of the external and internal shocks that the Dominican economy has faced in recent decades, the country has maintained a sustained pace of growth, reaching 6.6% in 2016, which places the Dominican Republic for the third consecutive year as the leader in Latin America. At the end of 2016, the Dominican Republic’s Gross Domestic Product reached $71,654 million, which in per capita terms equates to $7,112 according to official figures from the Central Bank (BCRD).
The Dominican Republic has low levels of inflation relative to other countries in the region. In 2016 inflation ran at 1.7%, according to preliminary figures from the BCRD – the second lowest in the country over the last 33 years. By contrast, the average for the region of Latin America and the Caribbean was 5.82%, according to the International Monetary Fund (IMF).
Competitive costs for doing business
According to the report ‘Caribbean and Central American Countries of the Future 2015/2017’ published by fDi Intelligence , the Dominican Republic ranks second for ‘Best Connectivity in Central America and the Caribbean’.
Notable in this regard is the port of Caucedo, which is ranked fourth best in Latin America in terms of quality and second for principal distribution in the region. Uniquely for Latin American Atlantic ports, Caucedo facilitates direct access to and from Asia. It also has the capacity to receive Post-Panamax (oversized) ships.
These attributes make the Dominican Republic one of the top six countries in Latin America in terms of affordability for the export and import of containers.
A strategic geographic location
The Dominican Republic lies at the heart of the Caribbean, at the crossroads between the North, Central, and South American markets. It is ideally positioned to service all of its surrounding markets, including the USA. With ten international airports and five major ports, it has become the hub for trade with the rest of the Americas and Europe. Both the port of Caucedo and the Punta Cana airport are the major trans-shipment points for the region’s exporters.
Incentive programs for Foreign Direct Investment (FDI).
Legislation in the Dominican Republic offers incentives and exemptions in various areas of production and services for the materialisation and implementation of foreign investment in the country. These regulations are covered by the current Constitution, which recognises respect for agreements signed by the country and the international organisations of which it is a member.
Solid legal framework
The Dominican Republic’s Foreign Investment Law provides for National Treatment and eliminates restrictions to investment in public enterprises, mining, banking, and insurance. Generous tax breaks are also available in Export-Processing Zones (EPZs), Renewable Energy, Tourism Development, the Film Industry and the provinces bordering with Haiti.
One of the fastest-growing economies in the region
The Dominican Republic has achieved average yearly growth rates of 7% since 1991 thanks to macroeconomic stability, continued public investment in infrastructure and sustained private investment in housing, industry, and services. With treaty-level links with the US, the EU, Central America and CARICOM Countries, the DR enables producers based in the DR to cater to all surrounding markets.
A young, qualified and experienced labour force
The Dominican Republic business community benefits from professionals with high levels of training in numerous disciplines, including graduates from prestigious domestic and international universities and a high numbers of bilingual young people.
The Dominican Republic has more than 49 universities and institutes offering specialised training in various areas. The Dominican government prioritises constant educational improvements to promote ever higher levels of knowledge and ensure a constant flow of fully qualified professionals into the business sector. The focus is on improving the conditions of teachers and developing effective programmes in all areas of education.
As evidence of the success of this strategy, in 2016, the Dominican Republic was positioned as the 2nd country with the best level of English as a second language in Latin America according to the Education First English Proficiency Index.
One-Stop Shop for investments
The country offers a personalised and efficient single-point-of-contact service to all investors to deal with any necessary requirements.
Top performing industries and key drivers
Due to Barrick Gold’s production in Pueblo Viejo.
Due to private sector credit dynamics.
Due to expansionary monetary policy which favoured housing credit.
Due to the higher per capita expenditure of foreign visitors
The DR issued $1.25 billion of the securities due in 2044 at a yield of 7.45 % and sold a record amount of bonds in the nation’s first offering of 30-year dollar debt since 1994.
Capacity has increased with investment in renewables as well as two coal-fired plants of 300-megawatt each, built and financed by Brazilian construction company Odebrecht. DR President Danilo Medina inaugurated the biggest energy complex built in the country’s history back in October 2013 – a $700 million energy complex in San Pedro de Macoris.
Gold production has positioned the DR at the centre of the oldest mining industry in the Americas. The $4 billion Invested by Barrick Gold and Goldcorp into developing the Pueblo Viejo gold mine since 2009 amounts to the largest single foreign investment in DR history. The world-class operation facility should provide the DR with US$10 billion in revenues over 25-years.
Large natural gas reserves have been found in the Enriquillo basin. Maleno Oil Co.’s ongoing exploration plans in the Boca Cachon cover 597,000 acres. The company is deploying an exploration programme involving geologic, mapping, gravimetric, seismic, and geochemical surveys, and the drilling of a well.
The DR has Latin America’s highest density of road penetration and the third-best transport infrastructure due to high efficiency of its fourteen ports, eight international airports, and roads, reducing the time required for logistics operations. In 2016, Punta Cana Airport was awarded 2nd Best Airport by Region (over 2 million passengers per year), and Best Airport by Size and Region in the category of 5-15 million passengers per year. Moreover, Santo Domingo boasts two metro lines and is currently building additional ones.
The DR enjoys one of the most competitive telecom markets in Latin America, with overall service penetration near 100%. Since November 2013, Altice Caribbean, a subsidiary of the French Altice Group, has acquired Tricom for $400 million and Orange Dominicana for EUR1.1 billion, leading to the merger of their copper, fibre optic, cable and wireless operations within a seven-month period. Claro, a subsidiary of Mexico’s América Móvil, is still the dominant carrier.
The DR has become an international big budget film location, through Indomina, a $35 million joint venture investment between Pinewood Studios LLC and the Vicini Group (now Inicia). An enabling legal framework ensures attractive incentives to local and international investment. Low production costs and qualified human resources complement the attractiveness of the DR for high-budget year-round shooting, relying on facilities such as an 8-acre water tank.