Caribbean Export OUTLOOK 2016

Meanwhile, the country saw a record number of tourist

arrivals (5.1 million) in 2014 – a 9.6% increase year-on-year.

presence in the Americas. Recently, relations

have been boosted with several neighbouring

countries including Puerto Rico, the Bahamas,

and Trinidad and Tobago. The government

signed a raft of agreements with Puerto Rico

in January 2015. The most important of these

include deals that: allow theDominicanRepublic

to provide parts for Puerto Rican finished goods

that are then sold to the US government, via the

Buy America Act; allow Dominicans studying

in Puerto Rico to pay the same fees as local

students; and encourage better management of

natural resources. These and similar agreements

aim to strengthen the country’s economic and

trading profile and to maximise its role in the

Dominican Republic-Central American Free

Trade Agreement (DR-CAFTA).

As a result of this strong performance and the

credit given to President Danilo Medina, the

National Assembly passed a constitutional

amendment in June 2015 allowing presidents

to stand for a second consecutive term. However,

even with the many positive aspects of the

economy and the political support that has

accompanied that, there are several issues which

the authorities must address in order to ensure

that the progress made so far does not falter.

In a recent World Bank report, ‘Fostering

Dynamic Growth of Exports in the Dominican

Republic’, it was noted that the country remains

highly dependent on the US and Haiti for its

exports – about 70% of its exports go to these

two countries. Further, the report stated that

growth in exports since 2000 has been below

that of Colombia, Honduras, Costa Rica,

and El Salvador. The World Bank therefore

recommended that the Dominican Republic

improve the quality of its farm produce, bolster

its duty-free manufacturing export sector, and

open new markets.

Other concerns include rising debt, which the

International Monetary Fund (IMF) estimates

will be 50% of GDP by 2016. In a related issue,

the tax system is hampered by low revenue

collection and a heavy reliance on indirect

taxes, which means it is both regressive and

unable to provide the necessary resources to

improve basic public services. As inequality in

the country is high and has actually increased

since 2000 (32% then, compared to 41%

in 2011), reforms to the tax system and the

delivery of public services would bring tangible

improvements for many. The country also still

suffers from frequent power outages, caused

by inadequate investment, and the widespread

theft of electricity.

The Dominican Republic has made significant

progress in recent years to strengthen not just its

domestic economy but also its regional trading

position, and this is expected to continue.

However, more needs to be done to incorporate

all Dominicans into this success story.

Dr. Peter Clegg is a Senior Lecturer in Politics at the University of the West of England, Bristol. He has been a Visiting Fellow at the Institute of Commonwealth Studies

in London, and a Visiting Research Fellow at the Sir Arthur Lewis Institute of Social and Economic Studies (SALISES) at the University of the West Indies in Jamaica.

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