Dominican Republic 2013 | ECONOMY | VIP INTERVIEW

TBY talks to Jean Alain Rodríguez, Executive Director of the Investment and Export Center of the Dominican Republic (CEI-RD), on the sectors of the economy with the most potential for investment and opportunities in the field of exports.

The Dominican Republic has received over $14 billion in investment in the last seven years. What current economic factors make the Dominican Republic attractive for foreign capital?

A sound business climate, political and economic stability, a strategic location, solid legal framework for foreign investment, modern transportation infrastructure, and advanced and reliable telecommunications have been some of the main reasons for the Dominican Republic's success in being recognized as the top recipient of FDI in the Caribbean. According to the United Nations Economic Commission for Latin America and the Caribbean (ECLAC), in 2011 the country accounted for 53.3% of total foreign investment registered in the Caribbean, and was one of the main recipients of foreign capital in Latin America. The remarkable performance of the Dominican economy and the competitive advantages offered by our country for doing business have provided an increased flow of FDI in the productive sectors nationwide. To put this variable into perspective, total FDI received in 2012 amounted to $3.5 billion, representing a record figure for our country. Furthermore, foreign investment has been one of the main driving forces of the Dominican economy in recent years due largely in part to the macroeconomic stability and the positive growth rates that have been sustained, transforming us into one of strongest economies in the Caribbean and one of the most important in the Latin American region. In 2010, the Dominican economy was ranked fifth in overall performance, and according to the ECLAC, one of the least volatile in the region with a 5.9% average GDP growth rate. In 2011, the Dominican Republic grew 4.5%, the same as the regional average, and above the average growth of the world economy (3.9%), according to the IMF.

CEI-RD's “Dominicana Exporta" program aims to increase the country's exports to $12 billion by 2013. How is this plan being implemented?

For the past eight years, there has been a steady increase in Dominican exports, although progress was briefly interrupted by the global economic crisis that shook the markets in 2008-2009. However, in 2011, the export of Dominican goods reached its highest historical value, amounting to $8.5 billion. Interestingly, the make-up of our product lines has also changed substantially over the years. While sugar represented close to 70% of our foreign earnings three decades ago, nowadays what we call traditional products (sugar, coffee, cocoa, and tobacco leaves) represent only 7%; minerals account for 5%, and 88% of our exports are non-traditional products, including fruits and vegetables, gourmet and organic products, agro-industrial goods, and manufactured items. The Dominican Republic is becoming known for its capacity to produce world-class goods and services. In 2011, we exported more than 3,150 different product lines to over 173 countries around the world. As a policy measure, and following the strategic guidelines of President Medina, CEI-RD aims to support development opportunities for small businesses to boost economic growth and increase exports. CEI-RD focuses on those productive sectors and aims at the internationalization of SMEs, which constitute over 90% of existing companies registered in our country and are also responsible for the creation of more than 1.06 million jobs.

“For the past eight years, there has been a steady increase in Dominican exports."

What other sectors are you targeting?

There are many sectors that have received significant investment from foreign sources in the last six years, such as the transportation sector, which reached FDI totals of $682.5 million, the financial sector, with a value of $642.8 million, and free zones, which received over $487 million. In 2006, there were only 12 companies that had a total of 4,543 agents and 3,800 seats. Currently, it has been estimated that there are between 30,000 and 33,000 agents employed in the industry and an approximately 27,400 seats. The projections are that the sector will grow by over 80% in the next five years, anticipating that more than 60,000 agents will be employed in the industry by 2016.

© The Business Year - March 2013