According to the World Bank in the Dominican Republic “Over the past decade, economic growth in the DR has substantially reduced poverty rates and supported the expansion of the middle class. However, disparities in access to economic opportunities and public services remain deep.” The Dominican Republic, like other countries, has suffered from the pandemic. Today, the Dominican Republic is slowly recovering and is having a positive rebound. The poverty level dropped by 21 percent. But with the pandemic’s impact, more people are unemployed. Like other countries, the Dominican Republic has restricted rules of social distancing, wearing masks and people needing to get the vaccine, and cleaning rules. However, the Dominican Republic has found ways to get back to normal because covid 19 has a negative impact on the economy and the government decided to remove the restriction of covid 19 to help the economic growth, making tourism and other sources of work back to normal (OCHA,2022). Moreover, the Ukraine and Russia conflict is affecting the Dominican Republic’s economy because oil and wheat prices have risen like never before. Gas prices are over ten dollars in the Dominican Republic, and this has affected other areas as well.
Retailing
The Dominican Republic is one of the most dynamic economies in the Caribbean region. The Dominican Republic is an upper-middle-income country with low and stable inflation. Is the second-largest economy in the Caribbean, just behind Cuba, and the third-largest country in terms of population (behind Cuba, and Haiti). (Autry, 2020). In 2019, Dominican Republic GDP will end up at $89 billion, a 5.1 percent increase from 2018. The Dominican Republic’s major export growth has moved away from its traditional products (raw sugar, green coffee, and cacao) to gold, Ferro nickel, sugar, derivatives, free-trade zone products, vegetables, and other agricultural products. The top then growth products in the Dominican Republic are cheese, wine, beer, pork, chicken parts, and meat (beef, seafood, snack foods, frozen potatoes, vegetables, and fresh fruits and the top DR retailers are La Sirena, Polo Supermarkets, Jumbo, Nacional Supermarkets and Bravo. Additionally, The Dominican Republic (DR) is one of the largest and most stable economies in Central America and the Caribbean. With U.S. consumer-oriented product exports reaching $600 million in 2019, the country represents the fifth-largest market for such products in the Western Hemisphere. (Autry, 2020) In addition, the main export partners of the Dominican Republic are the United States, Haiti, Switzerland, India, and Canada. (Wikipedia, 2022)
The Business Side of Fashion
In addition, the textile sector is becoming very important in the Dominican Republic, because 70% of the Dominican free zone companies are textiles companies and “being one of the milestones of the country in respect to levels of export and employment.” (Now, the Dominican Republic has better benefits because the United States is getting out of china. (2017) Also, Dominican Republic is one of the Central American regions where the textile sector is very important for the government, and the textiles sector brings many benefits to the economy and became one of the top 5 industries that contribute most of the economy of the region. (Litman, 2015)
According to “Dominican Republic Free Zone” the textiles and apparel industry in the Dominican Republic has been progressing through the years, moving from light manufacturing and intensive hand labor to now being capable of offering vertical integration with design and full package options. The Dominican Republic has 229 textiles and apparel manufacturers making around 50,000 direct jobs and exports make it to amount of $1.1 billion USD, being 13% of the country’s total exports. “Today, 41% of the exports in textiles are condensed in textiles input such as fabrics and yarns, exported mainly to Haiti and Central America.”
Factors of production
The Dominican Republic has a mixed economy based largely on services (including tourism and finance), trade, manufacturing, telecommunications, and construction; agriculture and remittances from the many Dominicans living abroad are also important. (Goldberg, 2022) One of the most important sources of foreign exchange in the Dominican Republic is tourism, becoming the Caribbean’s most popular tourist destination. People like to go to the Dominican Republic because they enjoy the beautiful beaches, climate, restored Spanish colonial architecture, and the low prices in the country. Popular tourists are from the United States, Canada, Italy, and other European nations. The most important tourist sites are La Romana, Samana, Puerto Plata, and Santo Domingo.
Trading Partners
The Dominican Republic has a good relationship with the United States, China, Mexico, Spain, and Brazil. The Dominican Republic’s most important trading partner is the United States with more than 40% of total commercial exchange, resulting in $ 12 billion in trade. The second main trade partner is China with over $3 billion in trade. Mexico, Haiti, and Spain have over $700 million in trade. Last, Brazil has the lowest amount which is $500 million. The free trade zone manufacturers’ products are medical devices, electrical equipment, (pharmaceutical and chemicals), gold, nickel, agricultural products, liquor, cocoa bean, silver, sauces, and seasoning. The direct investment flows in the Dominican Republic were strong in 2020 during the COVID-19 pandemic with 2.5 billion added to the stock in that year. Also, having grown to an estimated $44.5 billion and growing more than before since 2006 when the liberation efforts began.
The Dominican Republic is the Fifth Largest-Hispanic population in the United States where the culture has emerged in the United States in every state with arts, music, sports, and politics. The Dominican Republic and the United States do not share only the trade; they share a long history spanning governance, and familiar post-colonial roots. Also, the Dominican Republic became the United States’ four largest trading partner in Latin America and the Caribbean, and DR is the sixth-most popular destination in the world for U.S tourists. In the last three years, the Dominican Republic has had a strong relationship with Taiwan and signed dozens of new economic and cultural agreements with Beijing. (Runde 2021)
In 2020, Dominican Republic will export various main products to China resulting in $298 million which are ferroalloys, medical instruments, and special pharmaceuticals. During the last 25 years, the exportation to China from the Dominican Republic has risen with a rate of 47.3% from $18.5k in 1995 to 298m in 2020. (Runde, 2021) Moreover, the Dominican Republic has a good relationship with the United States. The Dominican Republic wants to cut its relationship with China because its main trading partner is the United States.
Written by: Carlton Georges
