Dominican Republic Economic Forecast

Domin. Rep. Economic Outlook

December 4, 2018

The economy performed well in the third quarter, with data revealing broad-based growth which was particularly strong in the duty-free manufacturing and construction sectors. Moreover, job creation strengthened, while exports were up notably in annual terms in the January–September period. Looking ahead to the fourth quarter, growth has likely remained robust. The number of tourists and remittances continued to boom in annual terms in October, likely supported by a tighter U.S. labor market. Moreover, the recent fall in oil prices will likely lead to a lower import bill, benefiting the external sector. On the political front, in mid-November, the Dominican Republic and Russia agreed to abolish visa requirements for citizens to travel between the two nations, which could boost Russian tourist arrivals going forward.

Dominican Republic Economic Growth

Looking ahead, growth will likely soften slightly due to a less favorable base effect. However, a budding labor market, strong fixed investment and spillovers from the robust U.S. economy—which should fuel remittances, exports and tourism activity—should ensure growth remains elevated compared to regional peers. Downside risks include monetary tightening in the U.S., high debt servicing costs, and vulnerability to severe weather conditions. FocusEconomics panelists expect GDP growth of 5.0% in 2019, which is up 0.1 percentage points from last month’s forecast. For 2020, panelists see the economy expanding 4.6%.

Dominican Republic Economy Data

20132014201520162017
Population (million)9.89.910.010.110.2
GDP per capita (USD)6,4106,6936,9037,1887,475
GDP (USD bn)62.766.268.972.476.0
Economic Growth (GDP, annual variation in %)4.97.67.06.64.6
Consumption (annual variation in %)2.63.85.34.84.7
Investment (annual variation in %)-2.512.320.611.40.5
Industrial Production (annual variation in %)9.814.88.5-  -  
Unemployment Rate15.014.514.013.3-  
Fiscal Balance (% of GDP)-3.3-2.70.0-2.8-3.0
Public Debt (% of GDP)37.036.035.136.938.9
Money (annual variation in %)10.710.511.610.010.3
Inflation Rate (CPI, annual variation in %, eop)3.91.62.31.74.2
Inflation Rate (CPI, annual variation in %)4.83.00.81.63.3
Policy Interest Rate (%)6.256.255.005.505.25
Exchange Rate (vs USD)42.6944.2845.5346.3447.80
Exchange Rate (vs USD, aop)41.7143.4844.9845.9347.31
Current Account (% of GDP)-4.1-3.3-1.9-1.1-0.2
Current Account Balance (USD bn)-2.6-2.2-1.3-0.8-0.2
Trade Balance (USD billion)-7.4-7.4-7.5-7.6-7.6
Exports (USD billion)9.49.99.49.810.1
Imports (USD billion)16.817.316.917.417.7
Exports (annual variation in %)5.55.0-4.64.22.9
Imports (annual variation in %)-4.82.8-2.12.91.7
International Reserves (USD)4.74.95.36.06.8
External Debt (% of GDP)38.239.738.738.7-  

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Dominican Republic Facts

ValueChangeDate
Exchange Rate50.270.80 %Dec 12

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