Dominican Republic Economic Forecast

Domin. Rep. Economic Outlook

April 9, 2019

The economy has begun the year in impressive fashion. Economic activity growth was robust in January and February, supported by a dynamic construction sector and ample credit provision. Moreover, tourist arrivals grew strongly in the same period, driven in part by strong labor market conditions in the U.S. In addition, remittances were healthy in January and February, which, coupled with muted price pressures, should have stoked private consumption. In a recent staff visit, the IMF praised the strong growth momentum and recent monetary and financial market reforms. However, the Fund encouraged the government to strengthen the fiscal position and the electricity sector, which remains a drag on the economy in the absence of the signing of the electricity pact. In March, the government announced a plan to cut red tape, which should boost economic competitiveness.

Dominican Republic Economic Growth

Growth will ebb this year due to a tough base effect and easing momentum in the U.S. However, the expansion should still be notably above the regional average, underpinned by strong credit supply and a healthy labor market. Downside risks stem from a fragile fiscal position, volatile oil prices and a possible faster-than-expected economic slowdown in the U.S. FocusEconomics panelists expect GDP growth of 5.2% in 2019, which is down 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 Rate-  -  -  -  -  
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 Rate50.500.80 %Apr 22

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