Dominican Republic Economic Activity January 2021

Dominican Republic

Dominican Republic: Economic activity records sharper decline in January

March 16, 2021

Economic activity decreased 1.8% year-on-year in January (December: -1.0% yoy), with the sharper decline likely due to the tougher restrictions in place during the month to stem rising Covid-19 cases.

Meanwhile, the trend pointed down, with the annual average variation of economic activity coming in at minus 7.2%, down from December's minus 6.7% reading.

The economy should bounce back strongly this year. The external sector should benefit from greater fiscal stimulus in the U.S. under Biden, which will support exports and remittances. Moreover, tourism should gradually recover, while fiscal and monetary support at home will aid domestic demand. However, lingering Covid-19 restrictions, including curfews and capacity restrictions for public venues, will keep a lid on momentum, at least in the early part of the year.

FocusEconomics panelists see the economy growing 5.1% in 2021, which is down 0.3 percentage points from last month’s forecast, and expanding 4.7% in 2022.


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Dominican Republic Economic Activity Chart

Dominican Republic Economic Activity January 2021

Note: Year-on-year changes of GDP in %.
Source: Dominican Republic Central Bank and FocusEconomics Consensus Forecast.

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