Dominican Republic: Pace of economic growth decelerates but remains strong in Q3
October 21, 2016
The economy grew 5.8% in the third quarter of the year in annual terms, according to preliminary data from the Central Bank. Q3’s expansion represented a deceleration from the stronger 8.7% growth registered in the previous quarter and the lowest pace of growth since Q2 2013.
In its flash release, the Central Bank of the Dominican Republic provided Q3 data for GDP growth, while for the breakdown of GDP by sectors it only provided year-to-date data for the first three quarters in a year-on-year comparison. According to the Central Bank, in the first nine months of this year, the economy expanded 6.9%, slightly decelerating from the 7.4% growth registered in the first nine months of 2015. The reduced pace of growth came on the back of weaker expansions in the services, local manufacturing and construction sectors. It was also due to the fact that production in the free economic zones swung from expansion to a mild contraction.
In contrast, mining and quarrying swung from an almost double-digit contraction in the first nine months of 2015 to a sharp expansion in the corresponding period of 2016, and the agricultural sector accelerated notably. The mining and quarrying sector saw an impressive 22.3% year-on-year expansion in the first three quarters of 2016 (corresponding period of 2015: -9.1% year-on-year). The local manufacturing growth rate decelerated from 2015’s 6.1% to 5.3%, while in the same period manufacturing activity in the country’s special economic zones swung from 4.5% growth to a mild 0.4% drop. The agricultural sector recorded a robust 10.6% increase (2015: +2.3% yoy). The construction sector expanded 12.2%, which nonetheless represented a substantial slowdown compared to the 21.1% growth recorded in the first nine months of last year. Finally, growth in the services sector decreased slightly, from 6.5% in the first nine months of 2015 to 6.1% this year.