It all depends on the color… Subtracting from the positive signs of the Dominican Republic’s economy

The indicators that would allow the country to be described as situated “in the solidity of its internal foundations” to preserve itself economically from a “turbulent international environment” are accompanied by the emphatic demand from the International Monetary Fund (IMF) to the Government to undertake fiscal and structural reforms in the short term and an additional study released this week that expresses some alarm at the stagnation of income with a chronic budgetary deficit, reflecting that current expenses are not being covered.

The only thing missing for the backdrop to the catastrophic narratives emerging from the opposition, the most unwilling to see any positive aspects in President Luis Abinader’s administration and which does not refrain from using disproportionate artillery to assume that the Republic is in “economic decay and political wear and tear” or suffering “the abandonment of basic services that deteriorate -in extremis- basic services.”

Last October, outlining clear premises, the columnist for the newspaper Diario Libre, lawyer and academic José Luis Taveras (without known affiliation or anything like that) called on the anti-government trench to “re-evaluate its role and overcome the model of indiscriminately criticizing and disqualifying the Government without offering different alternatives for the solution of the main problems of society.”

He added: “The opposition is demonstrating its chronic conceptual poverty by sticking to a script of criticism without realizing that it’s actually gaining points for the government.” He urged them to move beyond “criticism for criticism’s sake and approach it with a modicum of rationality in order to give it consistency and credibility.”

CONCERNS

Without omitting details favorable to its reasoning about the direction of the Dominican economy, nor adding any irritation to its assessments, the International Monetary Fund seemed to agree more than before with local analysts who express concerns about current account deficits, urging this time that it be reduced, which could be interpreted as setting a peremptory deadline.

And although he is confident of a near economic rebound, he does not fail to point out that growth has slowed since the end of 2024 and the first half of 2025 due to increased uncertainty and restrictive financial conditions that persist as a brake on development, which could jeopardize stability.

In its recent report to the Government, the IMF, with emphatic phrases that nonetheless conveyed optimism, reiterated that the Dominican authorities must maintain prudent fiscal policies while calling for an increase in public investment, which has fallen to its lowest level in more than two decades.

“Fiscal and structural reforms, especially in the electricity sector, are essential to improve medium-term growth prospects,” he added, taking into account that subsidies in that sector are growing and growing, while charges for energy supplied, including stolen energy, are falling and falling, with the Government’s easy reaction being to increase debt to the point of being undesirable.

Regarding this, after studying the key points of the 2026 General State Budget proposal, economist Rosa Cañete Alonso, with a distinguished career at the UNDP and a master’s degree in development, reiterated this week her concern that “the Dominican Republic continues to allocate more resources to cover past debts than to invest in its future and development.” She maintained that this is a country “trapped in the dangerous vicious cycle of stagnant revenues and rigid, ever-increasing spending.”

ANOTHER VERSION

Setting itself apart, a very recent publication from the Central Bank emphasized that “the Dominican Republic has experienced sustained economic growth in attracting Foreign Direct Investment despite a challenging international environment, and even though the flow of direct investment worldwide fell by 11% while in the Dominican Republic it grew by 3%” in 2024. And with a tone of absolute optimism, the entity highlighted that the country “is comfortably covering the current account deficit in the balance of payments.”

Based on the above figures, the Central Bank categorically stated that it was proven that with its current structural foundations, the Dominican economy not only mitigated the negative global impact but also strengthened its relative position in the region, experiencing growth in investment inflows in 2024 when they increased by 49.7% compared to what happened in 2019 before the pandemic.

Certifying a positive performance, the Central Bank considered evident “the strength of the country’s macroeconomic fundamentals and its capacity to sustain the flow of external capital even in contexts of international volatility.”