Bilateral trade US tariffs would reduce the competitiveness of Dominican Republic exports

Dominican exports to the United States could lose competitiveness, face price increases, and need to renegotiate terms with buyers following the new tariff scheme announced by President Donald Trump, which imposes tariffs of between 10% and 12.5% ​on imports from 60 countries, including the Dominican Republic.

The warning was issued by Roselyn Amaro Bergés, executive vice president of the Dominican Association of Exporters (Adoexpo), and Celso Juan Marranzini, president of the National Council of Private Companies (Conep), who emphasized that this provision is part of the new package of differentiated tariffs announced by the Donald Trump Administration.

Both businessmen explained that the new tariffs replace the temporary 10% global surcharge applied by the United States since February, which expired on Friday. For Dominican products affected by the measure, the rate will rise to 12.5%, representing an increase of 2.5 percentage points compared to the previous temporary tariff.

According to Adoexpo, although the difference may seem moderate, the increase can have a significant effect on operations with reduced margins, long-term contracts, and products that compete directly with exports from countries such as Guatemala, Honduras, and El Salvador, which were subject to a 10% tariff.

Amaro indicated that the annexes and tariff subheadings must be reviewed to determine the scope of the measure on Dominican exports accurately. He specified that the scheme includes exclusions for certain textiles, food products, fertilizers, and other goods identified by US authorities.

Preliminarily, he indicated that the most vulnerable sectors would be the agro-industrial and agricultural products that were not excluded, plastic manufactures, iron and steel products, metal structures and parts, as well as other national manufactures that currently enter the US market under the preferences of the Dominican Republic-Central America-United States Free Trade Agreement (DR-CAFTA).

However, Adoexpo emphasized that the impact will not be uniform, as it will depend on the specific product, the tariff already paid, its share of the US market, and each company’s ability to absorb or pass on the new cost.

Regarding a possible diversion of purchase orders, the organization acknowledged that this risk exists, especially in those products that can be substituted by goods from countries with a lower tariff rate or excluded from the measure.

He added that, in sectors highly sensitive to price, the 2.5 percentage point difference could influence the purchasing decisions of US importers, who might even request discounts, share the cost of the tariff with the exporter, or reconsider future orders.

However, he argued that the Dominican Republic maintains competitive advantages such as its geographical proximity to the United States, shorter delivery times, the reliability of its companies, the stability of its supply chains, and the trade relationship developed under DR-CAFTA.

On the other hand, Marranzini warned that if the measure persists in the medium and long term, while other countries like Mexico have better access to the US market, it could negatively affect Dominican exports and hinder the nearshoring process. Therefore, he considered it essential to maintain dialogue with US authorities to ensure that the Dominican Republic is placed at the lowest tariff level and to provide immediate support to companies that may be affected.