DR economy more susceptible to covid effects

Rafael Muñoz de Bustillo Llorente, professor of Applied Economics at the University of Salamanca, affirmed yesterday that the Dominican Republic has an economy very susceptible to be affected by the restrictive measures against the covid-19 pandemic because 37% of the income from exports comes from tourism.

In the virtual teleconference “Welfare State in times of covid-19”, organized by the Ministry of Economy, Planning, and Development, the expert, said that the face-to-face productive activities, fundamentally the hotels, restaurants, and the cultural sector, have been very intensely affected by the pandemic.

He maintained that the sectors with more viability for teleworking are less affected by the coronavirus.

He said that the different countries’ economic structure makes it easier to pass to telework than in others.

He emphasized that the Dominican Republic has had a drastic fall in tourism, which is an essential source of balance of payments equilibrium.

He considered that the abandonment of the fight against covid-19 would generate such a sanitary situation that would ultimately affect the economy.
He stated that a country like the Dominican Republic could not be expected to have a social protection expenditure in the gross domestic product (GDP) such as Spain or France.

He added that this is achieved progressively as the country develops, and a part of this growth is used to create a welfare state to develop a universal health system.

He said that countries had had different impacts in terms of the fall in GDP depending on the productive structure and the measures adopted to reduce the pandemic’s effects.

The Spanish professor said that covid-19 has resulted in a drop in supply and the breakdown of global value chains, which has triggered a slump in tourism and an increase in unemployment.