Dominican Republic economy will have grown more than 12% by the end of 2021

Projection. Growth will be one of the highest in Latin America.

The governor of the Central Bank of the Dominican Republic (BCRD), Héctor Valdez Albizu, reported that the Dominican economy registered a growth between January-November 2021 of 12.5%, which ensures the conditions to close the year with an expansion that could exceed 12%, one of the highest growth rates in Latin America.

During a press conference, Valdez Albizu pointed out that the monthly indicator of economic activity (IMAE) in November 2021 had a year-on-year variation of 13.1%, higher than expected.
He added that when comparing the accumulated result to November with the same period of 2019, economic activity was 4.3% above pre-pandemic levels.

He indicated that the sectors that registered the highest growth compared to 2020 were hotels, bars and restaurants (38.3%); construction (25.1%); free zones (21.2%); transportation and storage (13.0%); trade (11.8%); local manufacturing (11.0%); other service activities (5.8%); and energy and water (5.3%).

He highlighted the acceleration in public investment in recent months, as announced by the President of the Republic, Luis Abinader, and the boost in private investment in tourism, construction, and free trade zones.

Likewise, he highlighted the behavior of the tourism sector, projecting that the arrival of non-resident visitors would be around five million by the end of 2021, a recovery in which the Tourism Cabinet has played a leading role.

“This good performance has been supported by the advancement of the National Vaccination Plan, led by the Vice President of the Republic, Raquel Peña, which has managed to inoculate approximately 77% of the adult population with one dose and exceeding 64% with two doses, one of the highest vaccination-rates in the region, increasing the confidence of tourists to visit our country,” said Valdez Albizu.

Likewise, it indicated that the accumulated inflation as of November 2021 is at 7.71% and the interannual core inflation at 6.63%. In contrast, remittances and total exports continue with a vital dynamism, with interannual growth of 11.2% and 21.7%, respectively.

On the other hand, imports increased 69.7% in total, while non-oil ones increased 57.9%, in line with the accelerated recovery of domestic demand.

He added that the current account deficit for 2021 is expected to be around 1.9% of GDP, supported by the continuous flow of remittances that would exceed US $ 10 billion this year.
“It is important to note that this deficit will be covered 1.7 times by foreign direct investment (FDI) flows, which would be around US $ 3 billion at the end of 2021,” he explained.

He indicated that this significant inflow of foreign currency had favored exchange stability in such a way that as of November 30, 2021, the Dominican peso exhibits an appreciation of 2.5%, contrary to the depreciation observed in the currencies of most Latin American countries.

He highlighted that the increase in the receipt of foreign currency had allowed the accumulation of international reserves, which reached US $ 12,200 million as of November 30, 2021, equivalent to 6.2 months of imports and 13.1% of GDP, expected to conclude the year in an amount close to US $ 12.8 billion.