Economy February 26, 2023 | 12:30 pm

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Ministry of Economy reports reduction of monetary poverty in the Dominican Republic

The economic outlook for the DR in 2023 will depend on the international context.

According to estimates by the Interinstitutional Technical Committee on Poverty, the general monetary poverty rate was reduced by 2.1 percentage points in 2022. Despite the inflationary scenario, the economic and employment recovery reduced the number of people and households in general monetary poverty.

The Minister of Economy, Planning and Development, Pavel Isa Contreras, announced that, despite the inflationary scenario, at the close of 2022, monetary poverty in the country was reduced by 2.1 percentage points concerning 2021.

“Estimates made by the Inter-Institutional Technical Committee on Poverty Measurement indicate that overall monetary poverty in the Dominican Republic went from 23.9% in 2021 to 21.8% in 2022, for a reduction of 2.1 percentage points,” he said.

He added that in plain terms, despite the aftermath of the pandemic and international inflation, 200,000 Dominicans increased their income and acquired a basket of essential goods and services that allowed them to live decently, something they did not achieve in 2021.

This behavior resulted from the Dominican economy’s good performance during the year and increased employment. Particularly noteworthy was the fourth quarter, where he said a general monetary poverty level of 19.6% was recorded, the lowest ever observed in the country, representing a milestone.

“That reduction in monetary poverty levels was the result of the strong increase that was verified in employment and in people’s labor income due to the economic growth observed and the impact of the increase in government monetary transfers to poor or vulnerable households through Supérate.”

According to estimates by the Interinstitutional Technical Committee on Poverty, the reduction in overall monetary poverty would have been 3.6 percentage points higher had it not been for the higher-than-normal inflation experienced in 2022 due to increases in international prices of hydrocarbons, food, and raw materials. In other words, had it not been for this external factor, 340 thousand of people would have overcome monetary poverty.

According to Isa Contreras, these figures are consistent with the behavior of the Dominican Republic’s labor market, which shows a drop in unemployment and an increasing trend in formal jobs during 2022, indicating the country’s good economic performance after the pandemic. According to MEPyD estimates, this performance will continue to be favorable by 2023. However, the informality rate remains high, representing a challenge to improve the working conditions of employed people, as in the rest of the region’s economies.

The minister reiterated, however, that these promising results are not enough and emphasized the government’s commitment to redouble efforts to leverage economic growth further to improve people’s quality of life by accelerating the creation of decent jobs, improving the quality of public services, and tackling inequality.

About the bulletin

In the coming weeks, the Ministry of Economy, Planning and Development (MEPyD), in coordination with the National Statistics Office (ONE) in the framework of the Inter-Institutional Technical Committee on Poverty, will be releasing the Official Statistics Bulletin on Monetary Poverty, which will present in greater detail the evolution of poverty in the Dominican Republic for the period 2000-2022, with emphasis on 2021-2022.

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