Héctor Valdez Albizu: “Tourism is the spearhead of Dominican economy”

Santiago de los Caballeros, DR.- The governor of the Central Bank of the Dominican Republic (BCRD), Héctor Valdez Albizu, said that tourism is the spearhead of the economy, as it generated revenues of more than US$8.4 billion in 2022, with the arrival of 8.5 million non-resident visitors, of which 7.2 million arrived by air and 1.3 million on cruise ships.

In his conference “Economic News & Prospects 2023,” during the annual luncheon organized in Santiago de los Caballeros by the Association of Industrialists of the Northern Region (AIREN), Valdez Albizu highlighted the importance of the Northern region, which “in 2022 received more than 1.1 million tourists through its airports and 80% of cruise ship passengers.”

Valdez Albizu also announced that “according to the latest estimates of the BCRD, inflation would enter the target range of 4% ± 1% at the end of May, earlier than expected,” and expressed that “this achievement would provide the necessary space for the Central Bank to adopt timely measures that will contribute to relaunch growth during the rest of the year, preserving macroeconomic stability.”

With respect to remittance flows, in 2022, the arrival of almost US$10 billion was accounted for throughout the national territory, of which 40% were destined for the Cibao. Meanwhile, foreign direct investment (FDI) exceeded US$4 billion last year, of which nearly US$1 billion went to projects located in this area.

In this context of high foreign exchange generation and in order to avoid an abrupt appreciation of the Dominican peso that would harm the competitiveness of foreign sector activities, the Central Bank has been buying significant amounts of dollars from financial intermediaries through auctions on its electronic platform.

Valdez Albizu stated in this regard that “during 2022, the Central Bank made net purchases of foreign exchange for some US$1.6 billion, which has contributed to the strengthening of international reserves that stand at around US$16.3 billion to date.”

In his lecture, the governor noted that “the Central Bank has always recognized the contribution of the Northern region to the growth of the nation, and for that reason created in 2017 the Regional Studies and Statistics Division, based in the Santiago Regional Office.”

He also noted that “research carried out points to the fact that the fourteen provinces of this geographic enclave contribute between 32% and 38% of the national economic activity.”

Other conclusions reveal that “the Cibao has remained as a leader in agricultural production, being the main food supplier of our country, supplying about 55% of the national agricultural production. The Cibao concentrates 77% of the area planted with cocoa and more than 90% of the national production of tobacco.”

On the other hand, he reported that “the Northern region stands out in the free trade zone sector, concentrating more than half of the industrial parks in the country, which house almost 400 companies of this type. In addition, this activity was one of the most important in the recovery process after the pandemic and has contributed to sustain employment, generating more than 200 thousand direct jobs nationwide, of which about 70 thousand are in the Cibao region.”

According to Central Bank estimates, the Northern region has an incidence of 40% of the construction activity at the national level, in addition to housing several of the main cement and steel producing companies in the country. The region is also home to the largest mining companies that contribute the most to the national gross domestic product (GDP).

The governor said that “this economic boost of the Cibao is reflected in the development of the financial system, concentrating 37% of the country’s banking offices, which has allowed greater access to financing for businesses and households. In addition, through the Santiago Regional Office, around 40% of the processing of banknotes, deposits and cash withdrawals by financial intermediaries is carried out.”