Dominican economy: 2.4% growth in 2023

Santo Domingo.- The Dominican Republic’s Central Bank (BCRD) reported a 2.4% year-on-year expansion in the economy for 2023, surpassing initial projections and exceeding the Latin American average growth estimated at 2.2% by the World Bank.

The Monthly Indicator of Economic Activity (IMAE), a key indicator of robust economic performance, recorded a 4.7% year-on-year expansion in December 2023, marking the highest monthly rate of the year. This reflects sustained growth, with a 4.2% increase in the last quarter of 2023, surpassing rates observed in previous quarters.

Inflation, on the other hand, showed a downward trend, ending 2023 with an annual rate of 3.57%, the lowest in the last five years. This achievement positions the Dominican Republic below the central target range of 4.0% ± 1.0% set in the monetary program.

The tourism sector played a pivotal role in economic growth, with tourism income reaching US$9,828.9 million, a 16.9% year-on-year increase from 2022. Remittances received in 2023 amounted to US$10,157.2 million, growing by 3.1% compared to the previous year.

Foreign direct investment (FDI) also saw a significant increase, reaching US$4,381 million in 2023, a 9.2% rise from the previous year. Sectors such as tourism, energy, and real estate stood out in this FDI increase.

The construction sector, with positive variation rates since July 2023, has contributed to economic recovery. The facilitation of loans to productive sectors and households, along with reduced interest rates, played a role in this positive trend.

In the international context, the United States, the primary trading partner, recorded a 2.5% year-on-year economic growth in 2023, positively impacting the Dominican Republic’s economic performance.

These optimistic figures position the Dominican economy for favorable performance in 2024, with growth projections of 5%, one of the highest in Latin America. The expectation is that monetary stimulus, public investment, and continued foreign direct investment will further boost economic activity while maintaining inflation within established parameters.