UASD Dean: Trump tariffs may boost Dominican economy

Santo Domingo.- Antonio Ciriaco, dean of the Faculty of Economics at the Autonomous University of Santo Domingo (UASD), examined the potential effects of new tariffs that the U.S. government plans to implement starting February 4. While these tariffs primarily target Mexico and Canada, Ciriaco highlighted that they could indirectly impact the Dominican Republic by shifting investment flows.

He explained that if Mexican industries face higher costs due to tariffs, some companies might redirect investments to the Dominican Republic to take advantage of the DR-CAFTA trade agreement, which offers tariff benefits for exports to the U.S. This could create a “trade diversion” effect, making the country an attractive alternative for manufacturers looking to avoid increased costs. However, he cautioned that this advantage depends on DR-CAFTA remaining intact.

Ciriaco also addressed concerns about recent trade tensions, such as President Luis Abinader’s decree imposing quotas and tariffs on U.S. rice imports, which may conflict with DR-CAFTA provisions. Despite these challenges, he emphasized that the agreement has historically benefited the Dominican Republic and could continue to do so if trade relations are carefully managed.