The slightly positive economic dynamics of exports recorded in June by theISTAT it is mainly due to the increase in sales of intermediate goods (+6,1%) while those of capital goods decreased (-4,5%). On the import side, there are increases on a monthly basis for durable consumer goods (+13,2%), capital goods (+5,3%) and intermediate goods (+1,8%), while purchases are down energy (-2,8%) and non-durable consumer goods (-1,2%). In the second quarter of 2021, compared to the previous one, exports increased by 6,3%, mainly due to the higher sales of energy (+27,4%), capital goods (+7,9%) and intermediate goods (+6,8 .10,9%). In the same period, imports recorded an economic increase of 25,2%, to which the strong increases in energy purchases (+16,2%) and intermediate goods (+XNUMX%) contributed in particular. Every year, exports increased on an annual basis by 23,3%, with extraordinarily high growth for the energy sector (+191,6%). Imports showed a broader tendential increase (+31,1%), extended to all groupings, excluding non-durable consumer goods (-15,5%).
The estimate of trade balance in June 2021 is equal to +4.790 million (+4.676 in June 2020). The surplus in the trade of non-energy products increased (from +6.265 million in June 2020 to +7.517 million in June 2021). Furthermore, exports are significantly increasing on an annual basis to almost all the main non-EU27 partner countries: the largest increases concern MERCOSUR (+71,5%), USA (+35,7%), Turkey (+30,2 .28,0%) and ASEAN markets (+21,2%). Sales to Japan decreased (-119,6%). The trend increases recorded by OPEC countries (+69,1%), MERCOSUR (+67,2%), Russia (+54,8%) and Turkey (+10,0%) were particularly large. Only imports from China are down (-XNUMX%).
In this scenario, the Dominican Republic from 2000 to 2019 it was among the most dynamic economies in the entire Caribbean area (+5,2% per year on average, further accelerating to 6,1% from 2015 onwards) and only the impact of the pandemic forced the country into recession (-6,7%). According to the IMF, the recovery in 2021 and 2022 will be rapid (+5,5% and +5%, respectively) and will benefit not only from the government's counter-cyclical stimulus measures but also from the positive effects of faster-than-expected US growth, first commercial partner and main source of FDI, tourist flows and remittances. What differentiates the Dominican Republic from other economies in the area is less dependence on tourism (16% of GDP against 25% in neighboring markets), especially cruises, and a well-diversified economy.
The opening to trade and investment from abroad by the governments that have followed one another in the last decade makes the country an attractive destination for investments. FDIs are concentrated in the tourism, real estate, telecommunications, mining and financial sectorsas well as in free trade areas. The latter are 74 and provide for exemptions of up to 100% of national and local taxes. There are no general limits on foreign ownership and control of companies in the country. In the context of National Development Strategy 2030 the first law on public-private partnerships (PPP) was also approved in February 2020, which could give a further boost to the infrastructural development of the country, which is lacking in the electricity sector. However, there are critical issues within a highly unequal context, characterized by high poverty rates (25% of the population), corruption, crime and an inefficient judicial system. The strengthening of institutions and the rule of law is therefore fundamental and must go hand in hand with a simpler and fairer tax system, since the current one, as pointed out by SACE, is full of loopholes and gray areas.
Recent news is the interruption of diplomatic relations between the Dominican Republic and Taiwan, necessary for a rapprochement with Beijing (China does not maintain diplomatic relations with all the nations that recognize Taiwan). In particular, the possibility of participating in the project is appealing Belt and Road, in addition to being able to benefit from the huge investments that Beijing has in the pipeline on the national territory and which concern seven infrastructure projects for a total amount of 3,1 billion dollars.
In any case, there are good reasons to invest in the small but populous Caribbean country (10,7 million inhabitants), including:
- an advantageous geographical position between North America and Latin America;
- a series of very interesting incentives such as free zones, exemption from customs duties (only for some sectors) and ease of setting up a company on site;
- a young and connected population (the internet penetration rate is close to 60%);
- one of the best levels of infrastructural development in the whole area.
Commercial relations between Rome and Santo Domingo are excellent and have "exploded" thanks to the increase in Made in Italy exports which, in 2016, reached 36%, going from 252 to 343 million euros. For Italy, the Dominican Republic is the seventh outlet market in Latin America. Overall trade, after exceeding 400 million in 2019, fell back to 358 million last year. Our country is the second European supplier after Spain (and the eighth in the world) but there is room for a further leap in quality considering the deep historical and cultural ties between the two countries. If Hispaniola was, in fact, the first European colony founded by Columbus in the New World in 1492, the Italians, and in particular some Genoese merchant families, were protagonists in the war that led to the independence of the Dominican Republic from Haiti in 1844. More today some of the main families in the country are of Italian origin and have interests that span various sectors. This represents a good roadmap for a consolidation of trade flows: in the first 5 months of 2021 the cumulative is in line with the same period of 2019, with the aim of exceeding the threshold of 350 million.
