Caribbean Islands » Introduction

Basic Economic Facts

The Dominican Republic had one of the fast growing economies in the world in the 1990s. After a decade of little to no growth in the 1980s, the Dominican Republics economy boomed, expanding at an average rate of 7.7% per year from 1996 to 2000. Tourism (the leading foreign exchange earner), telecommunications, and free-trade-zone manufacturing are increasingly important industries, although agriculture is still a major part of the economy. The Dominican Republic owed much of its success to the adoption of sound macroeconomic policies in the early 1990s and greater opening to foreign investment.

The Dominican Republics most important trading partner is the United States (87% of export revenues); other markets include Canada, Western Europe, and Japan. The country exports free-trade-zone manufactured products (garments, footwear, etc.), nickel, sugar, coffee, cacao, and tobacco, and it imports foodstuffs, petroleum, industrial raw materials, and capital goods. On September 5, 2005, the Dominican Congress ratified a Free Trade Agreement with the U.S. and five Central American countries, known as CAFTA-DR. The stock of U.S. foreign direct investment (FDI) in the country in 2004 was $1.0 billion, up from $816 million in 2003, much of it directed to the tourism sector, to free trade zones, and to the telecommunications sector. Remittances were close to $3 billion in 2004.