Dominican Republic 

Dominican Republic country policy

Policy established 12 September 2006

• ILC, bank guarantee or central public guarantee (unconditional)
• The country ceiling is 1000 mln euro
• Early warning signal 150 mln euro
• - of which was used as at 2011-08-31 10 mln euro

Country class: 5

Dominican Republic country facts

Atradius Dutch State Business Economic Research
Country Report last updated :  8 March 2010
Country :  DOMINICAN REPUBLIC  

Political Situation
Stable

Head of state
President Leonel Fernandez; new presidential elections in 2012, Fernandez not allowed to content: consecutive re-election eliminated.

Form of government
Government of the Partido de la Liberación Dominicana, mid term elections in May 2010.

Internal Economic Situation
28-Month Imf Stand-By Signed In Nov 2009

General situation
Still below trend lower real GDP growth in 2010 (3%), generated by domestic demand, only NFB negative contribution. Increasing inflation to 6% (monetary easing, oil prices, increased govt. spending), budget deficit of 3% GDP. Poor public finance, debt service as share of revenue 15%. Total public debt 43% GDP. Deficit on primary balance in 2010. Unfunded liabilities (arrears to electricity generators). Banking sector in better shape after 2004 crisis. Well capitalised, low NPL’s (3%). Lower domestic credit growth, but rising lending to public sector (low maturity, roil-over risks). Ongoing credit restraints add pressure to sector. High unemployment, weak corporate profitability. Gradual depreciation of DOP.

External Economic Situation
Poor Liquidity, Poor Ca On Bop

Main sources of foreign exchange
Tourism, private transfers, maquiladora (industrial) products, sugar, tobacco, nickel.

Main foreign markets
United States (84%), EU (7%), Latin America (4%).

Main expenses of foreign exchange
Raw material/intermediate products (destined for maquilas).

Balance of payments 
Strong reliance on US for trade, FDI and remittances, deteriorating trade deficit (“higher import price”) in 2010. still access to external bank loans. As oil importer, terms of trade deteriorate. Rebound in tourism is measured.