Synopsis "Dominican Republic: Investment Climate Statement 2015"
Over the last few decades, the Dominican Republic has adopted policies of greater openness to international trade and investment. As a result, foreign direct investment (FDI) has played a prominent role in its economic development. However, significant systemic problems can make investing in the country a risky undertaking. Foreign investors cite a lack of clear, standardized rules by which to compete and a lack of enforcement of existing rules. Complaints have included corruption, requests for bribes, delays in government payments, the time and cost necessary to enforce contracts, and non-standard procedures in customs valuation of imported goods, as well as product misclassification as a means of negating CAFTA-DR benefits and increasing customs revenues. The Dominican authorities have carried out some reform efforts aimed at improving transparency and effectiveness of laws affecting competition. Nevertheless, corruption, the need for more reform, and better implementation of existing laws are openly and widely discussed as key public grievances.President Danilo Medina, who took office in August 2012, has made notable efforts to promote government accountability and macroeconomic stability. In 2014, the Dominican economy grew 7.3 percent, according to the Central Bank, making it one of the countries in Latin America with the highest growth. Growth was led by the mining sector (particularly gold), with 20.3 percent growth, the construction sector, with 13.8 percent growth, and by local manufacturing, agriculture, and free trade zone production. The fiscal deficit, at 2.6 percent of GDP in 2014, was down slightly from the previous year. While the macroeconomic situation has stabilized, the investment climate in the coming years will largely depend on sustaining the political will to make and to implement reforms necessary to promote competitiveness and attract further foreign investment.
