[FONT=Verdana,Arial,Helvetica,sans-serif]The Dominican economy, the fastest-growing in Latin America, is expected to benefit strongly from CAFTA.
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BY [Latin Business] CHRONICLE STAFF
.. Hanesbrands has invested more than $70 million in the initial stage of a facility to manufacture fabrics located in Bonao, at the export processing zone Dos Rios. It employs around 1,000 people. All in all, Hanesbrands employs 10,000 people in th
e Dominican Republic. That makes it the company?s largest manufacturing center in Latin America and second only to the United States, where it employs 13,000 workers, according to Hanesbrands spokesman Matt Hall. The Dominican facilities manufacture popular products like Hanes T-shirts and Playtex bras.
CAFTA
Although Hanesbrands has been in the Dominican Republic for 20 years, the free trade agreement with the United States (known as DR-CAFTA or CAFTA) has played a role in the company?s recent investment decisions. "CAFTA was a very important factor in our decision to [start] the [new] textile facility in the Dominican Republic" Hall says.
The impact of DR-CAFTA on investors will be significant," Manning says. "Many international companies are looking to the Dominican Republic as a platform to export to the United States due to the favorable and more flexible rules of origin negotiated in the agreement, the best to date in any such bilateral pact." Examples include shoe manufacturers from Spain and electronics firms from Korea, he says. "These investors will have better protection against violations and favorable, more effective means of dispute settlement, including contracts with the government," Manning says.
And the Dominican customs service has reduced the time it takes to process imported goods to 24 hours, while labor and environmental laws will be enforced under stiff penalties for noncompliance, he points out. "The best stimulant for investment and job creation, however, will be the transparency under which the government is committed to operate under new laws and regulations recently promulgated in preparation for DR-CAFTA," Manning says. "A similar commitment has been made to eliminate bribery and corruption in international trade."
CAFTA is also expected to help Dominican companies and consumers, who will be able to source less expensive products, experts say. "We expect some of the competitive pressure to bring prices down," says Eddy Martinez, a cabinet minister and executive director of the Dominican investment agency CEI-RD.
Textile and apparels will be among the top winners of CAFTA, thanks to the new rules of origin regulations, Martinez says. "We?re beginning to see more interest from U.S. companies that previously were not looking at the region, but because of the agreement, there?s a new awareness on a global scale," he says.