DR-CAFTA triples Dominican Republic’s economy

[Dolores]

On occasion of the traditional Thanksgiving Day luncheon at the American Chamber of Commerce, the US Embassy Charge d’Affaires Patricia Aguilera spoke and gave a wrap-up of what the DR-CAFTA, the Dominican Republic-Central America Free Trade Agreement has meant for the US-DR relationship.

Signed in 2004, Aguilera says the agreement has cemented the long-shared robust economic bonds between both countries.

Twenty years later, the agreement continues to yield significant benefits for both nations. Aguilera highlighted the DR-CAFTA has been instrumental in tripling the Dominican Republic’s economic growth compared to the regional average.

“Since DR-CAFTA came into effect, three million Dominicans have been lifted out of poverty, and the middle class has expanded significantly,” said Aguilera. “This is a testament to the power of free trade and sound economic policies.”

Aguilera attributed the...

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[cavok]

Too bad they don't reciprocate.

 

[drstock]

I wonder if that agreement will continue under the coming US administration or whether they will be introducing tariffs on Dominican goods.

 

[cavok]

They need to tax the crap out of Dominican products. Fair trade is not a one-way street.

 

[Manuel01]

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I hope this finally puts an end to the yearly discussion about eliminating the free import of goods up to 200$.

 

[bob saunders]

They need to tax the crap out of Dominican products. Fair trade is not a one-way street.

When America eliminates their farm subsidies, sure.

 

[monfongo]

Try to find a good American hot dog or a cheap can of Campbell's soup, i could go on forever.

 

[NanSanPedro]

Try to find a good American hot dog or a cheap can of Campbell's soup, i could go on forever.

Bravo has Campbells. But no way on the real hot dogs.

 

[JD Jones]

Bravo has Campbells. But no way on the real hot dogs.

Bravo, Nacional, Sirena, Ines.. almost all supermarkets big and small have Campbells.

Nacional and Jumbo have U.S. hot dogs.

 

[cavok]

There's plenty of Campbells soup here on the north coast - at double the price in the US. The only US hotdogs I've seen are Oscar Meyer and they're the small ones - at double the cost in the US. No surprise that CAFTA has tripled the DR's economy. The US cut tariffs on DR products and the DR cut none.

 

[NanSanPedro]

Bravo, Nacional, Sirena, Ines.. almost all supermarkets big and small have Campbells.

Nacional and Jumbo have U.S. hot dogs.

I should be at Jumbo next week. It may be that I just missed them as I always buy my kid Emilio's as he likes them.

 

[bob saunders]

There's plenty of Campbells soup here on the north coast - at double the price in the US. The only US hotdogs I've seen are Oscar Meyer and they're the small ones - at double the cost in the US. No surprise that CAFTA has tripled the DR's economy. The US cut tariffs on DR products and the DR cut none.

In 2022, U.S. goods exports to the Dominican Republic amounted to $14.0 billion, while U.S. goods imports from the Dominican Republic totaled $6.9 billion.

 

[cavok]

In 2022, U.S. goods exports to the Dominican Republic amounted to $14.0 billion, while U.S. goods imports from the Dominican Republic totaled $6.9 billion.

A large part of that is expensive US cars. Tell me about how the DR cut tariffs on the import of US cars.

 

[playacaribe2]

In 2022, U.S. goods exports to the Dominican Republic amounted to $14.0 billion, while U.S. goods imports from the Dominican Republic totaled $6.9 billion.

Two important takeaways from those figures:

1. The DR obviously needs more goods/services from the US than we need from them;
2. But the real takeaway is what products were/are entering duty/tax free. One area of which I have familiarity is in the automobile import space. The DR complied with the spirit of DRcafta, but then imposed a 17% first placa.....which was nothing more than a DRCafta tax work around. So it is not the imbalance so much as it is a) demand and b) what goods/services are taxed.

Car imports exceeded 2.5 billion of that 14 billion figure in the article you cited.


Respectfully,
Playacaribe2

 

[jaguar86]

Two important takeaways from those figures:

1. The DR obviously needs more goods/services from the US than we need from them;
2. But the real takeaway is what products were/are entering duty/tax free. One area of which I have familiarity is in the automobile import space. The DR complied with the spirit of DRcafta, but then imposed a 17% first placa.....which was nothing more than a DRCafta tax work around. So it is not the imbalance so much as it is a) demand and b) what goods/services are taxed.

Car imports exceeded 2.5 billion of that 14 billion figure in the article you cited.


Respectfully,
Playacaribe2

Does the 17% first placa also need to be paid for new cars purchased inside the DR?

 

[bob saunders]

Two important takeaways from those figures:

1. The DR obviously needs more goods/services from the US than we need from them;
2. But the real takeaway is what products were/are entering duty/tax free. One area of which I have familiarity is in the automobile import space. The DR complied with the spirit of DRcafta, but then imposed a 17% first placa.....which was nothing more than a DRCafta tax work around. So it is not the imbalance so much as it is a) demand and b) what goods/services are taxed.

Car imports exceeded 2.5 billion of that 14 billion figure in the article you cited.


Respectfully,
Playacaribe2

Sure but are they all American made?

 

[playacaribe2]

Does the 17% first placa also need to be paid for new cars purchased inside the DR?

The 17% first placa is required to be paid whether new or used whether purchased new inside the DR or bought new in the US and shipped there.

Respectfully,
Playacaribe2

 

[playacaribe2]

Sure but are they all American made?

In order to be duty free under DRCafta, they must be US made, which can easily identified by the first number in the vehicle identification number.

If not, applicable duty/taxes must be paid, in addition to the 17% first placa.

Not to be lost in all this is the additional 18% ITBIS.


Respectfully,
Playacaribe2

 

[bob saunders]

https://worldpopulationreview.com/country-rankings/automobile-tariffs-by-country
looking at this page you can see many countries have even higher tariff and tax rates than the DR on importing automobiles.