The National Competitiveness Council will step up efforts to strengthen industry clusters as part of a strategy to bolster local competitiveness, as reported in Hoy newspaper. A “cluster” is the term for the geographical concentrations of interconnected companies, specialized suppliers, service providers and associated institutions in a particular field.
In an interview with Hoy’s economic reporters, industrial advisor Antonio Isa Conde, executive director Andres Vanderhorst, small business advisor Claudio Adams, advisor Elka Scheker, and private sector representative Jaime Moreno spoke on the importance of enhancing the local ability to compete. The group highlighted the successful cases of the tourism cluster in Bayahibe, which achieved Blue Flag status for its beach, as well as mango and vegetable clusters based in Dominican farm areas.
Vanderhorst believes that the DR has a lot of work to do, as in the past few years it has declined from 50th place among 80 countries, to 80th place among 102 countries in the international competitiveness ranking conducted by the World Economic Forum. The index rates countries on governmental performance, the technological standing of the government, the state of the economy and the business climate. Vanderhorst said that it is imperative that the country climb up in the rankings if it is to attract foreign investment. Isa Conde says that the council is identifying measures to be taken, many of which are administrative. He pointed out that the country has been competitive previously, but only because of our low-cost workforce and the natural resources we have at our disposal.
The original clusters programs were financed by a US$10-million cooperative grant from the USAID organization. Vanderhost said that the CNC has received new financing equal to RD$13 million designated to improving the competitiveness of the local private sector. Those industries that will receive support are agriculture, manufacturing, small- and medium-sized businesses and the handicraft industry.
The organizations striving to enhance competitiveness in the DR are the Fundacion Global Democracia y Desarrollo and the Association of Industries of the Dominican Republic (AIRD).
A Listin Diario article informs today that the Dominican Republic imports US$13 of goods from Central America, a country with which it has a free trade agreement, for every US$1 of goods exported. The newspaper highlights this trade deficit as an example of the lack of competitiveness of goods produced in the DR. Local competitiveness suffers because of red tape at the time of export, the lack of a national brand, high energy costs, high shipping costs and little aggressiveness from Dominican exporters.