Jose Antonio Flaquer Lopez, president of the Dominican Association of Exporters, as reported in Hoy newspaper, said that to restore competitiveness to productive sectors it is absolutely necessary that the Central Bank halt policies in effect that restrain the exchange rate to levels that are not on true exchange parity. Speaking on occasion of the annual dinner of the Dominican Exporters Association said that if there is not a change, there will be more reductions in exports in and outside the free zones and tourism will be affected. He called for an equilibrium that be met in a prudent, orderly way so that players may make adjustments, without traumas. He said that the present rate is not one of equilibrium, and the sectors that generate hard currency have been losing competitiveness. He said the appreciation in 2004 was a time when exporters were able to compensate for the many years when the rate was below parity levels. He said at the present time the rate has the effect of a tax on exports, and a subsidy in favor of imports. He proposed the gradual elimination in the shortest time possible of the exchange commission. He proposed zero taxes on production and elimination of red tape that affects production and competitiveness.
He said the country has not had leadership that has shared the vision of the strategic importance of the export sector. He said there has been a lot of talk about the importance of developing exports, “but the difference between dialogue, words and the vision of national commitment, is that the latter makes this a non-negotiable obligation, where we want to and are obliged to go.
He said there has been a setback in exports over the past 25 years. He explained that while the country exported US$974 million in 1980, outside of free zone exports, in 2004 this had increased to US$1334 million. But he explained that if accumulated inflation is taken into account, 160% according to US Treasury figures, then the country in 2004 in real terms (80s dollars) exported US$512 million, half of what was exported back then.
Flaquer said that high interest rates on loans and high taxes also put Dominican exporters in disadvantage with their international competitors.