The Central Bank of the Dominican Republic reports that remittances are at US$4.8 billion for the first half of 2022. The Central Bank says if the present trend continues, remittances could reach a record US$10 billion by the end of 2022.
The Central Bank observes that the remittances in June 2022 were only US$66 million less than those in 2021 even when the US government has discontinued the Covid-19 financial support.
Total remittances for January to June 2022 were US$4,861.1 million. The amount is US$1,403.7 million more than the amount received in the first half of pre-pandemic year 2019.
The Central Bank highlights that the US$803.8 million received in June 2022 reaffirm a new level of regular monthly remittance flows has been reached. This compares to the US$499.2 million average received from 2015-2019, before the pandemic.
The Central Bank attributes the difference to the increase in number of Dominicans employed in the United States, the country from where around 84.6% of the remittances come from. The unemployment rate is at 3.6% in June 2022. In particular, the US government reports 4.3% unemployment rate for Hispanics.
Remittances from Spain, the second in Dominicans living abroad, were up 6.4%.
34% of remittances are received by persons domiciled in the National District, 14.4% in Santiago and 9% in the province of Santo Domingo. That is, 57.3% of remittances are received in the largest metropolitan areas of the country.
The BCRD sees remittances, exports, foreign direct investment and the recovery of tourism, with record numbers of tourist arrivals, are all positively impacting the economy.
The Central Bank says that these developments contribute to a greater flow of foreign currency into the country and are helping maintain the relative stability of the exchange rate. The exchange rate appreciated 4.8% at the end of June compared to December 2021.
The Central Bank explains that these elements, together with the country’s strong macroeconomic fundamentals, indicate that the Dominican Republic is prepared to accommodate external shocks from today’s complex and uncertain international environment.
The greater flow of foreign exchange has resulted in international reserve level of US$14.45 billion at the end of June 2022, representing 13.3% of GDP and equivalent to about six months of imports. These metrics exceed the levels recommended by the IMF, contributing to the Dominican Republic maintaining a favorable external position, projecting an inflow of remittances by the end of 2022 of around US$10 billion and a current account deficit between 3% and 3.5% of GDP.
The Central Bank reiterates that it remains vigilant to continue taking the necessary measures to counteract the impact on the Dominican economy of the prevailing challenging international environment, in order to guarantee price and exchange market stability.
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Central Bank
13 July 2022