Dominican economy continues strong in June 2022

The Central Bank reports that the Monthly Economic Activity Indicator (IMAE) registered a remarkable inter-annual expansion of 5.8% in the month of June, higher than the 4.8% observed in May and the 4.7% of April 2022. The average growth of the IMAE for January-June 2022 stood at 5.6% compared to the same semester of the previous year.

The Dominican economy continues to benefit from an increase in foreign direct investment that reached US$1.87 billion from January to June 2022, for an 8% expansion over the same period in 2021.

Tourism arrivals and receipts reached a record US$4.12 billion, with outlook for US$8.4 billion in receipts by year’s end.

Remittances were US$4.86 billion for the first half of the year, up 7.6% on a 12-month period, and a 40.6% increase when compared to the pre-pandemic 2019. By year’s end, remittances are expected to reach US$10 billion. In June alone, remittances were US$803.8 million.

Exports were up 16.5% for the semester compared to the same period in 2021, with free zone manufacturing reporting a 8.6% increase.

The booming external sector resulted in international reserves at around US$14.45 billion as of June 2022, or 13.3% of GDP and about six months of imports, exceeding the metrics recommended by the International Monetary Fund (IMF).

The influx of hard currency has been such that the peso appreciated 4.8% at the end of June.

The outlook remains positive. The Gross Domestic Product (GDP) is at 5.0%, a rate close to potential, according to the Central Bank’s forecasting system and in line with the level expected by multilateral organizations such as the International Monetary Fund (IMF) and the World Bank.

The behavior of the Dominican economic activity during the January-June 2022 period is mainly supported by the sectors that evidenced higher growth rates in their real added value, among which are: hotels, bars and restaurants (34.3%), health (11.3%), free zone manufacturing (8.6%), public administration (8.5%), transportation and storage (8.0%), commerce (6.6%), energy and water (6.3%), financial services (5.6%), among others.

The Dominican Republic has yet to feel the brunt of the announced recession in the United States.

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Central Bank

2 August 2022