Arturo Peguero, president of the Dominican Free Zone Association, warns that, contrary to expectations held at the start of the year, the second half prospects for 2003 are not good. He said that during the first quarter of the year, orders were up 6%, but during the April-June quarter they declined, and demand has since slumped. He told El Caribe that while there was a 4.2% growth during the first half of the year, when including the results of the third quarter, there has been only a 0.7% growth for the year as a whole. Peguero forecasts 0% growth by year’s end, crushing the prospects for growth evident in January. This is despite the devaluation of the peso, which make Dominican exports more competitive compared to those of Central America, where labor costs are lower. “?Imagine the closings of businesses if there had not been a devaluation,” said Peguero.
According to data from the Department of Commerce, the first eight months of exports brought in US$1.409 billion, compared to US$1.399 billion for the same period last year.
Peguero attributed the sluggishness of US demand to the situation in Iraq. Peguero does not expect the situation to change because of market crowding caused by China, whose exports have increased 50%.