Santo Domingo.- The Dominican Republic continues to attract significant foreign direct investment in the Caribbean and Central America. However, a recent report from the United States points out “numerous systemic problems” that affect investors’ financial decisions. These issues include the lack of clear competition rules, lengthy administrative and judicial decision-making processes, transparency issues, and the poor implementation of existing laws.
The report recognizes the efforts of President Luis Abinader’s government to address these challenges and improve democratic institutions. Key government efforts include promoting prosecutorial independence, combating administrative corruption, appointing competent professionals to leadership roles, and implementing a civil asset forfeiture law.
Although there have been some improvements in recent years, corruption in the government, including the judiciary, remains a concern for American companies and investors operating in the Dominican Republic. The report also highlights the tendency of the Abinader administration to withdraw important reform measures when faced with public criticism.
The Dominican Republic actively seeks foreign direct investment through tax exemptions and incentives. Key sectors attracting investment include tourism, real estate, telecommunications, free zones, mining, and film production.
Additionally, the Dominican Republic’s participation in the Central American-Dominican Republic Free Trade Agreement (DR-CAFTA) provides significant advantages for foreign investors. This agreement encourages competition, strengthens the rule of law, and expands access to quality products.
The report also raises concerns about the Dominican Republic’s vulnerability to climate change. Despite low greenhouse gas emissions, the country is susceptible to extreme weather events and urban growth, which could impact multiple socioeconomic sectors. The report acknowledges President Abinader’s Water Law Project and the country’s commitment to resource sustainability and environmental protection.
In summary, the US State Department report offers detailed information on the business climate in the Dominican Republic, highlighting its attractiveness for foreign investment while acknowledging the challenges faced by investors.