Historically, the commercial exchange between the Dominican Republic and Haiti has been significant compared to other countries in the region. For example, exports to Haiti reached US$ 206.81 million until 2020, making it the third-largest destination for Dominican products after the United States and India.
Experts believe that the decision of the Dominican Republic to close its borders with Haiti could have negative economic consequences. The trade between the two nations currently amounts to about 880 million dollars, which has declined in recent years due to political, social, and economic challenges in Haiti.
The Dominican Republic has a positive trade balance with Haiti, exporting almost 800 million dollars compared to importing only about 32 million dollars. This has an impact on major commercial areas and informal cross-border trade. The government will also need to subsidize many producers.
Economists argue that the closure of the border should be considered not only in economic terms but also from a social perspective, and more effective pressure mechanisms should be explored before resorting to drastic measures.
The total closure of the border will have a daily negative impact of 4.0 million dollars on the export side of the country and 4.4 million dollars on bilateral trade. This setback will harm both Dominican producers and merchants, as well as consumers and merchants in Haiti.
In the past five years, the trade flow between the Dominican Republic and Haiti has grown by 25.0%, with Dominican exports accounting for 92.0% of this growth.
President Luis Abinader announced on Thursday that the border with Haiti would be closed on Friday after discussions between both governments to address the crisis through the construction of an irrigation canal on the border’s Masacre River.
Other measures taken by the Dominican National Security Council include the suspension of entry for those involved in the conflict, the halt of visa issuance to Haitian citizens, the reactivation of a channel for water supply, and the initiation of a long-term solution in the form of dam construction.