|The Dominican Republic is a middle-income developing country primarily
dependent on agriculture, trade, and services, especially tourism.
Although the service sector has recently overtaken agriculture as the
leading employer of Dominicans (due principally to growth in tourism,
energy, telecommunications, and Free Trade Zones), agriculture remains the
most important sector in terms of domestic consumption. Tourism accounts
for nearly $1.5 billion in annual earnings. Free Trade Zone earnings and
tourism are the fastest-growing export sectors. Remittances from
Dominicans living in the United States are estimated to total more than
$1.5 billion per year.
Following economic turmoil in the late 1980s and 1990, during which the GDP fell by up to 5% and consumer price inflation reached an unprecedented 100%, the Dominican Republic entered a period of high growth and moderate inflation. GDP in 2001 grew by only 3.0% following 5 straight years of growth above 7.0%. The inflation rate in 2001 was about 5%.
Despite a widening merchandise trade deficit, tourism earnings and remittances have helped build foreign exchange reserves. The Dominican Republic is current on foreign private debt and has agreed to pay arrears of about $130 million to the U.S. Department of Agriculture's Commodity Credit Corporation. The government faces several economic policy challenges--high real interest rates, poor tax-collection rates, and reduced demand for Dominican exports due to the slowdown in the world economy. Years of tariff protection for domestic production have left the economy vulnerable in a rapidly integrating global economy.
GDP: purchasing power parity -
$48.3 billion (2000 est.)
SOURCES: The World Factbook, U.S. Department of State
Mother Earth Travel > Country Index > Dominican Republic > Map Economy History