| Dominican Republic | Feb 04, 2015
WHEN THE BOAT COMES IN Shipping in the Dominican Republic has seen consistent growth over recent years, as investment from international firms continues to inject capital into the sector and […]
WHEN THE BOAT COMES IN
Shipping in the Dominican Republic has seen consistent growth over recent years, as investment from international firms continues to inject capital into the sector and free zones expand. A total of 4.2 million metrics tons of cargo was loaded in Dominican ports in 2012, while over 13.7 million tons was unloaded over the same period. According to World Bank sources, 1.5 million TEUs passed through the port system in 2012, compared to 1.4 million in 2011.
The oldest port in the so-called “New World,” situated on the mouth of the river Ozama and docked at by Christopher Columbus is part of Dominican maritime heritage. Today it serves a wide range of purposes, including general cargo and fuel handling, and hosts two cruise ship terminals at Don Diego and Sans Souci. Both are managed by Sans Souci Ports S.A. and have recently undergone extensive refurbishing. The Don Diego terminal pier is 400m in length, while Sans Souci serves as a homeport for prominent cruise lines. Over 350 ocean-going ships utilized Santo Domingo’s ports in 2012, 13 of which were cruise vessels.
Haina, located 11km from Santo Domingo, is the preeminent Dominican port, and accounts for around 70% of all cargo handled. It consists of 15 ship berths, which can take liquid and dry bulk containers, roll on/roll off, and general break bulk cargo. The facility is divided in two by the Haina river, which separates the docks into Haina Oriental, the larger of the two, and Haina Occidental, on the west bank of the waterway. During the first six months of 2013, 148,812 TEUs were handled at the twin port, marking 2.3% YoY growth from 145,426 TEUs. Maritima Dominicana S.A.S. data for that year put the number of oceangoing vessels visiting the facilities at 1,686.
PIISA is a major industrial park of close to 150,000 sqm located less than 10 km from the port, in the southwest of Santo Domingo. It has been providing internationally certified services and space to multinational firms since 1985. Other prominent harbors are AES Andres’ LNG import terminal at Boca Chica, the Complejo GNL del Este in San Pedro de Marcoris, and the Punta Nizao Oil terminal between Santo Domingo and Barahona. A major new maritime development, the $65 million Amber Cove cruise center near Puerto Plata, will become a key regional center for the tourism segment, and is expected to transform the area and dramatically increase tourist numbers when opened for business in October 2015. According to USA Today, the 30-acre Amber Cove, forecasts hosting 100,000 passengers in its first year.
There remains considerable potential for the Dominican maritime industry to exploit. Tony Vásquez, President The Dominican Association of Air and Maritime Shipping Agents (ADACAM) explained how: “The Dominican Republic can become a hub for larger ships, which could offload cargo and passengers to then be transported throughout the region on smaller vessels. Our country is ready to meet this need and to become a regional center in that sense, mainly because we have a strong tourism sector.”
The massive port of Caucedo handles 85% of exports that fall under the free trade regime with the US. Completion of Phase II of the facility in 2011 lifted port capacity to 1,250,000 TEU, while an extra 300m of deepwater berthing was introduced. Run as part of the DP World group, it is both port and free zone, located just 25km from the capital. It hosts key enterprises such as China Shipping Hapag Lloyd, Evergreen, NYK, Yang Ming, and Hanjin. As it moves into its second decade of operations, this private enterprise is ever expanding to facilitate the heavy trade between the US and the Central American and Caribbean parties to the CAFTA-DR Free Trade Agreement. Official US figures put US exports to these markets in 2013 at $29.5 billion, making it the third largest trading partner of the US in Latin America. Similarly, goods produced in Dominican FTZs are overwhelmingly exported to Puerto Rico and the US. Caucedo could increase in importance with the completion of a third set of locks in the Panama Canal, which will ultimately increase traffic through the waterway by allowing ‘post-Panamax’ size vessels through. Ewald Th. Heinsen B., President of E.T. Heinsen and Shipping Association of the Dominican Republic (ANRD), told TBY that: “the Caucedo Port [was] investing at least $200 million over the next four years [which ] will bring it to a capacity able to manage large vessels over 350 feet in length.”
The potential for logistics firms is clear, and this expansion of the world-famous canal will certainly increase cargo passing through the country. However, executives involved in the logistics sector understand that more needs to be done. Indeed, both ANRD and the Dominican Association of Air and Maritime Shipping Agents (ADACAM) have undertaken preparatory work for the formation of a transportation logistics cluster. According to Ewald Th. Heinsen B.: “The National Association of Consolidators and Freight Forwarders is interested, as is the government, and of course, ourselves,” continuing that, “Now it is a question of going forward and we hope that for 2015 it should be up and running, hopefully in the first half of the year.” Tony Vásquez depicted the status quo in figures: “The logistics sector accounts for up to 20% of the GDP of countries such as the UAE (Dubai) or Singapore. Here it accounts for about 10%, but we foresee improvement leading to growth, which would in turn generate more employment and account for a larger slice of GDP. However, this can only happen if we improve our competitiveness.”
COME FLY WITH ME
The country boasts 36 airports, eight of which serve international destinations. Six of these are managed under a Build-Operate-Transfer (BOT) model by Aeropuertos Dominicanos Siglo XXI (AERODOM), which is working to profitably modernize and improve the network. The government target for 2022 is to receive 10 million arrivals. Meanwhile, a total of 5,163,682 passengers arrived through the Dominican Republic’s efficient airports in 2013, Punta Cana International Airport, serving a distinguished tourist location in the east of the country, received over 66% of the 2.6 million arrivals by air in 1H2014.
ON THE ROAD
Since the completion of the first highway in the Dominican Republic, “la Duarte,” in 1922, the importance of roads for the economic development of the nation has grown. Decisions on where to lay down roads were logically based on the economic significance of the various regions of the country, with Duarte connecting Santo Domingo and Cibao, the richest part of the interior. The road system that developed from then on became a core driver of economic growth, and remains an essential component of the national transport matrix. DR-1 to 5 are the principal highways in the state. As part of the Ministry of Economy, Planning, and Development’s 2030 National Development Strategy, several road projects are being actively expanded. These include the Cibao-Sur highway, the Vial del Este circuit (Romana, Boulevard del Este, Bávaro-Uvero Alto-Miches-Sabana de la Mar ringroad), and the Avenida La Américas entrance section. Maintenance of smaller roads across 27 provinces in the country has been contracted to local firms with a view to improving infrastructure in rural areas.