DOMINICAN REPUBLIC - Economy
Minister of Economy, Dominican Republic
Juan Temístocles Montás is a university professor, renowned politician, and author of various books on the electricity sector, politics, and economy in the Dominican Republic. He has completed a number of post-graduate programs in the Dominican Republic and Spain, and has distinguished himself in international conferences with the World Bank, the IMF, and the British Chamber of Commerce, among others. He has held various important positions related to the Dominican economy, and currently serves as Minister of Economy, Planning and Development.
The macroeconomic framework developed by the Ministry of Economy, Planning and Development serves as the economic policy guideline for the short and medium term, and forecasts growth for the 2015-2018 period at around the potential economic growth of the country, namely 5%. This potential growth considers the projected demographic trends of the country, as well as investment growth and productivity similar to that presented over the past decade.
One sector of remarkable growth is mining, which grew by 20% in 1H2014 as compared to 2013. Growth in this sector is mostly a result of the commencement of operations of mining company Barrick Gold. Additionally, this administration has emphasized developing MSMEs, for which were allocated resources and efforts and to formalize and develop the companies of this nature. The government developed a comprehensive plan that covers the promotion of formalization, market access for MSMEs, financial development, business development, and the promotion of entrepreneurship. On the other hand, we have made progress in the agricultural sector because of a series of actions and policies implemented and promoted by the State, through the Special Fund for Agricultural Development (FEDA), with the aim of boosting agricultural production, encouraging and expanding exports of agricultural goods, and increasing food security for the population. Within these measures we can highlight the support for land preparation services and technical assistance to producers, in addition to financial support through increased financing tools and channels, something that is reflected by the disbursements of the Agricultural Bank, which grew by 6.5% in September 2014.
In general, two years after the promulgation of the Law on National Development Strategy 2030, we have achieved at least one measure of policy in almost 45% of all proposed lines of action. During the first year, we put great emphasis on preparing regulations to implement the strategy and interagency coordination. Following this, we proceeded to meet the proposed lines of action for which policy measures were adopted to achieve the following objectives. These featured participatory democracy and responsible citizenship, the rule of law, and public safety, health, and universal social security, macroeconomic drivers, competitiveness and innovation, a sector and territory-integrated production structure, and adequate adaptation to climatic change. In general, one of the main challenges facing the National Development Strategy was the continuity of efforts, without pause, to implement policy to achieve the outlined objectives.
Much of the government’s strategy to stimulate FDI has been supported in the process of comprehensively institutionalizing the country, and having the required institutions in operation to create a favorable business climate for FDI. Some of the initiatives and goals of the administration are to realize the outlined fiscal consolidation process in pursuit of a substantial reduction in the primary deficit, the implementation of prudent and stable macroeconomic policies that prevent abrupt fluctuations, greater transparency of government operations, a state law reaffirming legal certainty, and pro-competition legislation.
The advantage of having such FTAs is duty free access to the largest consumer markets with greater purchasing power. Furthermore, these facilities place us on equal terms with Central American countries, with which we would otherwise be at a disadvantage. Furthermore, these treaties provide an environment of greater legal certainty, which is an incentive for investment. Looking ahead, treaties can be beneficial to the extent that domestic producers improve their ability to compete by offering products meeting higher-quality standards demanded by these countries, which would increase exports and employment. In the agricultural sector, for example, there is still room to reap the benefits of these treaties.
© The Business Year – January 2015
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