The sector went from registering variations in its real added value of -4.7% in the first quarter of the year and -0.4% in the second quarter to a year-on-year increase of 5.5% in July-September 2023, the document reveals.
SANTO DOMINGO. – A forum of articles written by technicians from the Central Bank of the Dominican Republic (BCRD), released yesterday, points to the construction sector as one of the most dynamic in recent months, expanding by 9.5% in September, compared to the same month of the previous year.
In the document, the Department of National Accounts and Economic Statistics of the BCRD highlights some points about the preliminary results of the real sector of the economy and the labor market during 2023.
When analyzing the composition of the variation of the gross domestic product (GDP) by activity, it is observed that construction, a sector with a large multiplier effect on the rest of the economy and which has received resources from monetary facilities in September for 12,300 million pesos and approximately 11,000 million in October due to the new measures mentioned, had a good performance in the third quarter of this year.
The sector went from registering variations in its real added value of -4.7% in the first quarter of this year and -0.4% in the second quarter to a year-on-year increase of 5.5% in July-September, the official document points out.
The analysis details that the hotels, bars, and restaurants segment saw a 10.9% increase in its added value through the first nine months of this year. In this regard, the arrival of non-resident passengers and cruise ship passengers reached 7,630,933 visitors, with a hotel occupancy rate of 75% during the January-September period.
The report also noted that foreign direct investment reached $3,369.5 million in January-September, representing a year-on-year increase of 3.9%. "This flow of resources, mostly destined for energy, tourism, and trade, demonstrates once again the strong confidence of foreign investors in the country," the team of experts stated.
They project that by the end of 2023, foreign direct investment is expected to exceed $4.3 billion, which, together with the $10 billion expected to come in from remittances, would both contribute to the increase in domestic demand, that is, to consumption and investment.
October broadcast
The Central Bank of the Dominican Republic (BCRD) highlights that financial entities channeled almost half of the RD$40 billion authorized by the Monetary Board as a new rapid liquidity facility in three days, on October 23, for the construction, manufacturing, export and agricultural sectors.
The document states that, as of October 26, the financial system had already channeled some 18,614 million pesos of these resources, the agency indicated in a document titled "Open Page, opinion article forum of the technicians of the Central Bank of the Dominican Republic.".
He explained that the new facility complemented the series of stimuli that the monetary authority has applied to the economy for its reactivation, impacting its growth after a series of negative effects due mainly to international circumstances.
Regarding monetary measures, the report states: "These measures have included a reduction of the Monetary Policy Rate (MPR) by 100 basis points to 7.50% annually and the provision of liquidity through the release of legal reserves and the Rapid Liquidity Facility, which have made it possible to channel 126 billion pesos in loans to productive sectors and households through financial intermediaries, mostly at interest rates no higher than 9% annually.".
"Given the new context of more favorable monetary and financial conditions and with greater execution and efficiency in capital spending by the government, the Dominican economy has begun a recovery process," he says.
In that regard, the preliminary figures of the Monthly Indicator of Economic Activity (IMAE) recorded a year-on-year expansion of 3.1% in September and 2.6% in July-September of this year, when compared with the same period of the previous year, standing out as the highest rates of the current year.
- The cumulative variation was recorded at 1.7% in the period January-September of this 2023.
It notes that: "The above indicates that the monetary policy transmission mechanism, which operates with lags that can extend to more than a year, is working and it is expected that economic activity will continue to pick up until it returns to its potential growth rate, which is expected to occur in the next year 2024.
