In April, the recorded growth reached 14.9%
SANTO DOMINGO- According to the preliminary report published in April by the Central Bank of the Dominican Republic (BCRD), the Dominican construction sector experienced an average growth of 6.4% during the January-April period of this year.
These figures, released last week by the governing body as part of the preliminary results of economic activity up to April 2024, place the block and rod sector as the third fastest growing sector during that period, preceded by hotels, bars and restaurants and financial services.
Likewise, real estate activities maintain a good performance within the main areas that drive the Dominican economy, according to data from the Central Bank, managing to place itself alongside construction with 6.1%.
“The year-on-year variation for January-April 2024 reflects the strong performance of the productive sector in an environment of price stability. In this regard, the hotel, bar, and restaurant sector stands out with an average growth of 9.5% in the first four months of the year, followed by financial services (7.1%), construction (6.4%), real estate activities (6.1%), free trade zones (6.0%), energy and water (5.2%), agriculture (3.9%), commerce (3.1%), and local manufacturing (2.8%), among others,” the Central Bank of the Dominican Republic (BCRD) monthly report noted.
First quarter
In January, construction was the second fastest-growing sector of the economy (6.4%), and in February it also ranked as the second area with the highest positive economic variation at 9.7%, preceded only by hotels, bars and restaurants, which reached 12.8%.
For the first quarter of 2024, the average cumulative growth was 3.8%, while in April it registered a growth of 14.9%
Impulse
In its report, the Central Bank highlighted that the recent performance of the Dominican economy is largely due to the positive impact of the liquidity expansion program implemented by the Central Bank since May 2023, "which has fostered favorable monetary and financial conditions, as the monetary policy transmission mechanism operates.".
“This monetary stimulus plan implemented by the institution that governs monetary policy has allowed the channeling of loans through financial intermediaries for some RD$196 billion to productive sectors, micro, small and medium-sized enterprises (MSMEs) and households at interest rates no higher than 9% per year.”.
Indeed, these measures—the agency emphasized—have boosted private credit in local currency, expanding by approximately 21.3% year-on-year in April 2024, equivalent to an additional RD$298,561.1 million. Furthermore
, the economy's performance is consistent with the pace of capital expenditure by the government. It is also important to highlight that the recovery trend observed in economic activity aligns with the forecasts of various international organizations, which position the Dominican Republic as one of the fastest-growing economies in the region for 2024. In fact, the latest projections from the International Monetary Fund (IMF) place the country's growth for this year at 5.4%, those from the World Bank at 5.1%, and those from the Economic Commission for Latin America and the Caribbean (ECLAC) at 4.5%.
“Finally, the results presented bode well for the Dominican economy in 2024, with a projected growth rate of 5%, around the potential rate, one of the highest in Latin America, in a context where domestic inflation would remain within the target range established in the Monetary Program of 4% ± 1%. Indeed, year-on-year inflation is currently at 3.03%, around the lower limit of the aforementioned range, and core inflation is at 3.99%, the latter right in the center of the target range,” the Central Bank stated.
