SANTO DOMINGO - According to preliminary results of economic activity for August of this year, released yesterday by the Central Bank of the Dominican Republic, the construction sector shows a positive year-on-year variation, ranking as the fourth sector to register growth during the past month.
The agency's figures show a 6.9% year-on-year change in the aforementioned month, which is reflected in the increase in sales volumes of the main inputs used in that sector, the agency's report states.
“It should be noted that, in the specific case of the 5.6% expansion of the IMAE in August, all activities registered positive year-on-year rates. The following stand out as showing the greatest growth: financial intermediation (8.7%), mining (8.5%), free zone manufacturing (8.1%), construction (6.9%), local manufacturing (6.8%), commerce (6.2%), and transportation (6.0%),” the document explains.
The Central Bank of the Dominican Republic (BCRD) highlights that the monthly indicator of economic activity (IMAE) registered an expansion of 5.6% during the month of August of this year, thus accumulating an average year-on-year growth of 5.1% in January-August 2024.
“This behavior has occurred within a context of price stability, where inflation has remained at the lower end of the target range of 4.0% ± 1.0% this year as a result of the implemented monetary and fiscal policies. This has allowed for the timely mitigation of risk factors for the performance of the Dominican economy. The
report notes that the 5.1% year-on-year variation in January-August 2024 is due to the performance of activities such as construction (4.9%) and free zone manufacturing (6.6%), highlighting that exports under this regime totaled US$5,691.4 million during the period. Likewise, services activities as a whole showed a cumulative increase of 5.4% compared to the same period of the previous year, among which hotels, bars, and restaurants (7.1%), transportation and storage (5.9%), real estate and rental activities (5.8%), and communications (5.3%) stand out.
In this regard, it is important to emphasize that the observed trajectory "The economic activity shows the resilience of the national production system in the face of the current global context, in which the expectations of economic agents have been affected by the uncertainty associated with geopolitical conflicts in the Middle East and Eastern Europe, which has been reflected in greater volatility in commodity prices," the report points out.
Regarding financial intermediation activity, it showed a year-on-year increase in its real added value of 8.1% in January-August, this result being influenced by the 15.2% expansion of credit granted to the private sector in national currency, equivalent to an additional RD$232,425.2 million compared to August of the year.
The report points out that the added value of the hotel, bar and restaurant activity experienced a year-on-year variation of 0.9% in August, largely explained by the moderation of the growth rate (1.5%) in the arrival of non-resident passengers by air in the aforementioned month, due to the statistical effect of the base of comparison after having registered a record in the arrival of non-resident foreigners in August 2023.
“In cumulative terms, the sector's added value grew 7.1% in January-August 2024, supported by the total number of passengers received in the country by the various airport terminals, which reached 5,961,484 tourists.”.
The one with the largest year-on-year increase
The expansion of the IMAE in January-August places the Dominican Republic as the economy with the highest year-on-year increase compared to its Latin American peers, according to the latest information available to date published by the countries, emphasizes the Central Bank.
It states that this result is in line with the forecasts of different international organizations, whose projections point to an expansion around the potential and place the country as a leader in terms of growth of economic activity in the region by the end of 2024.
The Dominican economy is well positioned to maintain a growth rate around its potential, taking into account the strength of its macroeconomic fundamentals, the resilience of the productive sectors, and the improvement in country risk indicators in international markets.
