It has accumulated 8.3% in the first two months of the year.
SANTO DOMINGO.- The construction sector continues to accumulate positive figures and is returning to growth during 2024, placing itself in February as the second area of greatest economic variation with 9.7%, preceded only by hotels, bars and restaurants, which reached 12.8% during the past month.
Data from the Central Bank of the Dominican Republic highlights that construction showed a year-on-year variation of 9.7% in February and an accumulated average of 8.3% in the first two months of 2024, reflecting the effectiveness of the liquidity provision measures implemented by the monetary authorities, according to the agency.
The statement establishes that the activity of hotels, bars and restaurants had a variation of 12.8%, construction (9.7%), manufacturing of free zones (9.4%), commerce (8.5%), energy and water (8.1%), local manufacturing (6.9%), among others.
It highlights that the construction sector has a significant multiplier effect and pull on other economic sectors, and that in this regard, the Central Bank has placed more than RD$190 billion through financial intermediaries at rates no higher than 9.0% per year, to facilitate loans to productive sectors and households.
Economy grows
Similarly, the BCRD report indicates that the monthly indicator of economic activity (IMAE) registered an expansion of 6.2% during the month of February of this year, higher than the 4.6% observed in January, thus accumulating an average year-on-year growth of 5.4% in the first two months of 2024, continuing with the upward trend that the economy has been exhibiting in recent months.
According to preliminary results of economic activity as of February 2024, this recent performance of the Dominican economy is consistent with the favorable operation of the monetary policy transmission mechanism and with the highest level of public capital spending recorded since mid-2023, where a year-on-year increase in real quarterly gross domestic product (GDP) of 2.6% was observed in July-September and 4.2% in October-December, resulting in a cumulative growth of 2.4% for the aforementioned year 2023, above the Latin American average.
The organization highlights that this recovery trend is in line with the projections of various international organizations and risk rating agencies, which place the Dominican Republic as one of the fastest growing economies in the region for the current year 2024.
In other news, local manufacturing registered year-on-year growth of 6.9% in February, accumulating a 4.5% increase for the January-February 2024 period. This result is primarily driven by the strong performance of the basic metals manufacturing and food industries. Similarly, free trade zone manufacturing exported US$677.7 million in February, accumulating US$1,217.5 million during the first two months of the year, boosting the sector's value-added growth by 9.4% in February and 5.4% for January-February.
Regarding the hotel, bar, and restaurant sector, it showed a year-on-year increase of 12.8% in February of this year, accumulating a 10.6% expansion in January-February 2024. This remarkable performance was largely driven by air passenger arrivals, which reached 1,498,061 tourists, which, together with the 602,985 cruise ship passengers, totals 2,101,046 visitors during that period. Furthermore, the consolidated loan portfolio for the sector increased by 12.5% compared to February 2023.
Regarding financial intermediation activity, it showed a year-on-year variation in its real added value of 6.3% in February and 5.9% January-February, this result being influenced by the year-on-year expansion of 21.4% of credit granted to the private sector in national currency, equivalent to an additional RD$293,488.5 million compared to February of the previous year.
Agricultural activity registered a year-on-year growth of 4.0% in January-February of this year, with increases in the production of rice, plantains, chicken, eggs, among others, in which the technical and financial support to agricultural producers at the national level provided by the Government through the Ministry of Agriculture has had an important impact.
Finally, most economic activities registered positive performance in the first two months of 2024, with the exception of mining, whose 15.9% decline is largely explained by the cessation of operations of the ferronickel extraction company since December 2023. The slowdown in gold and silver extraction, due to the plan to upgrade the facilities required for the continuation of mining activity at the country's main deposit, has also impacted the sector's performance. The Central Bank report states that this process is expected to normalize in the coming months of this year, with production levels returning to normal.
