Construction registered a year-on-year growth of 6.8% in October, accumulating an average expansion of 4.7% in January-October 2024.
SANTO DOMINGO– The monthly economic activity indicator (IMAE) registered a year-on-year expansion of 5.4% in October, reaching an average growth of 5.1% in January-October 2024 compared to the same period of the previous year, the Central Bank of the Dominican Republic (BCRD) reported yesterday, upon releasing the preliminary results of economic activity through October 2024.
In a statement, the regulatory body indicated that this performance has occurred within a context of price stability, in which year-on-year inflation has remained at the lower end of the target range of 4.0% ± 1.0% this year, registering 3.16% in October.
"This performance has been a result of the economic policies implemented, both in the monetary and fiscal spheres, which have allowed us to successfully overcome the risk factors of the current global context, including the impact of geopolitical conflicts in the Middle East and Eastern Europe on expectations and the price of some commodities," he notes.
It adds that it is relevant to highlight that the economic performance of the United States of America (USA), with an annualized quarter-on-quarter growth of 2.8% in the third quarter of 2024, slightly above its long-term historical average, has had a favorable impact on the Dominican economy, given the multiple interrelationships of the country with its main trading partner through remittances, tourism, net exports and foreign direct investment.
"It should be noted that the expansion of the IMAE in January-October consolidates the Dominican Republic as the economy with the highest year-on-year increase compared to its Latin American peers, in line with the forecasts of the different organizations, which point out that the Dominican economy would be closing in the current year 2024 at 5.1% as is the case of the International Monetary Fund (IMF).".
The Central Bank adds that the 5.1% year-on-year change in the Monthly Index of Economic Activity (IMAE) for January-October 2024 is mainly explained by the performance of the services sector as a whole, which showed a cumulative increase of 5.3% compared to the same period of the previous year. Notable among these sectors were financial intermediation (7.9%), hotels, bars, and restaurants (6.0%), transportation and storage (5.8%), real estate and rental activities (5.7%), and communications (5.2%). Likewise, local manufacturing increased by 7.1% in October of this year, registering a cumulative increase of 4.4% for January-October 2024. Manufacturing in free trade zones grew by an average of 6.5% during the first ten months of the year and by 5.8% in October 2024.
Regarding construction, the report indicates that it registered a year-on-year growth of 6.8% in October, accumulating an average expansion of 4.7% from January to October 2024. This remarkable dynamism reflects the increase in sales volumes of the main inputs used in infrastructure development. Specifically, local cement sales in metric tons grew 11.0% in October 2024, compared to the same month of the previous year.
Regarding financial intermediation activity, it showed a year-on-year increase in its real added value of 8.0% in October, for an accumulated 7.9% in January-October, this result being influenced by the expansion of 12.5% of credit granted to the private sector in national currency, equivalent to an additional RD$198,647.7 million compared to October of the previous year.
It is worth noting that, although mining registered an average year-on-year variation of -5.4% in January-October, this activity showed a positive result during the months of August (8.6%), September (16.9%) and October (1.3%) of 2024, supported by the increase in gold production in the country's main deposit, foreshadowing a favorable performance for the coming months.
Regarding the value added of the hotel, bar, and restaurant sector, this experienced a year-on-year increase of 6.0% from January to October, significantly influenced by passenger arrivals through the various airport terminals during that period. According to projections from the Ministry of Tourism, visitor arrivals by air and sea are expected to reach 11.5 million passengers by the end of 2024.
Finally, the Dominican economy is well positioned to maintain a growth rate around its potential, taking into account the strength of its macroeconomic fundamentals and the resilience of its productive sectors.
