Santo Domingo.- The Central Bank of the Dominican Republic (BCRD), committed to transparency and timely disclosure of information, communicates preliminary data on the economic activity performance up to September 2024, with the aim of keeping informed the economic agents and the general public.
The monthly economic activity indicator (IMAE) experienced a 4.7% growth in September of this year, thus achieving an average annual increase of 5.1% in the period from January to September 2024. This result has been achieved in a context of price stability, maintaining inflation within the target of 4.0% ± 1.0%, thanks to the monetary and fiscal policies applied, which have facilitated the mitigation of risks for the Dominican economy.
It is relevant to mention that the evolution of economic activity highlights the adaptability of the national economy in the face of current global uncertainties, marked by geopolitical tensions in the Middle East and Eastern Europe.
Going against the global tide, the United States, the main commercial partner of the nation, recorded a 2.7% annual growth in the third quarter of 2024. Inflation, on the other hand, stood at 2.4% annual in September of this year, evidencing a controlled adjustment towards the target set. In this period, the Federal Reserve opted to cut the reference interest rate by 50 basis points (pbs), with expectations of future reductions during the remainder of 2024. In this environment, the International Monetary Fund (IMF) has improved its growth projection for 2024 to 2.8%, an upward adjustment of 0.2 percentage points.
Additionally, the expansion of the IMAE in the first nine months places the Dominican Republic at the head of Latin America in terms of annual growth, according to the latest information published by the countries of the region. This achievement aligns with the predictions of international organizations and the government’s macroeconomic framework, forecasting a growth close to 5.0% and positioning the country as the leader of regional economic growth by the end of 2024.
The 5.1% annual variation to September 2024 is mainly due to the performance of sectors such as construction (4.4%) and free trade zone manufacturing (6.5%), highlighting that exports under this regime reached US$6,404.1 million in that period. Service activities also showed a cumulative growth of 5.3% compared to the previous year, with notable increases in financial intermediation (7.9%), hotels, bars and restaurants (6.3%), transportation and storage (5.9%), real estate and rental activities (5.7%), and communications (5.1%).
The contribution of financial intermediation to growth was highlighted, with a 7.9% increase in its contribution to the added value from January to September, supported by a 16.2% expansion in local currency credit to the private sector, representing an additional RD$309,554.3 million compared to September of the previous year.
Although mining reduced its average annual growth by -6.1% from January to September, it stood out for its positive performance in August with an 8.5% and in September with a 16.9%, driven by an increase in gold production at the country’s main mine.
The construction sector reflected a 4.4% annual growth until September, evidenced by the higher sales of key inputs for infrastructure projects.
Regarding hotels, bars and restaurants, a 6.3% annual growth was observed until September, significantly driven by the flow of tourists through the airports. It is estimated that a total of 8.5 million visitors will be received by the end of the year.
The Dominican economy is positioned favorably to sustain a growth rate in line with its potential, supported by the solidity of its macroeconomic fundamentals, the strength of its productive sectors, and improvements in country risk indicators in international markets.
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