The Minister of Economy, Planning and Development, Pável Isa Contreras, indicated that projections for 2023 point to it being a positive year in terms of macroeconomics, in which it is forecast that the country will experience an inflation rate within normal parameters and a growth in gross domestic product (GDP) of 4.5%, which “is still quite respectable although it is below the historical level of the Dominican economy”.
“I believe that 2023 will be a year in which the level of economic activity will be good, which will help with the growth of business opportunities for people and for employment, and it will also be a year of lower inflation, which is a relief compared to 2022”, he said.
A statement points out that the official added that estimates for 2022 show that it will close with a growth of around 5% of GDP, which would be “a very robust growth in the regional and global context”, while the inflation rate would be slightly above 7%.
“If you have GDP growth of 4.5% to 5.5%, it is most likely that the unemployment rate will remain stable or decrease”, he said.
He maintained that the growth in 2023 will probably be lower than that of last year, “and it is difficult for it to be otherwise because, on the one hand, local financial conditions are tightening more because monetary policy has tightened more to contain inflation and, on the other hand, international conditions are also more restrictive”.
Isa Contreras reminded that the Dominican Republic is a small economy, which sells much of what it produces abroad and buys much of what it consumes abroad, like any other small economy, whether poor or rich.
“If you sell a lot of what you produce abroad, your economic activity partly depends on how the international scenario behaves and if the latter experiences a decline, then the growth of your sales abroad will be lower and therefore your production will be lower”, he explained.
The minister pointed out that, in order to sustain economic growth, the government has taken measures such as maintaining the growth rate of public investment in the construction sector during the first half of the year.
Isa Contreras reiterated that the well-being of people is partially dependent on economic issues such as GDP growth, the generation of quality jobs and the maintenance of relatively low prices in the basket of consumption.
He also highlighted the role that public services play in the quality of life of people, for which the Ministry of Economy seeks to create synergies between the different institutions to improve the coverage and quality of public services.
Finances
The minister affirmed that the Dominican Republic’s external debt has been manageable for years, but it still represents a problem for the country’s finances.
“We need the weight of the debt to be lower and for that we need more resources, to collect more because what we collect is very low”, he said.
However, Isa Contreras indicated that the government has no plans to propose tax system reforms during this term, therefore, he added, the government is forced to improve the quality of public spending to provide higher quality services.
