Caribbean's Fastest Economy Sees 6% Growth in 2016 on Tourism

  • Dominican Republic president in annual address before election
  • Island nation is far outpacing sluggish Latin American growth

The Dominican Republic’s economy is likely to expand by about 6 percent this year as construction and tourism continue to buoy one of the fastest-growing countries in the region, President Danilo Medina said in his annual address to Congress Saturday.

Medina, who’s up for re-election, said the country’s $64 billion economy will again outpace that of Latin America, which the International Monetary Fund projects will see a contraction of 0.3 percent this year. The Caribbean country grew 7 percent in 2015, according to its central bank.

“While other countries in the region are shaken by political tensions, clashes between the government and the private sector, or struggles between social classes, our reality is very different,” Medina said in remarks to mark the nation’s independence day.

The country of 10.5 million people, which shares the island of Hispaniola with Haiti, has relied on foreign investments and tourism to grow. In 2013 it set a goal of doubling the number of tourist visits to 10 million within a decade. Already the most-visited destination in the Caribbean, the Dominican Republic will see about $6.5 billion in earnings from its tourism sector this year, Medina said.

Lower oil prices, meanwhile, will help keep inflation within the central bank’s target zone -- within one percentage point of 4 percent -- while the government stands to save around $800 million on petroleum imports, he said.

The Dominican Republic’s Congress in 2015 revised the constitution to allow Medina, 64, to run for a second consecutive four-year term. He will face economist and former vice presidential candidate Luis Abinader, 48, in the May 15 general election.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE