Dominican Republic Upgraded by Fitch as Gold Sales, Tourism GainEzra Fieser
The Dominican Republic’s credit rating was raised by Fitch Ratings, which citied an increase in gold exports, growth in tourism and a shrinking current account deficit in the Caribbean’s biggest economy.
Fitch boosted the Dominican Republic’s long-term debt rating one step to B+, four levels below investment grade, putting the $61 billion economy in the same category as Kenya and Mongolia. Gross domestic product will expand by 6.2 percent this year and 5 percent per year through 2016, Fitch said, making it one of the fastest-growing economies in Latin America.
“The Dominican Republic has demonstrated economic resilience in the past and, now, because of the diversified export structure, growth prospects will be robust,” Cesar Arias, an associate director at Fitch, said in a phone interview.
A rebound in the U.S., the country’s biggest source of remittances and foreign direct investment, coupled with exports from the Pueblo Viejo gold mine operated by Canada’s Barrick Gold Corp. and Goldcorp Inc., will help narrow the current account deficit to 3.3 percent of GDP by 2016, less than half the rate in 2012, Fitch said.
Tourism to the Dominican Republic, which shares the island of Hispaniola with Haiti, rose 14 percent in October from a year earlier.
The rating increase comes after the Dominican senate this month approved the sale of about $2.5 billion in local and global bonds next year.