Fastest Growing Economy in Americas Set to Re-Elect Leaderby
Dominican Republic economy grew 7% last year as tourism rose
Constitutional change allowed President Medina to run again
Dominican President Danilo Medina looks set to win a landslide victory in elections Sunday, winning a second, four-year term after overseeing the fastest-growing economy in the Americas last year.
Medina has led opinion polls, with most showing he will win in the first round with more than 50 percent of the vote, the threshold to avoid a run-off. His main opponent, Luis Abinader, an economist and former vice presidential candidate, has seized on corruption scandals in the government and vowed to crack down on crime.
The Caribbean country of 10.5 million, known for its beaches and baseball players, expanded 7 percent last year, led by strong domestic demand as lower oil prices boosted disposable income and a recovery in the U.S. helped tourism and remittance flows. Medina has said he wants to use a second term to boost tax collection and cut debt. He has also pledged to overhaul the electricity sector, building two new generation plants and boosting the use of renewable energy sources.
“It’s pretty clear that he will win and his party will maintain a super majority in congress, which should allow him to push through his agenda, which includes fiscal reform,” said Agata Ciesielska, Latin America researcher for Eurasia Group. “We see this is a positive for the overall fiscal consolidation story.”
The nation’s dollar bonds have returned 29 percent since Medina took office in August 2012, compared to an average of 16 percent for emerging market sovereign bonds. The peso has weakened 27 percent over the same period.
A poll conducted earlier this month of 1,038 potential voters by Expedition Strategies put Medina ahead with 65 percent of the vote. An April Gallup poll commissioned by Hoy newspaper found that 63 percent of voters would back the incumbent.
Medina’s popularity led his party last year to change the constitution to adopt a more U.S.-style system, allowing the president to run for a second consecutive term with an eight-year overall limit. Previously, presidents could serve only one term, but could run again after waiting four years. The change also means that for the first time in more than two decades, voters will pick a congress and local officials. Some 7 million people are registered to vote.
The government also struck a deal last year with Venezuela to pay off, at a steep discount, $4.1 billion owed for years of oil shipments under the regional Petrocaribe energy pact. Medina held it up as an example of how his government has worked to reduce debt.
The country’s beaches helped attract more than 5 million visitors last year. The government has set a goal of bringing in at least 10 million tourists by 2023, almost equivalent to the current population.