Representatives of the construction sector expect to receive financing from the resources released by the Central Bank of the Dominican Republic (BCRD) at rates of 10%, after ensuring that this would improve the expectations of that activity in 2025, which has been financed at rates between 15% and 18%.
It was on November 28, 2024 when the governor of the BCRD, Héctor Valdez Albizu, reported that the Monetary Board (JM) authorized that institution to release some RD$35,000 million, equivalent to 1.75% of the legal reserve requirement.
The presidents of the Dominican Confederation of Micro, Small and Medium Construction Companies (Copymecon), Eliseo Cristopher; Association of Professional Women Micro, Small and Medium Entrepreneurs in the Construction Sector (Mupymecon), Erminda Decena Fulcar, Association of Builders of Santo Domingo Este (Acosde), Riubell Montes De Oca and Joselin A. Rodríguez Severino, vice president of Interinstitutional Relations Mupymecon, stated that the high interest rates that were recorded in the recently completed year 2024 affected potential home buyers, which also negatively impacted the builders.
They defined 2024 as the year of greatest obstacles for the construction sector, despite the fact that the BCRD maintained its inflation target range below, which was 3.35%, according to the recent report presented by that institution.
They recalled that when the BCRD has resources from the legal reserve, the interest rate to place in the bank must be 8%, which favors the segment of the population that can access low-cost housing, contrary to when they are between 15% and 18%.
That is why they welcomed the latest measures of the Monetary Board to reduce the monetary policy rate, but considered that the entities of the financial system have not been receptive despite the BCRD’s efforts to lower the cost of money.
For this reason, they trusted that by 2025 there will be a reduction in interest rates to 10%, which, together with the control of inflation and the availability of reserve resources, will allow dynamism in the construction sector. especially in the low-cost housing segment.
They emphasized that they hope that the disposition of the monetary authorities to be able to access resources is fulfilled and that the measure does not only favor one group.
According to the latest Monthly Indicator of Economic Activity (IMAE), the construction sector registered an average accumulated variation of 3.2% in January-November 2024.
