Receiving with gratitude is to honor what has been received. And, in this case, the highest tribute that the Dominican Republic can pay is to take advantage of the norms of origin that open the door to an invaluable competitive advantage for our exports to the US market.
Many companies had already benefited from this agile and reliable mechanism. Today, when our products face a more severe tariff environment, the rigorous and precise application of these provisions is not only convenient, but essential.
The principle is diaphanous: every Dominican company that exports to the United States or Canada must comply with the rules of origin of DR-CAFTA so that its product is recognized as “regional” and can access, thus, a preferential tariff treatment. When the exporter uses supplies from the United States – our business partner – these are considered regional content, so that their value can be deduced from the payment of tariffs.
Aware of the transcendence that exporting companies make the proper proceedings, institutions such as the Ministry of Industry, Commerce and MSMEs and the National Free Zones Council constantly urged to take this benefit fully.
If thus, the commercial position of the country – already advantageous, because we enjoy a minimum 10 % rate against other nations that face much higher levies – could be more robust even more, thanks to the high proportion of inputs and raw materials that nourish our exports. In fact, we are one of the economies whose external sales have a greater component of imports from the United States.
Not all exports, however, will obtain the same level of benefit: the magnitude will depend on the type of product and its degree of linking with US suppliers, which determines which part of its exported value corresponds to supplies of that origin. In the case of free zones – Locomotive truths of our exports to the United States – the imported component is usually high, since much of its production is based on assemblies and light transformations of foreign inputs.
You can read: Exports reached US $ 1,374.5 million
The figures are eloquent: in the current tariff scenario, the discount derived from the purchases of American supplies and raw materials can represent for our exporters a real treasure, more than a simple concession. CNZFE and OEI studies estimate that the local added value ranges between 25 % and 40 % of the exported value, which implies that the imported component reaches between 60 % and 75 % in many productive lines.
Although not all those inputs come from the United States, the majority does. Hence, it can be inferred that the effective tariff facing our exports could be reduced by three, four or even five percentage points, without representing any loss for the US economy. On the contrary: the granted is transformed into a link, a loop that is strengthened over time.
Wisdom reminds us that “the fruit that legitimately belongs to us should not be allowed to dry in the branch by carelessness”, even less when the earth has become, in part, arid to sow.
