He highlighted the existing perception in the productive sectors of macroeconomic stability and social peace that the Dominican Republic exhibits.
The International Monetary Fund (IMF) mission estimates that the Dominican Republic would be exhibiting a growth of 5.1% of its gross domestic product for this year 2024, with inflation within the Central Bank’s target range.
The head of the mission, Emilio Fernandez-Corugedo He also praised “the stimulus that the growing figures of foreign direct investment represent for the country, a symbol of the strength of the external sector in the Dominican Republic.”
He highlighted the perception of macroeconomic stability and social peace in the productive sectors in the Dominican Republic.
In this regard, he highlighted the positive assessment that the private sector has of the Central Bank’s achievement of having reached the inflation target within the target range of 4% +/-1%, while also maintaining the stability of the financial system.
Regarding the financial sector, the IMF believes that it remains at adequate levels of capitalization and profitability, and “positive prospects for the future of the Dominican financial sector remain.”
Fernando-Corugedo is in the country leading the mission of Article IV of the IMF’s Articles of Agreement and offered these details after a meeting with the governor of the Central Bank of the Dominican Republic (BCRD), Héctor Valdez Albizu.
The meeting presented the first conclusions of the meetings that the organization held in the country over the past two weeks with entities and institutions of the public sector, private sector, financial system and civil society.
Fernando Corugedo He thanked the Central Bank for its collaboration in carrying out its assessments, highlighting its willingness, professionalism and transparency, always within the best international standards. He added, “our absolute willingness to provide them with technical assistance in whatever they need in future projects.”
For his part, Valdez Albizu expressed the satisfaction that the BCRD feels at the high level of cooperation between the two organizations, and whose macroeconomic assessment by the IMF staff largely coincides with the projections and macroeconomic perspectives of the Central Bank itself.
Regarding the performance of the financial system, Valdez Albizu recalled that “its solvency ratio was 17.60% as of March 2024, higher than the 10% required by regulations. Likewise, the delinquency rate of the financial system’s credit portfolio was only 1.3% and that of multiple banks was 1.2% in June 2024; while the return on equity (ROE) was 24.9% and the return on assets (ROA) reached 3.0%.
The governor indicated that activities that generate foreign currency “continue to show favorable performance, with tourism, exports from free trade zones, remittances and foreign direct investment standing out.
In this context, the exchange rate has remained relatively stable, while international reserves are around US$15.6 billion as of July 22, equivalent to 12.6% of the gross domestic product (GDP) and about 5.9 months of imports, exceeding the metrics recommended by the IMF.
Finally, he stated that “the Dominican economy is in a good position to achieve growth in line with its potential, to face the challenging panorama, taking into account the strength of its macroeconomic fundamentals, the resilience of the productive sectors and the improvement in the country risk indicators in international markets.”
The IMF mission has been holding meetings with the Government’s economic team and with representatives of the Dominican business sector for about two weeks, which allows it to analyze the data and prepare a report on the country.
