The Central Bank of the Dominican Republic (BCRD) reports that between the months of January and March 2022, the remittances received reached a figure of US$2,396.2 million. Likewise, it highlights that this amount exceeds by US$653.0 million the remittances received in the first three months of 2019, the period prior to the start of the COVID-19 pandemic, and in which in USA The aid schemes that were implemented after March 2020 and ended in September 2021 were not yet available.
In the month of March 2022, in particular, remittances totaled US$888.1 million, higher than the months of January and February, and 10.7% less than the same month in 2021. However, these figures reaffirm the establishment of a new level of monthly remittance flows. In that sense, if this amount for March 2022 is compared with the value averaged in the same month for the period prior to the 2015-2019 pandemic, which was US$545.4 million, a significant increase is observed.
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The central bank explains that the conditions of the labor market in the United States (USA) is one of the main factors that continues to influence the behavior of remittances, since 85.6% of the flows in March came from that country. During said month, the unemployment rate decreased slightly to 3.6%, from 3.8% in February 2022. Particularly, the unemployment of Hispanics in the US decreased from 4.4% in February to 4.2% in March.
The BCRD also highlights the reception of remittances from other countries, such as Spainin the order of 5.9%, a country that is home to more than 186,000 Dominicans from the diaspora in Europe, according to a study by the Institute of Dominicans Abroad (INDEX), as well as Haiti and Italy with 1.2% and 0.8% of the flows received, respectively. The rest of the reception of remittances is divided among countries such as Switzerland, Canada and Panama, among others.
Source: BCRD
Regarding the distribution of remittances received by provincesthe BCRD points out that the The National District obtained the highest proportion, 33.4%, followed by the provinces of Santiago and Santo Domingo, with 14.3% and 8.7%, respectively. This indicates that more than half (56.4%) of remittances are received in the metropolitan areas of the country.
Analyzing the March 2022 flows According to the gender of the person who receives, men captured 53.8% and women 46.2% of the remittances received through formal channels.
The BCRD confirms that the evolution of the external sector for this year will be characterized by the dynamism of remittances, exports, foreign direct investment and the recovery of tourism, which is expected to reach pre-pandemic levels. These events will contribute to a greater flow of foreign currency to the country and will help maintain the relative stability of the exchange rate that is currently observed, in such a way that the exchange rate showed an appreciation of 4.3% year-on-year at the end of March 2022. Together with the country’s strong macroeconomic fundamentals, all this indicates that the Dominican Republic has favorable conditions to accommodate adverse shocks in the international environment.
The institution highlights that this greater flow of foreign exchange It has allowed the accumulation of international reserves, which by the end of March 2022 were placed around US$14.6 billion, representing 13.6% of GDP and equivalent to 7.1 months of imports. These metrics exceed the levels recommended by the IMF, helping the Dominican Republic maintain a favorable external position, with a projected current account deficit of around 3.0% of GDP by the end of 2022.
The Central Bank reiterates that it remains alert to continue taking the necessary measures to counteract the impact on the economy Dominican Republic from the prevailing challenging international environment, in order to guarantee the stability of prices and the foreign exchange market.
