The Dominican Republic is poised to consolidate its position as the world’s leading exporter of premium cigarettes (cigars) in the face of the possibility that the United States will impose a 100% tariff on exports of tobacco Nicaragua and evaluate withdrawing that country from the Free Trade Agreement between Central America, the Dominican Republic and the United States (DR-Cafta).
The United States Government announced that it is analyzing trade sanctions against Nicaragua, after determining that its Government’s policies regarding human rights, labor and the rule of law are “unreasonable” and hinder American trade.
According to the Office of the Trade Representative (USTR), the measures being evaluated include the immediate or gradual application of duty of up to 100% on Nicaraguan products and the suspension of tariff benefits from the DR-Cafta.
Nicaragua in the crosshairs of the US market
During the year 2024, Nicaraguan tobacco exports They amounted to 421.8 million dollars, a growth of 2% compared to the previous year. Of that total, the United States absorbed 80.2%, followed by Honduras (3.8%) and the Dominican Republic (3.2%). These three markets represented 87.2% of Nicaraguan exports, according to official data.
The tobacco business in Nicaragua —centered in Estelí, Jalapa and Nueva Segovia— has been fueled by fertile volcanic soils and a manufacturing industry renowned for the quality of its cigars. However, its high dependence on the US market leaves the country vulnerable to a change in Washington’s trade policy.
Window of opportunity for the Dominican Republic
In contrast, the Dominican Republic has a solid industrydiversified and with current trade agreements that guarantee legal stability. The Institute of Tobacco of the Dominican Republic (Intabaco) projects that the 2025-2026 tobacco harvest will reach more than 400 thousand quintals, cultivated in 160 thousand tasks distributed in 29 tobacco-growing areas in 15 provinces.
The Minister of Industry and Commerce, Víctor Bisonó, highlighted, at the beginning of the 2025-2026 tobacco harvest in Santiago, that the production and export of dominican tobacco has grown more than 25% since 2019, going from 278 thousand quintals to more than 330 thousand per year, which raised exports from 934 million dollars in 2019 to more than 1,340 million dollars today.
The director of IntabacoIván Hernández Guzmán, highlighted that the country produces more than 131 million premium cigars and 8,000 million mechanized cigarettes per year, exported to more than 140 countries.
“We are a leader in tobacco export premium in the world and we have a strong and resilient industry, it has been thanks to those men and women who get up every day to contribute to its development with their minds, hands and hearts, for which I congratulate them,” said the official.
Trade of tobacco DR and Nicaragua
During the year 2025, The Dominican Republic has imported unstemmed tobacco from Nicaragua worth 13.0 million dollars, and 7.2 million dollars in tobacco totally or partially deveined, but without any other type of processing.
Likewise, imports worth 2.5 million dollars were recorded in cigarsincluding blunt ones, and cigarettes or cigarillos containing tobaccoas well as 0.3 million dollars in tobacco for smoking, including substitutes containing it in any proportion.
In the opposite direction, Dominican exports to Nicaragua amounted to 6.6 million dollars in tobacco undeveined and 5.0 million dollars in tobacco totally or partially deveined, but not otherwise processed.
Production, employment and global leadership
The Dominican tobacco sector It generates more than 110 thousand direct jobs and constitutes one of the main sources of employment in free zones, with more than 38 thousand formal positions. The main producing areas are Santiago, Valverde, Montecristi, Espaillat, San Juan and Azua, while the key manufacturing provinces are Santiago, La Romana and Puerto Plata.
- The Dominican Republic grows five types of tobacco with 21 varieties, including Olor Dominicano, Havanensis, Andullo, Criollo Local and tobaccos grown for wrappers, such as Connecticut and Broadleaf. This diversity allows it to quickly adapt to the preferences of the international market.
A strategic position in the face of regional rearrangement
If Nicaragua loses the benefits of DR-Cafta or new tariffs are applied, the Dominican Republic could absorb part of the US market which represents more than 80% of Nicaraguan exports of tobaccoequivalent to about 338 million dollars.
With its experience, productive capacity, quality and global reputation, the dominican industry has the opportunity to reinforce its leadership and attract new investments in the premium cigar segment, consolidating its role as the heart of the tobacco of the Caribbean.
