Posted by: Anni Orekh | June 7, 2011

Benefits of Doing Business in The Dominican Republic

A country of unique culture, history and geography, the Dominican Republic   increasingly attracts foreign business from all over the world thanks to recent and modern economic changes. The last decade has been very successful for the country’s economic growth and transformation. Joining CARICOM & CAFTA,  and other treaties with North America and  the European Union, DR have opened the Dominican  market to foreign investors and development opportunities.

The Dominican Republic   receives one of the largest pools of EU funding for development and infrastructure which makes it very attractive to foreign investors. Its location in the heart of  the Caribbean in the Hispaniola island where Western and Eastern values meet creates an ideal opportunity for business development.

Below are some of the key benefits of doing business in the Dominican Republic  

Strategic Geographical Location
The strategic geographical location of the Dominican Republic   has played an important role in its development. Located on the crossroads between Eastern and Western Caribbean, DR is a link between West and East and offers the large market of Central , South and North  for trade and transport. Sharing borders only with Haiti, close by Miami and Central America provides wide trade opportunities.  Also, DR’s ports and over 400km of coastline enhance its trading opportunities. As a member of the CARICOM and CAFTA, DR also benefits from a free flow of goods and services.

Access to Developing Economy
the Dominican Republic   stands out as a success story among transition economies since its liberalisation in 1990, and today it has one of the most successful and fast-growing economies in  Latin America and the Caribbean. Its transformation to a democratic, market-oriented country raised DR’s profile on the international stage. DR potential was also recognised by the European Union which was generous in funding development, and this in turn attracted foreign investment. The Dominican Republic   is also a leader in Latin America  foreign direct investment with an inflow of 5 billion dollars (2006, DR Information and Foreign Investment Agency). DR’s future looks very promising thanks to the flow of foreign capital into its economy.

Country Tax Incentives and Government Support
Although the Dominican Republic is not typically regarded as a tax haven, that is actually one of its attractions. Unlike traditional offshore centres, it has not been under pressure from the likes of the OECD, the G20 and the Obama administration. The Dominican Republic has a territorial tax system much like Panama’s, meaning that you can live there and enjoy the beaches tax free, provided your income comes from outside the country. It’s also known as one of the more liberal places for those seeking a second passport or citizenship.

The Dominican Rep. government is in favour of foreign investments and has introduced business-friendly reforms to lower taxes. Government incentives depend on the costs of the investment and job creation, as well as the outcomes of negotiations with authorities. They are composed of three types of public aid: regional, horizontal and sectoral. Incentives also include various types of grants and can be combined with tax exemptions and loans. Foreign investors in Poland gain access not only to the DR market but also to the vast North America or  EU market. Investors doing business in DR can take advantage of lower production costs as a new member in comparison to those which are longer established. DR offers a large qualified workforce and its legal system is moving towards full harmonisation with Western standards.

Strong Relationships with Counterparts
The Dominican Republic has a family-focused society producto of its Spanish background and the dominican value close personal relationships. Due to DR’s history of occupation, it is generally the case that outsiders must earn the trust of their dominican acquaintances before a close relationship forms. For this reason Dominican people tend to adopt a fairly formal approach to begin with and it may take several meetings before any final decisions are made. However, Dominican  people are very friendly, down to earth  and appreciate the patience of their counterparts in establishing relationships and are very loyal to them once trust is established.

Understanding Dominican Republic  business culture and social traditions is key to doing business in DR effectively. Attending a Cultural Awareness Training DR course such as Hineni’s Doing Business in  the Dominican Republic will help individuals and organisations to maximise the benefits of their investments in this development-oriented country.

By playing safe, anyone can enjoy a fantastic holiday and do business in the Dominican Republic, but if you’re a font of local knowledge, we’d love to hear from you.

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Responses

  1. We are a bunch of volunteers and starting a new scheme in our community. Your website provided us with useful info to work on. You’ve performed a formidable job and our entire group can be thankful to you.


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