Investment Opportunities and Trade Relations: Dominican Republic

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Investment Opportunities and Trade
RelationsDominican Republic
Santo Domingo, Dominican Republic
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Exports
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Dominican Republic Main Trade Partners
Values in Millions of US / January-December 2003

• EXPORTS
• Total 5,524
• United States of America 4,341.08
• Puerto Rico 620.74
• Haiti 127.28
• Holland 63.13
• South Korea 58.19
• United Kingdom 54.83
• Canada 48.56
• Belgium 41.21
• Germany 26.04
• Japan 22.20

• IMPORTSTotal 7,911
• United States of America 6,344.88
• Puerto Rico
  685.45
• Mexico 365.83
• Spain 168.94
• Japan 141.66
• Panama 117.36
• Germany 86.88

Source Central Bank of the Dominican Republic
and The Center for Export and Investment of the
Dominican Republic
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Main Export Products
Values in Millions of US / January-December 2003

• DOMESTIC
• Total 908.85
• Nickel-iron 199.47
• Sugar Cane 75.38
• Raw Cocoa in Grain 56.91
• Steel Ribs 39.15
• Beer 20.56
• Organic Bananas 19.14
• Conventional Bananas 14.47
• Sugar Cane Rum 13.99
• Cigars 12.94

• FREE ZONES
• Total 4,398.7
• Textiles 2,193.4
• Foot Wear 199.0
• Cigars 286.9
• Electrical Components 577.6
• Pharmaceuticals Products 330.6
• Jewelry 446.8
• Others 364.4

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Reasons to Invest in the
Dominican Republic

• Strategic geographical location
• Competitive and Qualified Labor Force
• Economic and Political Stability
• Excellent telecommunication services
• Profitable Legal framework for foreign Investment
  
• Preferential Access to the United States, Europe,
  Central America and the Caribbean.

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Geographical Advantages of the Dominican
Republic

• Mayor quantities of maritime and air connections
  in the Caribbean area.
• Competitive maritime transportation costs.
• United States Main commercial partner of goods
  and services export.

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TRANSPORTATION

• 7 Ports with distribution through the Atlantic
  Ocean and the Caribbean Sea.
• Construction of 2 Megaports San Pedro,
  Manzanillo, which Maritime Terminal and Logistic
  Center operate under Free Zone Regime.
• Excellent highways which connect the most
  important regions of the country.

• 8 International Airports, 2 in
• Santo Domingo, Santiago, Samana.
• La Romana, Puerto Plata, Punta
• Cana, Barahona
• More than 20 international flights
• per day to United States and
• Europe.

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Average Transportation Costs (US)
Destiny Miami
Source Interamerican Development Bank
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TELECOMMUNICATIONS

• Laws and Institutions that regulate the sector
• Law 153-98 of Telecommunications.
• Law 126-02 of Electronic Commerce and
• Digital Signatures
• Regulated by the Dominican Institute of
  Telecommunications (Instituto Dominicano de las
  Telecomunicaciones - INDOTEL).

• Opportunities
• Voice, Data and Video
• Industries
• Call Centers
• Internet by cable and mobile
• Tele-medicine
• Education Online
• Cable Programming
• Tele-marketing

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TELECOMMUNICATIONS

• Higher per capita consumption in
  telecommunications than in the United States.
• First country in Latin America that implements
  Online Education.
• 69 local television channels (UHF and VHF).
• Four Telecommunication Companies Orange
  Dominicana, Verizon, Tricom, Centennial.
• Over 3.2 Millions of lines (cable and wireless).
• Over 930,917 cable lines.
• Over 2. 3 Millions of wireless lines.
• Over 80,000 Internet connections.
• Lowest costs in T1 Line connections in Latin
  America

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Energy Sector

• Privatized since 1999
• General Electricity Laws
• Superintendence of Electricity

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Electricity Costs 2003 (US/KW)
Source Stanford Research Institute
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Qualified Labor Force
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Cyberpark of Santo Domingo
High Technology

• 5 minutes from Las Americas
• International Airport
• Total Area Available 200,000 m2
• Uninterrupted Electric Energy
• Water Supply System
• Redundant Fiber Optic Ring
• Point to Point Lease Lines
• Satellite Station
• Fiber Optic Connectivity and Linkups

• Call and Data Administration Services
• Teleconference, Frame Relay

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Free Zones
General Information

• 3rd largest exporter of footwear to the United
  States and 8th worldwide.
• Ranks 11th worldwide in garment and textile
  manufacturing exports to the U.S.

• Free Zone Parks 54
• Companies Installed 539
• Direct Employment 229,000
• Legal Framework Law 8-90
• Regulatory Institution
• National Free Zones Council

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Manufacturing Sector

• Electronic Components
• Electric Appliances and
• Auto-Parts
• Textiles, Footwear
• Pharmaceutical Products
• Medical Devices
• Jewelry

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Service and Technology Sector

• Software Development
• Tele Medicine
• Business Processing
• Outsourcing (BPO)

• Call Centers
• Customer Service
• Tele-Marketing (Sales)
• Telephone Directories
• Back Office Support
• Surveys

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AGRIBUSINESS

• Investment Opportunities
• Plasticulture
• Fruticulture
• Greenhouses for production of all types of
• vegetables for local as well as export
  markets
• Meat and dairy products production
• Aquiculture Farms (Shrimp, fish, lobster, etc.)
  
• Chicken Farms

• Tax exemption for raw material, equipment and
  machinery import.
• First exporter of organic Banana and Coffee to
  Europe.
• 80 countries import Dominican Tobacco.

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TOURISM
Opportunities

• Dominican Republic No. 1 Destiny in the
  Caribbean
• Special Incentives Law for the Promotion of
  Tourism Development
• Over 550 hotel projects
• Over 60,000 worldwide quality rooms
• Innumerable Colonial Monuments (built in 1500s)
• 22 great National Parks
• Richest Maritime Biodiversity of the West Indies
• Sport Tourism (fishing, rafting, surfing,
  rappeling, etc)
• Ecotourism, Medical Tourism

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MINING SECTOR

• First Semester 2004 Second Sector with major
  Investment in D.R. (US101.5MM)
• Companies such as Falconbridge (Ferronickel),
  Placer Dome, Unigold (Gold), Mobil (Exploration),
  Cemex, Cementos Andinos y Domicem (Cements) are
  currently installed in Dominican Republic.

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INVESTMENT
Opportunities
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Investment Incentives
Law 16-95

• Equal Treatment for local and foreign investments
• Minimum investment restrictions
• Free access to foreign exchange through local
  banks and the Central Bank of the Dominican
  Republic
• 100 repatriation of benefits
• Technology transfer recognized as investment
• Free currency conversion
• Fast and simple investment register process
• Investment Protection through the Multilateral
  Investment Guarantee Agency (MIGA) and the
  Overseas Private Investment Corporation (OPIC)
• Member of the World Trade Organization (WTO)

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Investment Incentives
Residence Program to the Investors

• Objective
• Benefit investors with a special residence with
  the same rights as any foreign resident in the
  country.

Main Requirement Foreign investment register
at CEI-RD
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Investment Regulatory Laws

• Law 153-98 Regulatory and Institutional
  Framework for Telecommunications
• Law 8-90 Special Regime of Customs Control and
  100 Tax Exemption
• Law 64-00 Conservation and protection of the
  environment
• Law 28-01 Development of Frontier Special
  Zones, Tax Exemption for 20 years
• Law 150-97 Establishes a rate of 0 for
  equipment and machineries for the
  agro-industrial sector
• Law 158-01 For the Promotion of Tourism
  Development
• Law 183-02 Establishes a regulatory regime for
  the national monetary and financial system,
  promotes an open market
• Law 126-02 Regulates all electronic commercial
  activities that are structured from the use of
  digital documents and data messages
• Law 3-02 Simplifies the process to incorporate
  a company.

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COMMERCIAL AGREEMENTS
Strengthening Relations for a Better Tomorrow
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Market Access
International Free Trade Agreements
Preferential Access to two of the worlds
largest economies 790 Million of Customers.

• Cotonou
• Tax-free entry of finished products to the
  European Union.

• Legislation with enlargement of the benefits of
  the Caribbean Basin (CBTPA).

450M
270M

• CARICOM

• Strategic Alliance
• Central American Common Market 40M

30M
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Free Trade Agreement DR-USA
Regulatory and Institutional Framework with
predictable and clear norms Main Objective
stimulate, expand and diversify trade between
parties, promotion of fair competence and
increase the investment among parties. Demands
transparency in governmental management and the
divulgation and information procedures of laws
and norms.
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Advantages of the FTA

• Improved Agreement than the one negotiated by
  the United States
• with Chile and the CA countries
• The only agreement made by the D. R. that
  includes all the national
• economic sectors
• Free immediate tariff access of the 99.5 of the
  North American
• tariff (except 17 footwear lines)
• Consolidation of the current preference levels
  (CBI, GPS)
• Obtained a quota for industrial product
  (lubricant), for the first time in
• an agreement with the United States
• Simple rules of origin that allow the
  accumulation of procedures with
• countries such as CAFTA, Canada and Mexico.

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Advantages of the FTA

• Offers collateral benefits in no reimbursable
  attendances for the
• transformation of the main Dominican
  Institutions
• Benefits of the ICC for the co-production with
  Haiti are assigned to
• the D. R.
• Harmonizes sanitary measures with United States
• Example Beef and Mango
• Reestablishment of purchase access of the public
  sector of the
• United States
• Preservation of the interpretative aspects
  reached in the WTO.

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• www.cei-rd.gov.do