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Home Articles A long-awaited boost for one of the country’s key economic sectors

A long-awaited boost for one of the country’s key economic sectors

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Following an ambitious seven-pillar strategy, the Dominican Republic is investing in a more technological, cost-efficient, sustainable and export-oriented agricultural sector.

“Our main goal with this administration is to produce more with less”, states Minister of Agriculture Mr. Limber Cruz. While the Dominican Republic is recognized for its world-class agricultural products, a special focus on the agricultural sector was long overdue. The Ministry’s strategy is based on seven lines of action: financing, water, local roads, training and technical assistance, research, safety and commercialization.

Securing government financing, the Ministry received over USD $80 million at a zero-tax rate, in addition to normal rate credits, benefiting thousands of small and medium-sized producers. They started implementing short-term water projects like water wells, reservoirs, and drip irrigation systems; they are working on the restoration and completion of over 1000 km of roads to transport rural products; and they are offering thousands of virtual and on-site courses supported by a digital platform connecting technical experts and producers with the Ministry.

Implementing a double commercialization approach, for the internal trade they work with platforms like the Price Stabilization Institute (INESPRE) and Merca Santo Domingo to guarantee fair prices for both producers and consumers; and for the external markets, they aim to increase agroexports by offering a great price-quality ratio thanks to the country’s free trade zones and agreements, and their internationally certified organic products. Consequently, agroexports have grown, trade to the United States increased by 37%, and new markets are opening with the exportation of cigars, coffee and fruits to the Middle East.

With all these initiatives, the government’s plan to relaunch agriculture as one of the main pillars for economic growth looks highly promising. Right now, as Minister Cruz states, “the biggest challenge for the agricultural sector is to penetrate large markets without forgetting about local supply. We want agriculture to be more efficient, and since we are here, we have accomplished a lot.”

Actively supporting Dominican productive sectors

The Ministry of Industry and Commerce’s determined support has directly contributed to the outstanding dynamism and growth of the country’s industry.

With a Central Bank-anticipated growth of 8 to 9% and 5.5% GDP by the IMF, international reserves at an historical record of US $12,611.6 million, FDI increase of 49.4% and a 14.3% manufacturing and industrial sector growth, the Dominican Republic has one of the most dynamic and fastest growing economies in the region. Behind those numbers, the policies and programs of the Ministry of Industry and Commerce have been crucial.

In 2021, the Ministry enacted several laws to boost productivity and foreign investment like the Customs Law; the Regulatory Improvement and Simplification of Procedures; or the Special Zone for Comprehensive Border Development. They also launched the 2030 Digital Agenda to promote the country’s digital transformation; the project “Dispatch in 24 hours”, to reduce container merchandise delivery times; and approved 71 free zone companies and 5 industrial parks with investments of US $146.27 million and US $42.67 million respectively.

Moreover, the Ministry plans to relaunch the free zone sector to improve special regime permissions, promote productive chains and investment, strengthen infrastructure and access to financing. The
Dominican Republic is one of the world’s pioneers in implementing the free trade zone model, and in the last 10 months these zones registered record export numbers, representing 61% of the total exported, about 173,000 direct jobs, and a 30% growth, with 77 free zone parks and more than 700 companies.

The Ministry aims to improve the country’s position in the Doing Business and the Global Competitiveness Index by implementing several initiatives that have been in execution for several years, like the Single Window for Formalization, the Single Investment Window, the Single Window for Construction Permits, or the Electronic System of Secured Transactions. Also important is the presidency-promoted national dialogue to discuss key reforms and the National Competitiveness Strategy that will be launched soon.

Modernizing cacao industry in the Dominican Republic

Thanks to its new processing plant, Grupo CONACADO is paving the way for the future.

Cocoa is one of the country’s main exports with US$200 million revenues. Even more, the Dominican Republic is a global leader producing 60% of the world’s exported organic cocoa. However, there are some challenging facts: cocoa is still a traditional industry, 80% of its producers are small farmers close to retiring, and younger generations are not too keen to replace them. Therefore, Grupo CONACADO, the country’s leading holding company in the production, processing, and marketing of cocoa, is intent in modernizing the sector to boost production and make it more economically sustainable and attractive to new generations with their star project “the farmer of the future”.

To achieve this, they partnered with longtime associates and world’s leading cocoa manufacturers, Dutch company Royal Duyvis Wiener, to open a state of-the-art cocoa processing plant that will produce cocoa liquor, butter, cake, powder and other by-products, as well as its first chocolate production. As Mr. Isidoro de la Rosa, president of Grupo CONACADO, explains, this plant “will be the most advanced in the Dominican Republic, Central America, and the Caribbean. It will guarantee an added value for the new generations, along with the promotion of purely Dominican artisan chocolate.”

Additionally, Grupo CONACADO has an agreement with the French Development Agency to promote Cacaoforest, a historically-implemented agroforestry system combining cocoa and forests. Since monocropping has led to deforestation and biodiversity degradation, their project aims to implement to technology-supported traditional farming so it can foster real sustainable development, as it benefits some 42,000 families and there is an entire commercial and industrial infrastructure behind it.

Currently 70% of their exports go to Italy, England, Belgium, and the Netherlands; and 30% to the United States, a traditionally low-price market where the high-quality organic niche is prospering. Furthermore, once the new plant starts producing, they expect to add the Chinese, Arab and Japanese markets. No wonder they are excited. Like Mr. De la Rosa states, “this organization is my greatest satisfaction: seeing how far it’s gone, how this sector had never been this organized, and the fact that it became a global leader, it all makes us very proud.”

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