A. ZARZUELA. DOMINICAN REPUBLIC: LAND OF OPPORTUNITIES

Alejandro Arias Zarzuela, Ambassador Extraordinary and Plenipotentiary of the Dominican Republic to the Russian Federation

DOMINICAN REPUBLIC:MORE THAN BEACHES
When Russians hear about the Dominican Republic, the first thing that springs to mind are the heavenly beaches, majestic mountains, and lush forests, the buildings of Santo Domingo, the oldest capital on the continent, dating back to the 15th and 16th centuries, the vibrant rhythms of bachata and merengue, the rich culinary culture, and countless memories of the place filled with leisure and fun. This is the impression held by the majority of Russian tourists who have visited the Dominican Republic over the past decades, witnessing the joy, hospitality, and kinship between our peoples. However, the Republic has a hidden facet, less known in Russia but no less important—the economy.

Over the past three decades, the Dominican Republic has seen an average annual GDP growth of 5%, resulting in nearly a 150% increase in the ation’s economy and turning it into the seventh largest in Latin America. Such progress is due to deliberate actions by national leadership, which has helped to build consensus on coherent and long-term government programmes, prioritising political, social, and economic stability. Such environment fosters vital business activities that contribute to the nation’s development, particularly as a logistics hub for production and export.

Moreover, the favourable business climate and sophisticated legislation turn the Republic into a promising destination for foreign direct investment. It is a leader in Central America and the Caribbean, and one of the most significant actors when it comes to Latin America as a whole, encouraging the economy to expand in a consolidated manner.

DOMINICAN-RUSSIAN RELATIONS
In October 2024, the Dominican-Russian relations have entered a historic phase, as the Russian government announced its decision to establish a Russian embassy in Santo Domingo.

The diplomatic mission was inaugurated in 2025, coinciding with the 80th anniversary of the establishment of diplomatic relations between the countries. Following this, in April this year, for the first time in the history of Dominican-Russian relations, Russian Foreign Minister Sergey Lavrov made an official visit to the Dominican Republic.

These developments are a vivid example of robust ties between the nations, giving a new impetus to the political dialogue on matters of common concern, namely economy and trade, tourism and investments, technical and academic cooperation, and cross-cultural interaction. All of this brings the relations to a higher and richer level.

It is also noteworthy that the Dominican Republic and Russia have signed a bilateral agreement on economic and trade cooperation, setting patterns in these areas. The document seeks to expand trade and investment, dismantle barriers, and deepen ties in spheres of mutual interest.

Another area of special focus is restoring direct flights between the Republic and Russia—a good opportunity for Santo Domingo to transform the country into an air hub for Latin America through codeshare agreements with Dominican airlines. Direct flights will enhance logistics and, consequently, foster the development of tourism, trade, and cooperation across various sectors. In light of these emerging opportunities, we would like to share with the readers the key aspects that are drawing an ever-growing interest to the Dominican Republic.

WHY THE DOMINICAN REPUBLIC?
Today, the Dominican Republic boasts a wide range of investment opportunities, driven by a number of factors that ensure the country’s competitiveness and make it an attractive business destination.
Strategic Location. Nestled at the very heart of the Caribbean, the Dominican Republic has become a vital trade hub between continents, offering preferential access to over 1.2 billion consumers through free trade agreements with the United States and Central America under DR-CAFTA, as well as with the EU via the Economic Partnership Agreement (EPA) and various other regional integration mechanisms.
Robust Legal Framework and Incentives. The Dominican government encourages Foreign Direct Investment (FDI) through a trustworthy legal system that not only ensures legal security for investors but also offers incentives and tax exemptions, ensuring a higher return on investment. These measures foster job creation, boost national growth and development.
Advanced Infrastructure. The Dominican Republic boasts a well-developed social infrastructure tailored to the needs of a society focused on production and commercialisation of goods and services. This is equally true for its transport network. The country has one of the best road networks in the region, connecting pretty much its each and every corner. Additionally, the Republic features a modern system of airports and seaports, complemented by an advanced and reliable telecommunications infrastructure.
Wealth and Diversity of Natural Resources. The Dominican Republic is a treasure trove of natural wonders— stunning beaches, fertile soils, a warm climate, and extensive mineral deposits—which make the country an ideal destination for investment opportunities.
Skilled Workforce. The Republic is committed to a future based on competitive human resources, environmental sustainability, and technological innovation as key drivers of development. It fosters an environment conducive to cooperation by providing essential support and assistance to businesses, thereby promoting entrepreneurship in the country.

FDI IN THE DOMINICAN REPUBLIC
Foreign Direct Investment (FDI) is a primary source of foreign currency inflow, boosting job creation and economy as a whole. Official statistics from the Dominican Central Bank read that foreign currency inflow from FDI between 2014 and 2023 amounted to 30,192.5 billion USD, yielding a stable average annual inflow of 3,019.3 billion USD with consistent growth rates.

In 2023, the volume of FDI reached 4,390.2 billion USD, representing a 7.1% increase compared to the previous year and surpassing the 4 billion USD mark for the second consecutive year. Consequently, the country became the leading destination for FDI in Central America and the Caribbean.

Between 2022 and 2023, 76.5% of FDI was concentrated in four sectors: tourism, energy, trade/industry, and real estate. The remaining 23.5% was distributed among free zones, mining, finance, telecommunications, and transport. Topping the list are investments in tourism, which maintain the lead due to their significant appeal. The energy sector followed, accounting for 21.4%, driven by substantial growth and development in urban and tourist areas. Trade and industry rank third, with an investment volume of 1,298.6 million USD.

It is noteworthy that the real estate and free economic zones are experiencing dynamic growth, accounting for 13.5% and 8.4%, respectively. Both sectors are creating thousands of jobs and facilitating technology transfer, enhancing the skills of the local workforce.
Moreover, the mining, financial, telecommunications, and transportation sectors displayed a 15.1% surge in large foreign investments.

FDIs play a crucial role in the development of the external sector—the inflow of such investments is a testament to that—which reached 10.7% of the total foreign currency inflow into the Dominican economy in 2022–2023.

Thus, these long-term FDIs underscore the leading role and appeal of the Dominican Republic to foreign investors. In 2024, for the third consecutive year, it has topped the region in attracting FDI to Central America and the Caribbean, consolidating its role as regional leader.

FOREIGN BUSINESS IN THE DOMINICAN REPUBLIC
Under Dominican Republic law, foreign businesses conducting activities and commercial operations in the country are subject to the same regulations as local entities and companies.

In practice, a foreign business can operate in the Dominican Republic as a branch, with the only requirement to register in the Commercial Registry and to obtain a tax identification number from the National Taxpayer Registry of the General Directorate of Internal Taxes (RNC). Once the necessary documentation is obtained, the registration takes about three to four weeks.

LEGISLATION AND INCENTIVES FOR FOREIGN INVESTMENTS
Businesses in the Dominican Republic benefit from the Foreign Investments Law and a comprehensive system of incentives established by various regulations aimed at developing and revitalising key sectors of the national economy.

The Foreign Investments Law No. 16-95 enshrines the principle of national treatment for foreign investors and the free repatriation of capital. Among the special incentive regimes are Free Zones, Border Development Zones, and designated industries under the Industrial Development and Competitiveness Center (PROINDUSTRIA). Special laws also provide incentives in areas such as film industry, tourism, renewables, solid-waste processing, and textiles. Moreover, other regulations offer incentives for residents and pensioners with foreign income sources to import personal belongings.

Furthermore, Decree 950-01 on investment-based residency offers additional advantages, including the liberalisation of dividends and capital repatriation, free currency convertibility, an investment and technology transfer registration certificate. There is also a residency-by-investment programme that requires a FDI registration certificate for a minimum amount of 200,000 USD.

INVESTMENTS
The Dominican Republic boasts a whole spectrum of sectors that are appealing for FDIs.
Energy. The Republic provides an exceptionally conducive climate for private investments in diverse energy projects, supported by a friendly legal framework, applying to both conventional and alternative energy. The Dominican energy market is shared by companies involved in the generation, transmission, and distribution/commercialisation of electricity. The transmission system operates on an open-access basis with regulated tariffs.

Mining. The Dominican geological profile has enabled the Republic to secure the status of a mining powerhouse in the Americas over centuries. Today, the nation ranks second in gold reserves on the continent, producing a wide range of minerals, including gold, silver, bauxite, ferronickel, clay, industrial minerals (such as kaolin, feldspar, silica sands, etc.), larimar, amber, slate, limestone, gypsum, salt, metallic and non-metallic resources.
Solid-Waste Management. Law No. 1-12 on the National Development Strategy up to 2030 identifies solid-waste management as a priority sector with great FDI potential in its Fourth Strategic Axis. With the enactment of Law No. 225-20 on Comprehensive Management and Co-processing of Solid Waste, the country aims to prevent waste generation while establishing a legal framework for comprehensive waste management to encourage reduction, reuse, recycling, disposal, and recovery.

Agriculture. The Dominican Republic is a country with vast agricultural potential, endowed with highly fertile soils and lands suitable for year-round fruit and vegetable cultivation, making it ideal for agricultural production. Currently, the sector provides around 400,000 jobs. The Dominican Central Bank states that the real added value of agricultural activities experienced an annual growth of 3.9% in 2023, driven by crop (5.4%) and livestock farming, forestry, and fishing (1.2%).
Real Estate. Over the past decades, the real estate and construction sector has witnessed significant growth. Bolstered by private initiatives to develop medium- and low-cost real estate, commercial establishments, hotels, and investments aimed at diversifying the electric generation system, the real estate sector has emerged as one of the most important in the vibrant Dominican economy.
Film Industry. The country’s breathtaking landscapes—from majestic mountain ranges and full-flowing rivers to fertile valleys and arid plains—are ideal for all types of audiovisual production. Cities feature a variety of architectural styles ready to immerse the viewer into any time period, with the historic colonial centre starring in such films as “The Godfather Part II,” “Havana,” “The Bourne Supremacy,” “Miami Vice,” “The Lost City,” “The Feast of the Goat,” and many others. The rich diversity of landscapes, renowned professional film and audiovisual studios, supported by tax incentives, make the Dominican Republic an excellent location for film production.
Information Technology. The Dominican software industry mostly consists of SMEs with high sectoral diversification, providing solutions across various industries, including tourism, trade, manufacturing, healthcare, telecommunications, banking, public administration, education, construction, and advertising. The strengths of the information technology sector lie in its pool of skilled IT personnel and software developers, as well as an ecosystem of relevant companies such as Adofintech, Cámara TIC, and ClusterSoft.
Telecommunications. The Dominican Republic continues to strengthen its modern telecommunications infrastructure, while offering services that include CDMA, GSM, 2.5G, 3G, 4G, and 5G technologies, as well as extensive use of satellite communications and other technologies. The Dominican Central Bank indicates that the sector showed an annual growth of 5.6% in 2023, primarily driven by a 7.2% increase in mobile services and a 9.5% surge in internet services. The Republic is the first and only country in Central America and the Caribbean to possess an interconnected NAP system, featuring over 800 km of fiber optic cable connected to more than 190 global NAPs.
Tourism. The country’s strategic geography gives a significant advantage to tourism, providing excellent connectivity with the rest of the Americas and beyond. The nation holds the largest number of air and sea routes in the entire Caribbean, with 8 airports facilitating over 360 daily flights and 6 cruise terminals. The extensive road network connects various points across the country, ensuring swift and safe travel. The legal and institutional framework also encourages and secures investments in the sector. The Dominican Republic remains the top tourist and golf destination in the Caribbean and a leader in attracting foreign investment in tourism.
Manufacturing and Services. The country has emerged as a hub for manufacturing and services, successfully attracting companies with foreign capital that establish relevant export platforms. The majority of these companies have been spurred by the free zone regime. Today, there are 84 free zone parks with 774 companies (creating 192,461 jobs), with nearly 59% of these operating in sectors such as services, tobacco and its derivatives, as well as garments and textiles.
Medical Devices and Pharmaceuticals. The country offers substantial advantages for companies engaged in the development and production of medical devices and pharmaceuticals, including a highly skilled workforce at competitive prices, modern infrastructure, strategic location, and preferential access to the markets of the United States, Europe, Central America, and the Caribbean. Within the free zone industry, this sector ranks first in terms of accumulated investment concentration over the past decade, showing dynamic and sustained growth due to the development of production capacities by leading global companies.
Mining is one of the most vital sectors of the Dominican economy. With the second-largest gold reserves on the continent and a diverse array of minerals produced, the country offers extensive opportunities for investment Cigar Production.
Cigar Production. The Dominican Republic is renowned for its rich tobacco culture. The vigorous development of the agro-industrial tobacco leaf production has significantly boosted cigar production, exported to various countries worldwide. Tobacco is a traditional sector in the Republic, particularly in the northern region, especially suitable for its cultivation. The provinces of Santiago, La Vega, and Espaillat are leaders in the national production of this crop. The entire tobacco production process affects its final quality, starting with the choice of soil, harvesting, drying, storage and fermentation.
Garments and Textiles. Leveraging vast expertise in the sector and bilingual staff, the Dominican Republic offers technology-based advanced manufacturing capabilities adjustable to new design solutions, R&D, and value addition to end products. In 2023, the export of garments and textiles accounted for 12% of total exports from free zones, reaching a total of 930.3 million USD.
Call Centres. The Dominican Republic is an attractive investment destination in the services sector, particularly through call centres and business outsourcing. Incentives, modern telecommunications infrastructure, and other technological advancements enable the industry to address new challenges brought about by the customer service revolution. The sector is primarily focused on telecommunications and financial services (62% of activities).

The geographical, legal, and economic advantages of the Dominican Republic make it a compelling destination for companies planning to expand their business to other regions of the world. The country should be thoroughly evaluated when considering external scenarios for the internationalisation of production, distribution, and commercialisation of goods and services.

Those who wish to learn more about the opportunities of this multifaceted nation has to offer are invited to contact the Embassy of the Dominican Republic in the Russian Federation.