The Economy of Dominican Republic

The economy of the Dominican Republic continues to grow rapidly

Photo credit: © Lidian Neeleman |

The Dominican Republic's Economy

Unlike other Caribbean islands where politics and economic survival go hand-in-hand, the Dominican Republic's political history has not affected its economic history. While the small country has recently struggled with incredible debts, its historic struggles were not always caused by economic hardships.

Going for the Gold

The earliest Spanish settlers came to the island to find gold. Although they enslaved the native Taínos, which caused political strife and several uprisings, the Spanish helped create a prosperous settlement in the "New World," which included the thriving city of Santo Domingo.

However, the Spaniards' reign faded when gold and silver were discovered throughout Central America, including Spanish-occupied Mexico. By this time, African slaves belonging to European settlers were being shipped to the island of Hispaniola to work on sugar plantations, and the trade and growth of sugarcane was firmly established.

Agricultural Arts

Despite firmly established agricultural operations, power on the island changed hands several times. From the Spanish to pirates, French, and finally to slaves and former-slaves, the government of the island was often disrupted. However, sugarcane kept the island's economy afloat.

Coffee, cocoa, bananas, tobacco, and rice have also been farmed in the Dominican Republic but have always taken a backseat to the production of sugarcane. Recent years have brought changes to the island, and agricultural pursuits have declined greatly since the 1960s.

Modern Economics

By the 1970s, the economy began to diversify with the introduction of mining, manufacturing, and tourism. Mining for rock salt, bauxite, nickel, copper, zinc, gold, silver, and platinum has gained importance, but clothing manufacturing is the main industry on the island.

It was tourism, however, that grew so greatly in the 1980s that the number of hotel rooms quadrupled. Also in the 1980s, the revenue from tourism also managed to overtake agriculture revenue two times, marking an important turning point in the economy of the Dominican Republic.

Numbers Speak

In the late 1990s and early part of this century, the GDP of the Dominican Republic has increased greatly. In 2003, a significant decline in tourism, a U.S. economic recession, and headline-generating bank fraud caused some economic setbacks. In 2004, however, there were again some gains.

President Fernandez, elected in 2004, has made some moves toward economic reform, but these strides have left the country with an extremely off-balance distribution of wealth. The GNP is currently divided so that the top 10% gain 40% of the wealth, with a very stratified social system.

The Dominican Republic has had a long period of economic stability and has recently seen some growth. However, the island's politics have long since held the island back from achieving its full potential, but tourism is helping the Dominican Republic to achieve its economic goals.


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