- ECLAC foresees a conservative scenario due to the international context
- The IMF expects a “solid” growth rate
The Dominican economy maintains its leadership in the Central American and Caribbean region due to its growth pace, which could slightly decrease in 2025 compared to the projections estimated for the end of this year.
Unlike their end-of-2024 projections, which remain positive, both entities present slightly contrasting estimates, expecting real GDP growth between 4.5% and 5.0%, respectively.
ECLAC maintains a conservative scenario tied to the evolution of the international economic context, it told Diario Libre. “The unemployment rate is expected to remain mostly unchanged from the 2024 level, and once inflationary pressures experienced in 2021-2023 subside, inflation should continue within the Central Bank’s target range, around 3.5%,” it added.
Meanwhile, the International Monetary Fund (IMF) shows a more positive outlook. In its economic outlook report for the Americas, it considers that the Dominican Republic, along with Panama and Central America, will benefit from sustained remittance flows, which in turn will stimulate consumption within the economy and maintain “relatively solid” growth.
The IMF also forecasts that inflation for 2025 could reach 4.0%, three percentage points higher than its end-of-year forecast (3.7%), while keeping the same current account deficit at -3.4% of GDP.
This news is relevant in a context where growth in Latin America and the Caribbean is expected to slow down due to gaps in GDP growth, accompanied by an external environment that is “practically unchanged.”
Projection for the End of 2024
Both the Economic Commission for Latin America and the Caribbean (ECLAC) and the IMF estimate an upward expansion of the country’s real GDP by the end of 2024, between 5.2% and 5.1%, respectively.
“It is a high estimated growth rate, as found in this year’s economic study, and it is important to highlight the country’s efforts; the success, indeed, as it represents one of the highest growth rates in Latin America,” said ECLAC’s executive secretary, José Manuel Salazar, during the presentation of the “Social Panorama of Latin America and the Caribbean 2024,” published last Tuesday.
For this United Nations agency, the easing of monetary policy, keeping inflation within the target range (4% +/- 1%), and a more expansive fiscal policy would foster this outcome.
Likewise, they expect the unemployment rate to be above the 5.0% reached in 2023. Regarding the current account deficit, they foresee it around 3.6% of GDP, two percentage points higher than the IMF estimate, which places it at 3.4%.
For this financial entity, the Dominican economy will grow around 5.1% by the end of this year, 2.6 percentage points higher than in 2023 (2.4%), a result made possible by “strong export performance” and remittance flows, which allowed for “robust” economic expansion in early 2024.
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