{"id":10598,"date":"2024-07-22T14:13:43","date_gmt":"2024-07-22T14:13:43","guid":{"rendered":"https:\/\/dmklawyers.com\/?p=10598"},"modified":"2024-07-22T14:13:46","modified_gmt":"2024-07-22T14:13:46","slug":"bc-maintains-favorable-economic-outlook-for-the-country-despite-challenging-global-environment","status":"publish","type":"post","link":"https:\/\/dmklawyers.com\/en\/bc-maintains-favorable-economic-outlook-for-the-country-despite-challenging-global-environment\/","title":{"rendered":"BC maintains favorable economic outlook for the country, despite challenging global environment"},"content":{"rendered":"\n

In its most recent report on the global economic outlook, the International Monetary Fund (IMF) forecasts that global economic growth will remain resilient, although economic recovery is likely to take longer than previously expected.<\/p>\n\n\n\n

Despite a challenging global environment due to conflicts in the Middle East and a slowdown in global growth, the Dominican economy maintains favorable forecasts for the years 2024 and 2025, according to a report by P\u00e1gina Abierta authored by Osvaldo Lagares from the Department of Regulation and Financial Stability of the Central Bank (BCRD).<\/p>\n\n\n\n

The publication titled “Growth and Stability Perspectives in the Dominican Republic” emphasizes that the Dominican economy exhibits a better investment climate and greater economic and financial stability compared to previous years and during the Covid-19 pandemic.<\/p>\n\n\n\n

“Productive activities have expanded, inflationary pressures have eased, and employment has increased to historic levels, promoting stability, growth, and national economic development,” he states.<\/p>\n\n\n\n

According to the author, this economic performance has contributed to improvements in the country’s credit rating outlook published by major international rating agencies.<\/p>\n\n\n\n

“In this regard, the Emerging Markets Bond Index (EMBI) for the Dominican Republic, calculated by the U.S. financial services firm JPMorgan Chase, which serves as a benchmark for country risk in emerging and developing economies, is 32.5% below the regional average for Latin America and 22.6% below the global average, at levels lower than economies such as Mexico, Colombia, and Panama,” he adds.<\/p>\n\n\n\n

The main economic outlook for the Dominican Republic in 2024 suggests that economic growth will return to its potential path of 5.0%, inflation will remain around the center of the policy target range of 4.0% \u00b1 1.0%, and interest rates will trend downwards if risk factors do not intensify.<\/p>\n\n\n\n

Additionally, it is expected that the exchange rate will remain relatively stable around its historical average variation, given the foreign exchange earnings received by the country, with projections indicating these earnings will exceed those of 2023, when remittance flows reached US$10.1572 billion, tourism revenues amounted to US$9.8289 billion, and foreign direct investment totaled US$4.381 billion.<\/p>\n\n\n\n

Furthermore, the adoption of macroprudential policies and proper management of financial intermediaries’ liquidity to reduce systemic risk and facilitate the channeling of resources to productive sectors, households, and SMEs, will contribute to expanding credit and revitalizing the economy in an environment of price stability and financial system stability.<\/p>\n\n\n\n

Recent Domestic Environment<\/strong><\/p>\n\n\n\n