Business Opportunities in the Caribbean Market:

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Business Opportunities in the Caribbean
Market Dominican Republic
February 12, 2009
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The Caribbean region imports 20.3 billion of US
products and services
Dominican Republic US5.63 billion
Barbados US410 million
Jamaica US2.31 billion
The Bahamas US2.34 billion
- 26 Markets, 41 million people - Total imports
53 billion - Regional GDP growth 4.6 - US
import market share 38
Trinidad Tobago US1.88 billion
Source U.S. Import and Export Merchandise trade
statistics. October 2008
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Caribbean Region A Sizeable Export Market
Italy US13.3
Caribbean US20.3
Malaysia US11.3
Chile US10.6
Australia US19.2
India US16.4
Brazil US27.8
Source U.S. Import and Export Merchandise trade
statistics. October 2008
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Why Export to the Caribbean Region?

• Close Proximity to the United States
• 3rd Largest Market in Latin America for
  U.S. Exports 
• Cooperative Trade Relationship
• Free Trade
• Regional Integration

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The Bahamas HIGHLIGHTS

• Population 307,000
• GDP 6.58 billion
• GDP growth 3.1
• Bilateral Trade US/DR 539 million
• Imports from US 2.60 billion
• US Imports Market Share 23

Sources Statistics in U.S. Dollar U.S. Import
and Export Merchandise trade statistics. October
2008
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Barbados HIGHLIGHTS

• Population 281 ,000
• GDP (2008) 5.31 billion
• GDP growth 3.8
• Bilateral Trade US/DR 437 million
• Imports from US 460 million
• US Imports Market Share 35.9

Sources U.S. Import and Export Merchandise
trade statistics. October 2008 The CIAs World
Fact Book 2008
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Jamaica HIGHLIGHTS

• Population 2.67 million
• GDP 9.7 billion
• GDP growth 2.5
• Bilateral Trade US/DR 690 million
• Imports from US 2.5 billion
• US Imports Market Share 40.1

Sources U.S. Import and Export Merchandise
trade statistics. October 2008
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Trinidad Tobago HIGHLIGHTS

• Population 1.3 million
• GDP 20.9 billion
• GDP growth 5.5
• Bilateral Trade US/DR 5.7 billion
• Imports from US 2.1 billion
• US Imports Market Share 28.2

Sources U.S. Import and Export Merchandise
trade statistics. October 2008 Central Bank of
the Dominican Republic
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Dominican Republic HIGHLIGHTS

• Population 9.36 million
• GDP 36.4 billion
• GDP growth 4.8
• Bilateral Trade US/DR 14.8 billion
• Imports from US 6.16 billion
• US Imports Market Share 48
• Ranking for U.S. Exports to WH 8th Largest

Sources U.S. Import and Export Merchandise
trade statistics. October 2008 Central Bank of
the Dominican Republic
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Why Export to the Dominican Republic?

• On-going market liberalization
• Proximity to U.S.
• 70 of consumer goods imported into the DR are
  from the U.S.
• Tariffs were removed on 80 of U.S. goods under
  DR-CAFTA
• Growing use of English in business
• U.S. Standards widely recognized and accepted
• Few import restrictions
• Labeling and testing not typically a problem

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Dominican Republic ADVANTAGES

• State-of-the-art
• ICT infrastructure
• Modern FTZ infrastructure
• Seven international airports
• Eight major seaports

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Best Prospect Sectors in The Dominican Republic
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Hotel Restaurant Equipment Supplies

• Tourism continues to be an important segment of
  the Dominican economy.
• Activities at hotels, bars and restaurants in the
  Dominican Republic registered an increase of 3.7
  percent in 2007 when compared to 2006.
• This performance reflects the 2.8 increase on
  tourism income (from RD3.9 billion in 2006 to
  RD4.02 billion in 2007) due to the arrivals of
  more than 3 million tourists in 2007.
• There are approximately 64,800 available hotel
  rooms.
• There was also a considerable increase in the
  hotel occupancy rate (from 72.2 in March 2007 to
  80.6 in March 2008) especially in the most
  popular areas such as La Romana / Bayahibe and
  Punta Cana/Bavaro.

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Travel Tourism Services

• Statistics indicate a decrease of DR travelers to
  the US in the first 10 months of 2008, due in
  part to the global economic crisis and the
  reduction in the number of flights by the major
  airlines servicing the DR/US routes that started
  in September 2008 due to the increase in oil
  prices.
• Industry sources indicate that this trend may
  change in 2009 since starting in December 2008
  several airlines increased the frequency of their
  flights and others are planning on adding
  additional flights in the next month to
  accommodate the travel demand.
• Destinations such as New York City, Orlando,
  Chicago, Las Vegas and Miami are still the most
  favorite for Dominican travelers.
•  
• Best Products/Services include Wholesale of
  travel products and services, Transportation
  services (air travel and ground transportation),
  Car rentals, Hotel industry, Attractions / theme
  parks.

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Automotive Spare Parts and Accessories

• In the Dominican Republic the demand for
  automotive spare parts is linked to the aging car
  population, the growth in total vehicle
  population, and the deterioration of Dominican
  streets and roads.
• There is also a general tendency in the Dominican
  Republic to overextend the useful life of
  vehicles due to their high cost. This influences
  the increasing demand for automotive parts and
  services.
• Although the market for these products is
  expected to increase by 5 percent only, imports
  from the U.S. will increase by 10 percent by the
  year 2009.
• U.S. automotive spare parts exporters have
  managed to increase exports to the Dominican
  Republic mainly because of the CAFTA-DR, which
  decreased the import tax levied to U.S. products
  from 20 to 0 percent for most products, while
  others are going through a phase-out process of
  up to 10 years.

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Medical Equipment

• The Dominican market for medical equipment is
  mainly supplied by imports, about eighty percent
  of which comes from the U.S.
• The import market is expected to grow 5 percent
  over the next two years and U.S. suppliers will
  continue playing a large role as a result of
  CAFTA-DR.
• There are no import regulations for the
  enforcement of quality, technical, or safety
  standards. American standards for medical
  equipment are currently accepted and respected in
  the Dominican Republic.
• To succeed in the Dominican market of Medical
  equipment Surgical Instruments and Supplies, an
  American company must have a local distributor or
  agent.
• Exporting directly to the private hospitals is
  extremely difficult and procurement practices in
  public hospitals indicate that all purchases must
  be done to a local company.

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Computer Peripherals

• The Dominican Republic market for computers and
  peripherals is heavily dependent on imports from
  overseas and the market is very receptive to U.S.
  products (seventy percent of all imports come
  from the U.S.).
• There are no duties on the importation of
  Computer and Peripherals products into the
  Dominican Republic.
• The government considers it very important for
  the Dominican Republic to try to close the
  technology gap and is taking steps to increase
  the use of computers in the country.
• The government has also reactivated the Instituto
  Tecnologico de las Americas, or ITLA
  (Technological Institute of The Americas), which
  is a government-sponsored technological school
  specializing in information technologies.
• The Presidential Office for the Information and
  Communication Technologies (Oficina Presidencial
  de Tecnologias de la Informacion y Comunicacion),
  is also having an active role in the promotion of
  these technologies.

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Building Products

• The sector experienced an increase a 10 in 2008.
  Building products continues to be an important
  sector and there are opportunities for US
  exporters.
• The sector is expected to continue to grow in
  2009 by 8 since the government of the Dominican
  Republic (GODR) is awarding contracts for new
  infrastructure projects. These projects include
  the construction of bridges, roads and low-cost
  housing units.
• The private sector offers a wide range of
  opportunities in the tourism development
  projects, and residential and commercial new
  constructions in the largest cities of the
  country, such as Santo Domingo, Santiago, San
  Francisco de Macoris, La Romana, among others.
• Best prospects include Heavy Construction
  Equipment, Aluminum doors and windows, Bathroom
  and kitchen fixtures, Wood lumber and wood
  products, Electrical fixtures, Lighting products,
  Plumbing and welding products, Roof products
  (sealers), Steel products, Prefabricated
  structures and Hand tools.

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Air Conditioning and Refrigeration Equipment

• The Dominican Republics total imports of air
  conditioning and refrigeration equipment in 2007
  were US38.2 million.
• The U.S. is the principal supplier to the
  Dominican Republic of air conditioning and
  refrigeration equipment, with an estimated 53
  percent of the import market in 2007.
• This market share is expected to maintain its
  levels in 2008 and 2009 and with the CAFTA-DR
  implementation since the majority of the air
  conditioning and refrigeration products
  manufactured in the U.S. are entering duty free
  into the Dominican Republic.
• The most promising sub-sectors within this sector
  are residential freezers and refrigerators, Cold
  storage equipment for the food industry and
  residential and commercial air conditioners.

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Printing Graphic Art Equipment

• This sector in the Dominican Republic represents
  the largest graphic industries in the Caribbean.
  There are approximately 2,500 companies operating
  in the local market.
• Approximately 80 percent of these firms are small
  enterprises, and 20 percent are medium-to-large
  size companies, including newspapers, editorials,
  distributors and wholesaler of paper, machineries
  and consumable products.
• There is no local production of printing and
  graphic arts equipment and supplies in the
  Dominican Republic therefore, the demand is
  entirely supplied by imports.
• The total Dominican Republic market size for
  printing and graphics arts equipment, spare parts
  and consumable products, including printing paper
  is estimated at US258 million.
• The US is the absolute market leader in the
  printing and graphics industry.

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Renewable Energy

• The passage in May 2007 of the Renewable Energy
  Incentives Law (57-07) provides a number of
  incentives to businesses developing renewable
  energy technologies.
• This law was passed as part of the Dominican
  governments efforts to invigorate the local
  production of renewable energy as well as
  renewable energy manufactured products.
• The incentives include a 100 percent exemption
  from taxation on imported inputs (equipment and
  materials) and a 10-year exemption from all
  taxation on profits up to, but not beyond, the
  year 2020.
• Best prospects include Wind power equipment and
  supplies, Solar Energy production systems,
  Biomass equipment and Ethanol production
  equipment.
•  

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www.BuyUSA.gov/caribbean
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Contact us !
Robert O. Jones, Jr. Commercial Counselor For the
Caribbean Region
Maria Elena Portorreal Senior Commercial
Specialist
Isolda Frías de Gottschalk Commercial Specialist
Sheila Díaz de Andújar Commercial Specialist
Yira Roa Commercial Specialist
Tel [phone] Fax [phone] Santo.domin
go.office.box_at_mail.doc.gov
www.BuyUSA.gov/caribbean