Dominican Republic

Bureau of Western Hemisphere Affairs                                          
May 2007                                                                      
                                                                       
  Background Note: Dominican Republic                                         
                                                                       
  Tourists sunbathing near Santo Domingo in the Dominican Republic, November  
  24, 2002. [© AP Images] Flag of Dominican Republic is a centered white cross
  that extends to the edges divides the flag into four rectangles - the top   
  ones are blue (hoist side) and red, and the bottom ones are red (hoist side)
  and blue; a small coat of arms featuring a shield supported by an olive     
  branch (left) and a palm branch (right) is at the center of the cross; above
  the shield a blue ribbon displays the motto, DIOS, PATRIA, LIBERTAD (God,   
  Fatherland, Liberty), and below the shield, REPUBLICA DOMINICANA appears on a
  red ribbon.                                                                 
                                                                       
  PROFILE                                                                     
                                                                       
  OFFICIAL NAME:                                                              
  Dominican Republic                                                          
                                                                       
  Geography                                                                   
  Area: 48,442 sq. km. (18,704 sq. mi.), about the size of Vermont and New    
  Hampshire combined.                                                         
  Cities: Capital--Santo Domingo (pop. 2.25 million). Other city--Santiago de 
  los Caballeros (908,230).                                                   
  Terrain: Mountainous.                                                       
  Climate: Maritime tropical.                                                 
                                                                       
  Map of Dominican Republic, 2007. People                                     
  Nationality: Noun and adjective--Dominican(s).                              
  Population (2005): 9.033 million.                                           
  Annual growth rate (2005): 1.8%.                                            
  Ethnic groups: Mixed 73%, European 16%, African origin 11%.                 
  Religion: Roman Catholic 95%.                                               
  Language: Spanish.                                                          
  Education: Years compulsory--6 Attendance--70%. Literacy--84.7%.            
  Health: Infant mortality rate: 28.3/1,000. Life expectancy--70.2 years for  
  men, 73.3 years for women.                                                  
  Work force: 60.2% services (tourism, transportation, communications,        
  finances, others), 15.5% industry (manufacturing), 11.5% construction, 11.3%
  agriculture, 1.5% mining.                                                   
                                                                       
  Government                                                                  
  Type: Representative democracy.                                             
  Independence: February 27, 1844. Restoration of independence, August 16,    
  1863.                                                                       
  Constitution: November 28, 1966; amended July 25, 2002.                     
  Branches: Executive--president (chief of state and head of government), vice
  president, cabinet. Legislative--bicameral Congress (Senate and House of    
  Representatives). Judicial--Supreme Court of Justice.                       
  Subdivisions: 31 provinces and the National District of Santo Domingo.      
  Political parties: Dominican Liberation Party (PLD), Dominican Revolutionary
  Party (PRD), Social Christian Reformist Party (PRSC), and several others.   
  Suffrage: Universal and compulsory, over 18 or married.                     
                                                                       
  Economy (2005)                                                              
  GDP: $29.33 billion.                                                        
  Growth rate: 9.3%; (2006 est.: 11%).                                        
  Per capita GDP: $3,247.                                                     
  Non-fuel minerals (1.4% of GDP): Nickel, gold, silver.                      
  Agriculture (11% of GDP): Products--sugarcane, coffee, cocoa, bananas,      
  tobacco, rice, plantains, beef.                                             
  Industry (25% of GDP): Types--sugar refining, pharmaceuticals, cement, light
  manufacturing, construction.                                                
  Services, including tourism and transportation: 62% of GDP.                 
  Trade: Exports ($6.146 billion (FOB), including processing zones: textiles, 
  sugar, coffee, ferronickel, cacao, tobacco, meats and medical supplies.     
  Markets--U.S. (75%), Canada, Western Europe, South Korea. Imports--$9.876   
  billion: food stuffs, petroleum, industrial raw materials, capital goods.   
  Suppliers--U.S. (48%), Japan, Germany, Venezuela, Mexico, Colombia.         
                                                                       
  PEOPLE                                                                      
  About half of Dominicans live in rural areas; many are small landholders.   
  Haitians form the largest foreign minority group. All religions are         
  tolerated; the state religion is Roman Catholicism.                         
                                                                       
  HISTORY                                                                     
  The island of Hispaniola, of which the Dominican Republic forms the eastern 
  two-thirds and Haiti the remainder, was originally occupied by Tainos, an   
  Arawak-speaking people. The Tainos welcomed Columbus in his first voyage in 
  1492, but subsequent colonizers were brutal, reducing the Taino population  
  from about 1 million to about 500 in 50 years. To ensure adequate labor for 
  plantations, the Spanish brought African slaves to the island beginning in  
  1503.                                                                       
                                                                       
  In the next century, French settlers occupied the western end of the island,
  which Spain ceded to France in 1697, and which, in 1804, became the Republic
  of Haiti. The Haitians conquered the whole island in 1822 and held it until 
  1844, when forces led by Juan Pablo Duarte, the hero of Dominican           
  independence, drove them out and established the Dominican Republic as an   
  independent state. In 1861, the Dominicans voluntarily returned to the      
  Spanish Empire; in 1865, independence was restored. Economic difficulties,  
  the threat of European intervention, and ongoing internal disorders led to a
  U.S. occupation in 1916 and the establishment of a military government in the
  Dominican Republic. The occupation ended in 1924, with a democratically     
  elected Dominican Government.                                               
                                                                       
  In 1930, Rafael L. Trujillo, a prominent army commander, established absolute
  political control. Trujillo promoted economic development--from which he and
  his supporters benefited--and severe repression of domestic human rights.   
  Mismanagement and corruption resulted in major economic problems. In August 
  1960, the Organization of American States (OAS) imposed diplomatic sanctions
  against the Dominican Republic as a result of Trujillo's complicity in an   
  attempt to assassinate President Romulo Betancourt of Venezuela. These      
  sanctions remained in force after Trujillo's death by assassination in May  
  1961. In November 1961, the Trujillo family was forced into exile.          
                                                                       
  In January 1962, a council of state that included moderate opposition       
  elements with legislative and executive powers was formed. OAS sanctions were
  lifted January 4, and, after the resignation of President Joaquin Balaguer on
  January 16, the council under President Rafael E. Bonnelly headed the       
  Dominican Government.                                                       
                                                                       
  In 1963, Juan Bosch was inaugurated President. Bosch was overthrown in a    
  military coup in September 1963. Another military coup, on April 24, 1965,  
  led to violence between military elements favoring the return to government 
  by Bosch and those who proposed a military junta committed to early general 
  elections. On April 28, U.S. military forces landed to protect U.S. citizens
  and to evacuate U.S. and other foreign nationals.                           
                                                                       
  Additional U.S. forces subsequently established order. In June 1966,        
  President Balaguer, leader of the Reformist Party (now called the Social    
  Christian Reformist Party--PRSC), was elected and then re-elected to office 
  in May 1970 and May 1974, both times after the major opposition parties     
  withdrew late in the campaign. In the May 1978 election, Balaguer was       
  defeated in his bid for a fourth successive term by Antonio Guzman of the   
  Dominican Revolutionary Party (PRD). Guzman's inauguration on August 16     
  marked the country's first peaceful transfer of power from one freely elected
  president to another.                                                       
                                                                       
  The PRD's presidential candidate, Salvador Jorge Blanco, won the 1982       
  elections, and the PRD gained a majority in both houses of Congress. In an  
  attempt to cure the ailing economy, the Jorge administration began to       
  implement economic adjustment and recovery policies, including an austerity 
  program in cooperation with the International Monetary Fund (IMF). In April 
  1984, rising prices of basic foodstuffs and uncertainty about austerity     
  measures led to riots.                                                      
                                                                       
  Balaguer was returned to the presidency with electoral victories in 1986 and
  1990. Upon taking office in 1986, Balaguer tried to reactivate the economy  
  through a public works construction program. Nonetheless, by 1988 the country
  had slid into a 2-year economic depression, characterized by high inflation 
  and currency devaluation. Economic difficulties, coupled with problems in the
  delivery of basic services--e.g., electricity, water,                       
  transportation--generated popular discontent that resulted in frequent      
  protests, occasionally violent, including a paralyzing nationwide strike in 
  June 1989.                                                                  
                                                                       
  In 1990, Balaguer instituted a second set of economic reforms. After        
  concluding an IMF agreement, balancing the budget, and curtailing inflation,
  the Dominican Republic experienced a period of economic growth marked by    
  moderate inflation, a balance in external accounts, and a steadily increasing
  GDP that lasted through 2000.                                               
                                                                       
  The voting process in 1986 and 1990 was generally seen as fair, but         
  allegations of electoral board fraud tainted both victories. The elections of
  1994 were again marred by charges of fraud. Following a compromise calling  
  for constitutional and electoral reform, President Balaguer assumed office  
  for an abbreviated term and Congress amended the Constitution to bar        
  presidential succession.                                                    
                                                                       
  Since 1996, the Dominican electoral process has been seen as generally free 
  and fair. In June 1996, Leonel Fernández Reyna of the Dominican Liberation  
  Party (PLD) was elected to a 4-year term as president. Fernández's political
  agenda was one of economic and judicial reform. He helped enhance Dominican 
  participation in hemispheric affairs, such as the OAS and the follow up to  
  the Miami Summit. On May 16, 2000, Hipólito Mejía, the PRD candidate, was   
  elected president in another free and fair election, soundly defeating PLD  
  candidate Danilo Medina and former president Balaguer. Mejía championed the 
  cause of free trade and Central American and Caribbean economic integration.
  The Dominican Republic signed a free trade agreement (CAFTA-DR) with the    
  United States and five Central American countries in August 2004, in the last
  weeks of the Mejía administration. During the Mejía administration, the     
  government sponsored and obtained anti-trafficking and anti-money-laundering
  legislation, sent troops to Iraq for Operation Iraqi Freedom, and ratified  
  the Article 98 agreement it had signed in 2002. Mejía faced mounting domestic
  problems as a deteriorating economy--caused in large part by the government's
  measures to deal with massive bank fraud--and constant power shortages      
  plagued the latter part of his administration.                              
                                                                       
  During the Mejía administration, the Constitution was amended to permit an  
  incumbent president to seek a second successive term, and Mejía ran for     
  re-election. On May 16, 2004, Leonel Fernández was elected president,       
  defeating Mejía 57.11% to 33.65%. Eduardo Estrella of the PRSC received 8.65%
  of the vote. Fernández took office on August 16, 2004, promising in his     
  inaugural speech to promote fiscal austerity, to fight corruption and to    
  support social concerns. Fernández said the Dominican Republic would support
  policies favoring international peace and security through multilateral     
  mechanisms in conformity with the United Nations and the OAS. The Fernández 
  administration has worked closely with the United States on law enforcement 
  and immigration and counter-terrorism matters. On May 16, 2006, President   
  Fernández's PLD won a majority of seats in the upper and lower houses of    
  Congress as well as a plurality of mayoral seats, marking a major shift in  
  power among the main political parties. Several candidates have begun       
  campaigning for the 2008 presidential elections. On March 25, 2007, President
  Fernández announced his intention to run.                                   
                                                                       
  GOVERNMENT AND POLITICAL CONDITIONS                                         
  The Dominican Republic is a representative democracy with national powers   
  divided among independent executive, legislative, and judicial branches. The
  president appoints the cabinet, executes laws passed by the legislative     
  branch, and is commander in chief of the armed forces. The president and vice
  president run for office on the same ticket and are elected by direct vote  
  for 4-year terms. Legislative power is exercised by a bicameral Congress--the
  Senate (32 members) and the House of Representatives (178 members).         
                                                                       
  The Dominican Republic has a multi-party political system with national     
  elections every 2 years (alternating between presidential elections and     
  congressional/municipal elections). Presidential elections are held in years
  evenly divisible by four. Congressional and municipal elections are held in 
  even numbered years not divisible by four. International observers have found
  that presidential and congressional elections since 1996 have been generally
  free and fair. Elections are supervised by a Central Elections Board (JCE) of
  9 members chosen for a four-year term by the newly elected Senate. JCE      
  decisions on electoral matters are final.                                   
                                                                       
  Under the constitutional reforms negotiated after the 1994 elections, the   
  16-member Supreme Court of Justice is appointed by a National Judicial      
  Council, which is comprised of the President, the leaders of both houses of 
  Congress, the President of the Supreme Court, and an opposition or          
  non-governing-party member. One other Supreme Court Justice acts as secretary
  of the Council, a non-voting position. The Supreme Court has sole authority 
  over managing the court system and in hearing actions against the president,
  designated members of his cabinet, and members of Congress when the         
  legislature is in session.                                                  
                                                                       
  The Supreme Court hears appeals from lower courts and chooses members of    
  lower courts. Each of the 31 provinces is headed by a presidentially        
  appointed governor. Mayors and municipal councils to administer the 124     
  municipal districts and the National District (Santo Domingo) are elected at
  the same time as congressional representatives.                             
                                                                       
  Principal Government Officials                                              
  President--Leonel Fernández Reyna                                           
  Foreign Minister--Carlos Morales Troncoso                                   
  Ambassador to the United States--Flavio Dario Espinal Jacobo                
  Ambassador to the United Nations--Erasmo Lara Peña                          
  Ambassador to the Organization of American States--Roberto Alvarez          
                                                                       
  The Dominican Republic maintains an embassy in the United States at 1715 22d
  Street NW, Washington, DC 20008 (tel. 202-332-6280).                        
                                                                       
  DEFENSE                                                                     
  Congress authorizes a combined military force of 44,000 active duty         
  personnel. Actual active duty strength is approximately 32,000. However,    
  approximately 50% of those are used for non-military activities such as     
  security providers for government-owned non-military facilities, highway toll
  stations, prisons, forestry work, state enterprises, and private businesses.
  The Commander in Chief of the military is the President. The principal      
  missions are to defend the nation and protect the territorial integrity of  
  the country. The army, larger than the other services combined with         
  approximately 20,000 active duty personnel, consists of six infantry        
  brigades, a combat support brigade, and a combat service support brigade. The
  air force operates two main bases, one in the southern region near Santo    
  Domingo and one in the northern region near Puerto Plata. The navy operates 
  two major naval bases, one in Santo Domingo and one in Las Calderas on the  
  southwestern coast, and maintains 12 operational vessels. In the Caribbean, 
  only Cuba has a larger military force.                                      
                                                                       
  The armed forces have organized a Specialized Airport Security Corps (CESA) 
  and a Specialized Port Security Corps (CESEP) to meet international security
  needs in these areas. The Secretary of the Armed Forces has also announced  
  plans to form a specialized border corps (CESEF). Additionally, the armed   
  forces provide 75% of personnel to the National Investigations Directorate  
  (DNI) and the Counter-Drug Directorate (DNCD).                              
                                                                       
  The Dominican National Police force contains 32,000 agents. The police are  
  not part of the Dominican armed forces, but share some overlapping security 
  functions. Sixty-three percent of the force serve in areas outside          
  traditional police functions, similar to the situation of their military    
  counterparts.                                                               
                                                                       
  ECONOMY                                                                     
  After a decade of little to no growth in the 1980s, the Dominican Republic's
  economy boomed in the 1990s, expanding at an average rate of 7.7% per year  
  from 1996 to 2000. Tourism (the leading foreign exchange earner),           
  telecommunications, and free-trade-zone manufacturing are the most important
  sectors, although agriculture is still a major part of the economy. The     
  Dominican Republic owed much of its success to the adoption of sound        
  macroeconomic policies in the early 1990s and greater opening to foreign    
  investment. Growth turned negative in 2003 (-0.4%) due to the effects of    
  government handling of major bank frauds and to lower U.S. demand for       
  Dominican manufacturers. The Mejía administration negotiated an IMF standby 
  agreement in August 2003 but was unable to comply with fiscal targets. The  
  Fernández administration obtained required tax legislation and IMF board    
  approval for the standby in January 2005. The Dominican peso fell to an     
  unprecedented low in exchange markets in 2003-2004 but strengthened         
  dramatically following the election and inauguration of Leonel Fernández.   
  Since late 2004 it has traded at a rate considered to be overvalued on a    
  purchasing power parity basis. Inflation fell sharply in late 2004 and was  
  estimated at 9% for that calendar year. The Fernández administration        
  successfully renegotiated official bilateral debt with Paris Club member    
  governments, commercial bank debt with London Club members, and sovereign   
  debt with a consortium of lenders. It met fiscal and financial targets of the
  standby agreement but fell short of goals for reforms in the electricity    
  sector and financial markets. Central Bank statistics indicate 9.3% growth  
  for 2005 with 7.44% inflation. The Central Bank estimates that economic     
  growth for 2006 will surpass 11%, with inflation of about 5%.               
                                                                       
  The Dominican Republic's most important trading partner is the United States
  (75% of export revenues). Other markets include Canada, Western Europe, and 
  Japan. The country exports free-trade-zone manufactured products (garments, 
  medical devices, etc.), nickel, sugar, coffee, cacao, and tobacco. It imports
  petroleum, industrial raw materials, capital goods, and foodstuffs. On      
  September 5, 2005, the Dominican Congress ratified a Free Trade Agreement   
  with the U.S. and five Central American countries, known as CAFTA-DR. The   
  CAFTA-DR agreement entered into force for the Dominican Republic on March 1,
  2007. The stock of U.S. foreign direct investment (FDI) in Dominican Republic
  in 2005 was U.S. $758 million, down from U.S. $1.1 billion in 2004, much of 
  it directed to the tourism sector, to free trade zones, and to the          
  telecommunications sector. Remittances were close to $2.5 billion in 2005.  
                                                                       
  An important aspect of the Dominican economy is the Free Trade Zone industry
  (FTZ), which made up U.S. $4.75 billion in Dominican exports for 2005 (77% of
  total exports). In 2006, however, reports show that the FTZs lost 41,000 jobs
  and suffered a 5% decrease in total exports. The textiles sector experienced
  an approximate 17% drop in exports due in part to the appreciation of the   
  Dominican peso against the dollar, Asian competition following expiration of
  the quotas of the Multi-Fiber Arrangement, and a government-mandated increase
  in salaries, which should have occurred in 2005 but was postponed to January
  2006. Lost Dominican business was captured by firms in Central America and  
  China. The tobacco, jewelry, medical, and pharmaceutical sectors in the FTZs
  all reported increases for 2006, which somewhat offset textile and garment  
  losses. Industry experts from the FTZs expect that entry into force of the  
  CAFTA-DR agreement will promote substantial growth in the FTZ sector for    
  2007.                                                                       
                                                                       
  An ongoing concern in the Dominican Republic is the inability of participants
  in the electricity sector to establish financial viability for the system.  
  Three regional electricity distribution systems were privatized in 1998 via 
  sale of 50% of shares to foreign operators; the Mejía administration        
  repurchased all foreign-owned shares in two of these systems in late 2003.  
  The third, serving the eastern provinces, is operated by U.S. concerns and is
  50% U.S.-owned. The World Bank records that electricity distribution losses 
  for 2005 totaled about 38.2%, a rate of losses exceeded in only three other 
  countries. Industry experts estimate distribution losses for 2006 will      
  surpass 40%, primarily due to low collection rates, theft, and corruption. At
  the close of 2006, the government had exceeded its budget for electricity   
  subsidies, spending close to U.S. $650 million. The government plans to     
  continue providing subsidies. Congress plans to pass a law in early 2007 that
  criminalizes the act of stealing electricity. The electricity sector is a   
  highly politicized sector and with 2008 presidential election campaigning   
  already in motion, the prospect of further effective reforms of the         
  electricity sector is poor. Debts in the sector, including government debt, 
  amount to more than U.S. $500 million. Some generating companies are        
  undercapitalized and at times unable to purchase adequate fuel supplies.    
                                                                       
  FOREIGN RELATIONS                                                           
  The Dominican Republic has a close relationship with the United States and  
  with the other states of the inter-American system. It has accredited       
  diplomatic missions in most Western Hemisphere countries and in principal   
  European capitals. Newly elected president of Haiti René Préval made a      
  working visit to Santo Domingo in March 2006, reciprocating Leonel          
  Fernández's call on the Interim Government of Haiti in December 2005. The   
  Dominican Government has regularly appealed for international support for its
  island neighbor.                                                            
                                                                       
  There is a sizeable Haitian migrant community in the Dominican Republic, many
  of whom lack residence permits and citizenship documentation. The Dominican 
  Republic belongs to the United Nations and many of its specialized and      
  related agencies, including the World Bank, International Labor Organization,
  International Atomic Energy Agency, and International Civil Aviation        
  Organization. It is a member of the OAS and of the Inter-American Development
  Bank.                  &