The Dominican Republic: Economic Perspectives for Next Decade

Transcripción

1 The Dominican Republic: Economic Perspectives for Next Decade Presentation by: Lic. Frederic Emam-Zadé Gerardino Director of Economic Development Fundación Global Democracia y Desarrollo At the Conference: Dominican-American Relations: Building Bridges for Development Sponsored by: The Center on Globalization and Sustainable Development at the Earth Institute The Institute of Latin American Studies at Columbia University The Global Foundation for Democracy and Development At Columbia University, New York, October 13, 2003 Total o partial reproduction of this material is permitted, only if credit is given to its author.

2 Objectives of this analysis Analyze the Comparative Advantages Of the 15 sectors of the national production Of the 35 nations of America Analyze DR s Growth Engines During the last 10 years During the last 20 years Predict trends of these Engines

3 Part I: Comparative Advantages

4 Criteria of this analysis Comparative Advantage Theory It will be more profitable for us to sell our less costly goods to another country and to buy from them its less costly goods; maximizing the profits of both Revealed Comparative Advantage Indicates the contribution of each sector to the general balance of trade of the nation Trade Performance Reflects the competitiveness and diversification of one export sector, in comparison to other nations

5 Revealed Comparative Advantage The Revealed Comparative Advantage (RCA) according to the CEPII* formula shows the contribution of each sector to the country's overall trade balance. The higher the Index or the better (lower) the ranking, the larger is the contribution of the sector to net exports (exports minus imports) and the balance of trade. The Index indicates the difference between actual net exports and the adjusted net exports taking into account the country's overall trade surplus/deficit. (*) : Centre d études prospectives et d informations internationales, Paris.

6 The formula

7 The 15 sectors analyzed Fresh food Processed food Wood products Textiles Chemicals Leather products Basic manufactures Non-electrical machinery Electronic products Electronic components Transport equipment Clothing Misc. Manufactures Minerals Services

8 Miscelaneous manufacturing DOMINICANA HONDURAS DR (1) ST. VINCENT&G USA DOMINICA US BOLIVIA ANTIGUA&B EL SALVADOR BAHAMAS GUATEMALA NICARAGUA SURINAM GRENADA The DR is much more competitive than the US and by far the most competitive exporter of Miscellaneous Manufactures BARBADOS HAITI MEXICO COSTA RICA BRAZIL PANAMA TRINIDAD&T ST. LUCIA GUYANA Most of the hemisphere is not competitive exporting Miscellaneous Manufactures PERU URUGUAY CANADA CHILE COLOMBIA CUBA JAMAICA ST. KITTS&N ECUADOR ARGENTINA BELICE VENEZUELA PARAGUAY

9 Clothing HAITI DOMINICANA JAMAICA DR (2) PERU BELICE EL SALVADOR COLOMBIA URUGUAY COSTA RICA ST. LUCIA BOLIVIA The DR is a very competitive exporter of Clothing, second to Haiti ST. KITTS&N GUATEMALA NICARAGUA GUYANA PARAGUAY GRENADA HONDURAS ANTIGUA&B BRAZIL PANAMA TRINIDAD&T Most of the hemisphere is not very competitive and non-competitive exporting clothing, the US being the least competitive BAHAMAS BARBADOS DOMINICA ECUADOR ST. VINCENT&G SURINAM CANADA CUBA ARGENTINA CHILE VENEZUELA US MEXICO USA

10 Textiles EL SALVADOR GUATEMALA NICARAGUA PERU ANTIGUA&B BRAZIL HAITI ST. LUCIA URUGUAY USA BAHAMAS BOLIVIA PARAGUAY ST. VINCENT&G SURINAM BARBADOS ST. KITTS&N BELICE US The US is rather neutral, but more competitive than the DR and others in exporting Textiles Most of the hemisphere is not competitive exporting Textiles, the DR being one of the least CANADA GRENADA HONDURAS PANAMA CUBA ARGENTINA ECUADOR VENEZUELA COLOMBIA COSTA RICA GUYANA MEXICO TRINIDAD&T DR (34) CHILE JAMAICA DOMINICANA DOMINICA

11 Leather products URUGUAY DOM INICANA BRAZIL DR (2) PARAGUAY ARGENTINA BOLIVIA HAITI ANTIGUA&B COLOMBIA EL SALVADOR GRENADA DOM INICA The DR is more competitive than the US and the second most competitive exporter of Leather Goods GUATEMALA NICARAGUA COSTA RICA MEXICO ST. KITTS&N BAHAMAS JAMAICA ST. VINCENT&G SURINAM HONDURAS PANAMA PERU TRINIDAD&T BARBADOS BELICE Most of the hemisphere is poorly or not competitive exporting Leather Goods, and the US is the least competitive CANADA ECUADOR ST. LUCIA CUBA GUYANA VENEZUELA US CHILE USA

12 E l ectronic components ST. KITTS&N GRENADA BARBADOS USA DOMINICANA ST. LUCIA ANTIGUA&B EL SALVADOR SURINAM BAHAMAS HAITI GUYANA HONDURAS GUATEMALA NICARAGUA JAMAICA PANAMA ST. VINCENT&G BELICE US DR (5) The US is just a barely more competitive than the DR exporting Electronic Components BOLIVIA MEXICO COLOMBIA ECUADOR Most of the hemisphere is not competitive exporting Electronic Components TRINIDAD&T PERU PARAGUAY CUBA CHILE URUGUAY VENEZUELA ARGENTINA CANADA DOMINICA BRAZIL COSTA RICA

13 Consumer electronics ectronics COSTA RICA MEXICO BAHAMAS ANTIGUA&B SURINAM ST. VINCENT&G HAITI GRENADA US DR (14) ST. LUCIA USA BARBADOS CUBA GUYANA DOMINICANA HONDURAS Both the US and the DR are not competitive exporting Consumer Electronics, but the US ranks slightly higher than the DR ST. KITTS&N CANADA JAMAICA PANAMA DOMINICA BELICE TRINIDAD&T Most of the hemisphere is not competitive exporting Consumer Electronics ECUADOR BOLIVIA BRAZIL EL SALVADOR GUATEMALA NICARAGUA URUGUAY VENEZUELA PERU PARAGUAY COLOMBIA CHILE ARGENTINA

14 Basic manufacturing CHILE PERU BRAZIL BARBADOS TRINIDAD&T ANTIGUA&B CANADA EL SALVADOR BAHAMAS US DR (15) BOLIVIA JAMAICA USA VENEZUELA COLOMBIA DOMINICANA SURINAM Both the US and the DR are not competitive exporting Basic Manufactures, but the US ranks slightly higher than the DR ARGENTINA GUATEMALA NICARAGUA PANAMA HAITI URUGUAY Most of the hemisphere is not competitive exporting Basic Manufactures MEXICO PARAGUAY HONDURAS ST. LUCIA COSTA RICA ST. VINCENT&G BELICE DOMINICA GRENADA ECUADOR GUYANA CUBA ST. KITTS&N

15 Non-el ectric machi nery The US is the hemisphere s most competitive exporter of Non-electric Machinery, ranking much higher than the DR USA ST. KITTS&N ANTIGUA&B SURINAM BAHAMAS ST. LUCIA GRENADA HAITI DOMINICA BARBADOS PANAMA EL SALVADOR MEXICO PARAGUAY JAMAICA US Most nations are highly non-competitive exporting Non-electric Machinery DR (17) URUGUAY DOMINICANA ST. VINCENT&G CANADA HONDURAS BRAZIL BELICE COSTA RICA GUATEMALA NICARAGUA BOLIVIA COLOMBIA ARGENTINA ECUADOR TRINIDAD&T PERU CUBA CHILE VENEZUELA GUYANA

16 Chemicals The US is one of the hemisphere s most competitive exporters of Chemicals, ranking much higher than DR TRINIDAD&T DOMINICA BAHAMAS USA BARBADOS ANTIGUA&B US EL SALVADOR SURINAM CANADA GUATEMALA NICARAGUA PANAMA GRENADA ST. LUCIA Most of the hemisphere is highly noncompetitive exporting Chemicals DR (17) ST. VINCENT&G HAITI DOMINICANA MEXICO HONDURAS JAMAICA CHILE CUBA ST. KITTS&N VENEZUELA BELICE PARAGUAY URUGUAY ARGENTINA GUYANA BRAZIL COSTA RICA PERU BOLIVIA COLOMBIA ECUADOR

17 Transport equipment The US is a slightly competitive exporter of Transport Equipment, but ranks much higher than the DR ST. VINCENT&G CANADA MEXICO BRAZIL USA ANTIGUA&B US URUGUAY SURINAM ST. LUCIA BARBADOS ECUADOR HONDURAS EL SALVADOR ARGENTINA BOLIVIA DOM INICA HAITI Most nations are non-competitive exporting Transport Equipment COSTA RICA CUBA GRENADA ST. KITTS&N BELICE PANAMA PERU DR (26) COLOMBIA DOMINICANA JAMAICA VENEZUELA GUYANA PARAGUAY TRINIDAD&T GUATEMALA NICARAGUA CHILE BAHAMAS

18 Processed food CUBA GUYANA BELICE ARGENTINA BAHAM AS URUGUAY BARBADOS ST. KITTS&N BOLIVIA BRAZIL PERU CHILE GUATEMALA NICARAGUA Most nations of the hemisphere are very competitive exporting Processed Foods DOMINICA PARAGUAY ECUADOR EL SALVADOR COSTA RICA ANTIGUA&B JAMAICA PANAMA USA CANADA US MEXICO DR (27) SURINAM DOMINICANA TRINIDAD&T HONDURAS COLOMBIA ST. VINCENT&G GRENADA ST. LUCIA The US is slightly competitive in Processed Foods, and ranks higher than the DR, which is slightly non-competitive VENEZUELA HAITI

19 Fresh food PARAGUAY ECUADOR GUATEMALA NICARAGUA ST. LUCIA HONDURAS PANAMA GRENADA ST. VINCENT&G URUGUAY BELICE DOMINICA ARGENTINA COSTA RICA EL SALVADOR CHILE BRAZIL Most nations of the hemisphere are very competitive exporting Fresh Foods BAHAMAS BOLIVIA SURINAM PERU GUYANA JAMAICA CUBA USA CANADA US DR (30) HAITI ANTIGUA&B MEXICO DOMINICANA BARBADOS TRINIDAD&T VENEZUELA ST. KITTS&N COLOMBIA The US is slightly competitive in Fresh Foods, and ranks higher than the DR, which is slightly non-competitive

20 Minerals VENEZUELA COLOMBIA TRINIDAD&T JAMAICA ECUADOR BOLIVIA GUYANA CUBA ARGENTINA PERU Half of the nations of the hemisphere are competitive exporting Minerals, while the other half is not SURINAM CANADA CHILE MEXICO BAHAMAS DOMINICA ANTIGUA&B BARBADOS PANAMA HAITI BRAZIL ST. LUCIA EL SALVADOR US GUATEMALA HONDURAS NICARAGUA COSTA RICA USA GRENADA The US is slightly non-competitive in Minerals, and ranks slightly higher than the DR, which is non-competitive PARAGUAY DR (32) ST. KITTS&N DOMINICANA URUGUAY BELICE ST. VINCENT&G

21 Wood products CANADA CHILE GUYANA BRAZIL PARAGUAY HONDURAS BOLIVIA EL SALVADOR Few nations of the hemisphere are very competitive exporting Wood Products, most are not ST. LUCIA ANTIGUA&B US SURINAM USA URUGUAY PANAMA BARBADOS ECUADOR MEXICO GUATEMALA NICARAGUA PERU TRINIDAD&T COLOMBIA BAHAMAS HAITI BELICE The US is slightly non-competitive in Wood Products, but ranks higher than the DR, which is highly non-competitive CUBA ARGENTINA GRENADA DOMINICA VENEZUELA ST. VINCENT&G DR (33) COSTA RICA DOMINICANA JAMAICA ST. KITTS&N

22 Services Dom. Rep. DR (1) Guatemala Uruguay Costa Rica United States El Salvador US Chile Peru Ecuador Colombia Brazil Canada The DR is the most competitive services exporter of the hemisphere (mainly tourism), and slightly more competitive but less diversified than the US Argentina Mexico Half of the hemisphere is competitive exporting Services Venezuela

23 RANKING Top 50% Low 50% Revealed advantages of the D.R. Consumer Electronics (14) Services (1) Basic manufacturing (15) Misc. manufacturing (1) Non-electric machinery (17) Clothing (2) Chemicals (17) Leather products (2) Electronic components (5) Transport equipment (26) Processed food (27) Fresh food (30) Minerals (32) Wood products (33) Textiles (34) Minimum COMPETITIVENESS Maximum

24 Revealed advantages of the U.S. RANKING Top 50% Textiles (10) Consumer Electronics (10) Basic manufacturing (12) Wood products (12) Minerals (28) Clothing (35) Leather products (35) Non-electric machinery (1) Misc. manufacturing (4) Electronic components (4) Chemicals (4) Transport equipment (5) Services (5) Processed food (23) Fresh food (25) Low 50% Minimum COMPETITIVENESS Maximum

25 Services (1) Misc. manufacuring (1) TRADE TRENDS Non-electric machinery (1) Misc. manufacuring (4) Clothing (2) Electronic components (4) Leather products (2) Chemicals (4) Electronic components (5) Transport equipment (5) Consumer Electronics (14) Services (5) Basic manufacturing (15) Processed food (23) Non-electric machinery (17) Fresh food (25) Chemicals (17) Textiles (10) Transport equipment (26) Consumer Electronics (10) Processed food (27) Basic manufacturing (12) Fresh food (30) Wood products (12) Minerals (32) Minerals (28) Wood products (33) Clothing (35) Textiles (34) Leather products (35)

26 Part II: Dominican Growth Engines

27 The 10 Champions of the DR (Highest average annual growth rates during the last 20 years -4% -2% 0% 2% 4% 6% 8% 10% 12% 14% 16% Comunicaciones Hoteles, Bares y Rest. Zonas Francas 13% 13% 14% Construcción 8% Finanzas Ele ctricidad 7% 7% Transporte Manufactura (-ZF,-Az) Comercio Otros Servicios 4% 4% 4% 3% Agropecuaría 2% Propiedad de Viviendas 2% Minería 1% -2% Azucar

28 The Champions of the 90 s Highest growth rates* Communication 16% Hotels, Rest. 12% Construction 11% Electricity 10% Transport 7% Commerce 6% Manufacture 5% Most value generated** Manufacture 20% Construction 17% Commerce 15% Hotels, Rest. 12% Communicatión 10% Agriculture 7% Transport 7% * Average annual growth rate ** Value generated in the decade

29 Engines of Value (value generated annually during , by sector) 140, , ,000 80,000 60,000 Production of Services Commerce Hotels and restaurants Transport Communication Financial services Housing Public Administration Other services Secondary Production Manufacture (all) Electricity and water Construction 40,000 20,000 Primary Production Agropecuary Forestry and Fishing Mining

30 Prediction: Engines of value of the next decade Last 20 years trend 2002: Employs 63% Production of Services Last 10 years trend Production of Services Secondary Production Secondary Production 2002: Employs 21% 2002: Employs 16% Primary Production Primary Production

31 The 10 principal Engines (value generated annually during , by subsector 40,000 35,000 Manufactura (-ZF,-Az) Comercio 30,000 25,000 20,000 15,000 10,000 Agropecuaría Construcción Otros Servicios Comunicaciones Hoteles, Bares y Rest. Propiedad de Viviendas 5,000 Transporte Zonas Francas millions of pesos at 1991 prices

32 Comunicación Agropecuaria Transporte Propiedad de viviendas Zonas Francas Prediction: 10 Engines for the next decade Last 20 years trend Last 10 years trend Hoteles, rest., etc. Manufactura Comunicación Manufactura Construcción Comercio Agropecuaria Construcción Comercio Hoteles, restaurantes, etc Otros servicios Otros servicios Transporte Propiedad de viviendas Zonas Francas