they sound like obama???

Just how can the DR achieve this small growth even though it is much much less than the DR government forecasts last month of 3 % growth in GDP.If the IMF says commodity prices will fall, remittances will fall, tourism will fall and if the current account is in deficit , which I am sure it will be, the only components that can give positive growth are increased spending by the population and by the government. I can not see that , with so many people losing their jobs, there can be an increase in general consumer spending ..actually most people are tightening their belts ..so it must be that the government is about to do major construction work in the next two years .
I can only assume the IMF is relying on DR government figures..
I think it will take many years for the development industry here to get back to normal so land sales and housing sales are not likely to lead the recovery.

Ricardo,
Yes, the Gov must have some more construction projects planned. I don't see people sending more money back to DR, and tourism does not look like it will grow, unless DR has tapped into a new market for tourists.

New trains, highways, shools, hospitals, universities, public housing, and now that import of used clothing is banned textiles too. Agriculture will grow as the country goes for self sufficiency will grow fast - my friends are all planting tomatoes. Also solar power. Tourism is prospering too as more breaks are available to workers in Europe.
S.

Where is Dread ? when you need him .

Ricardolito not sure why falling commodity prices would reduce remittances, could you expand on that?

I believe the global recession has not hit the DR that hard yet in all sectors because people are being fooled by the shuffling of the numbers and money. All these loans will eventually need to be paid and the interest keeps climbing. Just like in the US once credit tightens and there is no more loans the DR will feel the heat just like everyone else is.

Foreign investers have less money to spend this year and even those who have extra money are tightening up spending not knowing what to expect in the next year or two.

There always were a lot of people struggling to keep above water and put a little money away for a rainy day. Well it's started raining and more people are falling behind than ever.

My family's colmado has more than twice as many people with large credit bills for food this year. We understand times are tough and don't want to turn people away or have them starve but we cannot buy more food to sell if these bills are not paid to us either.

The two are not connected and I was merely quoting all the negatives from the press release ..the DR government has already confirmed that remittances have fallen . The second paragraph of the press release is not written well but I assume it means that unprocessed exports such as sugar, fruit and other food items as well as mining products have fallen in unit value . Actually gold has risen sharply but I understand the reopened mines are not yet producing much.
i do not understand much that abc200 wrote as there are no new trains for the next two years ,the IMF and the DR have both said that tourism will be down but maybe abc200 is correct in that there will be a tomato led recovery

Thanks for the clarification Ricardo, I thought you had suggested a direct relationship between the two and could not figure it out.

Making predictions today is a crap shoot. I consider myself very well read on this crisis, but can't offer much to the world of chicken littles or the super bulls. None of the usual principles seem to apply right now. For example many simpletons bark and bray about inflation because this is the one financial principle they understand; print money, prices increase. However as usual in finance few things are truly causal. There is a steadily growing pile of money sitting on bank balance sheets or personal savings accounts but too few are willing to lend or spend so here we are...

Manhattan,
The question is, who will take the first step and start spending again?

Manhattanite, actually the global crisis is not too difficult to figure out ..the worlds biggest consuming country is the USA , the worlds biggest producer is china and so we have to await for the USA propensity to consume ( as it is called in economic books) to increase and then china will produce more and will need the raw materials, such as steel,coal. wool,cotton etc from many other countries and then then the other countries gradually fall into line again.in the small regional economies, I believe there will be a lag before these countries improve. Here in the DR, we rely on tourism, the export of fairly basic items such as food stuffs and raw materials and also we rely on foreign investment into the country that will bring jobs and money to the Dominicans. I live in la Romana, which is relatively prosperous thanks to the foreign money in Casa de Campo and similar resorts.

The Dominican government must encourage foreigners, at the top level, to settle and invest in this country so that the economy can expand. I often quote the former third world countries in Asia as great examples and I can see why the economy can not be similarly turned around in the DR...Yes there are all the problems with government corruption but on the other hand I believe that the ports and customs have improved so that is a start. i hope that the promises to make residency more easily obtainable will soon be carried through.

They made a mistake. The Dominican economy will grow 4.5% in 2009 not 0.5%

Dr. Dread,

Where are you? This is your established area of expertise and we need your incisive input and wisdom in the discussion, before we all follow abc's suggestion to fix the economy by planting tomatoes. ABC, if allowed, would just as soon turn DR into a giant commune and, if you were to expand that term, then we will have communism-and we all have a good idea about how great that system works.

Spagetti doesn't grow on trees
http://www.youtube.com/watch?v=SyUvNnmFtgI
You have to import wheat to make it. This costs valuable foreign exchange.
For the economy to thrive more bamboo for houses , trees for breadfruit, and forest nuts and other foods must be planted. Just coconut trees is a waste.
http://www.fao.org/DOCREP/u2440E/u2440e04.htm
Export prices of coconut products are not good.
Roads can be built with bridges made from bamboo - this way there is no import of steel.
http://viterbi.usc.edu/news/news/2008/astani-department-professor.htm
Recycling is of prime concern also to reduce imports. Ten year old cars can be brought up to date, refubished and sold or leased.
S.

ABC200,
There are enough clunkers in DR. We need to keep importing newer vehicles. New cars are better on fuel and are less harmfull to the air.

Perhaps they could make a list of 3 diesel cars and import just these. Also import diesel engines to remove the clunkiness of old cars. There is a 30 year old VW Beetle parked nearby. It doesn't sound clunky.
S.

abc,
most people are using propane due to the lower price per gallon

This is cheating the government out of tax - as this fuel is intended for cooking. Perhaps the government could make a spectial weekly charge on these cars.
S.

The world economy is based on trust that money thats is loaned gets pay back with interest so i believe this is the right approach even though is may not sound to good. If in 2 yrs thing don't turn around which many ecnomist believe it will then at least we will better than we are today. Some things are better off if keep away from the general public to keep the peace for all. Nothing in this planet is guarantee to be there next year we always hope it will tought

iTS growing ,growing , growing until its gone ..............because by 2012 , the Leonel puppet will have sold it all anyway....

abc,
propane is better for the enviroment, it burns cleaner

Ricardo agree re: USA starting to spend. This is exactly why it doesn't matter how much money the Fed and gov churn out the real question is when those funds will move out of bank balance sheets and consumer savings accounts .... and back into goods and services. As to what will start this is where I'm not able to make predictions. I did hear recently though that trucking capacity usage was up last month, and that this is often a leading indicator things are churning again.