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Santo Domingo.- Inter-American Businesses Association (Asine) president Leonel Castellanos on Monday said the Dominican Republic must reformulate its foreign trade policy in the heels of what he calls unfavorable results from the free trade agreements inked with other Central American and Caribbean nations.

He supports the positon by the Haina Industries and Companies Association, which opposes entering into more free trade pacts until the country reviews those it already signed.

Castellanos, interviewed by newspaper Hoy, said Dominican Republic’s trade balance is still unfavorable because the country lacks a foreign trade policy that promotes exports and makes productive sectors competitive compared with its rivals, despite similar economies.

He said it’s a "shame" the country has a trade deficit with other nations despite having posted the highest economic growth in the Latin American region. "That forces us to examine ourselves within."

Among the factors he says make the country uncompetitive the business leader listed  problems of transport, a failed electricity service, expensive fuels, obsolete Labor Code and the lack of regulation to verify the quality of products entering the country.

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2 comment(s)
Written by: chillinout, 16 Feb 2016 12:17 PM
From: Dominican Republic
It is assumed there is trade problem when companies have to operate in Free Trade Zones to be competitive in a country with almost free labor.

In order to induce development the gov't offers developers to be exempt from many things including:

1. Income tax for ten years
2. National and municipal taxes
3. Taxes on construction, plans, etc.
4. Taxes on the payment of loan interest
5. Reinvestment tax of 20 percent (tax savings on another
existing company, for five years)
6. Equipment import (exempt from customs taxes, taxes on
transfer of industrial goods and services)
7. The tax on luxury housing

Basically Free Trade Zone benefits for condo and hotel projects.

So without eliminating the normal regs and taxes the govt must think policies are so punitive they are noncompetitive.
Written by: bernies, 16 Feb 2016 5:10 PM
From: Dominican Republic, Juan Dolio
Hey Chillinout, what you just proposed is some sort of another tax reform and all the last tax reform that we have have only affect the end consumers. For example if the does what you proposed then the ITIBIS will be increase from 18 to 21% in which it will only more those less fortunate ones because they will get less at the supermarket for their pesos.
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