LATIN AMERICA SPECIAL — Economy gathers strength in the

The economy of the Dominican Republic improved markedly in 1991-92, reports the International Monetary Fund (IMF).

Real gross domestic product grew by an estimated 6% in 1992 whereas inflation was

estimated to be 6% (partly because of an increase in value-added tax), up from 4% the previous year.

The country, which shares the island of Hispaniola with Haiti, has been blessed with rich mineral deposits, in particular ferronickel, gold and silver. In addition to its mineral wealth, the country has an agricultural base and is benefiting from a surge in tourism.

The IMF credits Dominican authorities with achieving many of the objectives of an economic program under which they have been working. “Inflation has been reduced markedly, economic activity has recovered and the international reserve position has been strengthened,” writes the IMF in a recent issue of its Survey publication.

“However, significant challenges lie ahead. The Dominican economy remains vulnerable to external shocks, the structure of public finances needs to be strengthened further, and interest rates remain high in real terms.”