Dominican Republic

Dominican Republic makes inroads on infrastructure but lots of ground remains to be covered

Bnamericas Published: Monday, January 09, 2023
Dominican Republic makes inroads on infrastructure but lots of ground remains to be covered

BNamericas speaks to Ramón Pepín, who was Dominican public works minister in the government of ex-president Danilo Medina, about the infrastructure sector in the Caribbean nation and the issues that he believes still need work.

In particular, he pointed to the challenges of developing the country's public infrastructure, such as airports and hospitals, and improving mobility and travel times. However, he also underlined that he was pleased that President Luis Abinader's administration has continued the projects that were inherited in the portfolio from the previous government, though it has yet to propose its own initiatives.

BNamericas: How would you rate the infrastructure sector in the Dominican Republic?

Pepín: In 2019, a global competitiveness study was done where 144 countries were evaluated in terms of road infrastructure quality and, at that time, the Dominican Republic was ranked 40th worldwide. 

With respect to Latin America, it was ranked third, and at the level of the Caribbean and Central America, it was first. In other words, the quality of Dominican road infrastructure was among the best in Latin America. 

That same study was carried out in 2002 and we were ranked 62nd on the road infrastructure indicator. That is to say, from 2002 to 2019 the country advanced and went up 22 places. That speaks very well of the progress in terms of infrastructure in the Dominican Republic. 

In our country, we have a surplus of connectivity at all points. You can get to a province, town, district and you have different alternatives to get there, different roads, which isn't like other countries where you can only move from one point to another on one or two roads. 

BNamericas: What factors have contributed to this progress?

Pepín: The last government of the Dominican Liberation Party was focused on tourism. So, for the country to advance in terms of serving the tourism sector, it necessarily had to build good roads and highways. I believe that having that as the main focus prompted the government to see the need to develop a comprehensive road construction and repair plan with adequate maintenance. We hope that this government continues in that direction.

BNamericas: What about other types of infrastructure?

Pepín: As a country we have lots of challenges, including developing the country's public infrastructure. Here some of the airports are operated under the PPP [public-private partnership] model, but we also have airports that are managed by the state, and the country has a privileged position in that sense too. 

It's also essential to promote the development of the hospital sector. In the past, the government had a program to rehabilitate 56 hospitals. Great progress has been made, and we have to continue developing all of this infrastructure for the country to continue moving forward.

BNamericas: Which of the various subsectors presents the most challenges for the country?

Pepín: We have come a long way, but if you ask me, the most important challenge facing the Dominican Republic at the moment is the issue of mobility and transportation. We're reaching a point where they are becoming one of the country's main problems because mobility greatly affects the country's competitiveness, that is, moving from one place to another relatively rapidly. 

It's becoming a big headache and a big problem with the economic burden of traffic gridlock. You have to think about much more efficient mobility and transport that is much more friendly to the environment. A short time ago, I think in 2015, PIARC [the world road association] determined that every day 200mn euros were lost purely due to traffic jams, so it's a real problem. There are countries in which the losses represent close to 1.5% of the GDP of that country.

BNamericasSpeaking specifically about projects, which ones do you think the country needs to build in the short term?

Pepín: The main problem is mobility and transport, reducing the transportation time of our goods. The country's main ports are in the southern part of the island, but the most important means of production are in the north, so we have to work to reduce the travel time of goods produced in that region. 

We need to build the necessary infrastructure so that goods don't have to travel practically across the entire island to be imported or exported to another country. We also have to work, and the construction of five large bus terminals began under the last government to prevent interurban traffic from entering Santo Domingo and causing traffic jams. 

We have to seek for alternatives so that heavy vehicles can enter the city to drop off their merchandise at night, at specific times, creating some time incentive so that companies can receive raw materials and merchandise at night.

BNamericas: What is the status of those bus terminal projects?

Pepín: The program contemplated five large terminals on the outskirts of Santo Domingo and one of them has been completed. The rest are in the construction phase because they're large and multimodal, that is, different transport systems will coverge: buses, metro and cable cars. About 70,000 vehicles enter Santo Domingo each day, and of those that enter or pass through, about 12,000 are buses. With these terminals, the buses would stay on the outskirts of the city, connecting urban transport services with interurban services.

BNamericas: Of the projects that are underway, which ones do you think are the most important to help meet the goals of the infrastructure sector?

Pepín: In this sense, the most important projects that are currently being built include the extension of the second metro line, as well as a series of ring roads in various cities in the interior of the country that will greatly speed up mobility, and important roads for the development of the country. 

In the portfolio we have a series of projects that have to be carried out, such as the rail line from Santo Domingo to Santiago. I would say that it shouldn't just run to Santiago but should also reach Manzanillo port or Puerto Plata.

BNamericas: Do you think the current government is doing a good job on this issue?

Pepín: We have seen that the current government management has continued the projects that they had in the pipeline or under execution. We're still waiting for the initiatives that are specific to this government, but we're pleased and supportive that they have continued with the portfolio of programs, such as the expansion of line No. 2 of the Santo Domingo metro, the construction of a new cable car line, the construction of bus terminals and the ring roads, the ecological avenue, the elevated Boca Chica pier, and very important programs such as the construction of parking lots in Santo Domingo to help mobility, so people can park their vehicles in safe places. 

BNamericas: Does the change of the governing party undermine the country's appeal to foreign capital?

Pepín: Our country has always been open to foreign investment because it's a very important pillar for development. For example, in the case of tourism we have large investments from Europe, Canada and Spain, and right now Venezuela is investing a lot in the tourism sector. The Dominican Republic has always had a favorable environment and an appropriate legal framework for foreign investment. I believe that it's opportune for any person or company that wants to invest and they can do so with complete confidence because the country offers true legal security.

BNamericaWhat are the country's other competitive advantages, apart from its road infrastructure?

Pepín: The geography, the position of the Dominican Republic on the world map. This can be very useful for foreign companies, which can produce their products here and be two hours from Miami and a short distance from Europe.

BNamericas: What are the pending issues?

Pepín: We have to continue reducing the times in which a company can establish itself in the Dominican Republic, those are the opportunities we have to improve, to continue strengthening the institutional framework.

BNamericas: You mean the processing times?

Pepín: Correct. In recent years they have been reduced a lot, but there's room for improvement.

BNamericas: What would you recommend to investors or companies that want to establish themselves in the Dominican Republic?

Pepín: The first thing is that they shouldn't be afraid. They have to trust the country. The Dominican Republic is a democratic country where the institutions are respected, which is committed to legal security and which has dedicated human capital. The best asset the country has is its people.

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