flag Dominican Republic Dominican Republic: Investing

FDI in Figures

The Dominican Republic is among the main recipients of FDI in the Caribbean and Central America. Foreign investment significantly influences the economy: FDI flows represent 3.7% of GDP, 63% of goods exports, and contribute to 30% of tax revenues. According to UNCTAD's World Investment Report 2023, FDI inflows to the country reached USD 4 billion in 2022 (+25.5% y-o-y). At the end of the same period, the stock of FDI amounted to USD 51.9 billion, representing around 46.1% of GDP. Data from Prodominicana show that FDI inflows amounted to USD 4.390 billion in 2023 (3.7% of GDP). This growth was largely attributed to the tourism and energy sectors. As per the latest figures released by the Central Bank, cumulative investment from 2010 to 2023 totals USD 39.6 billion, with the United States contributing 26.8% (USD 10.6 billion), followed by Canada at 14.4% (USD 5.7 billion), Spain at 7.8% (USD 3.1 billion), and Mexico at 7.3% (USD 2.9 billion). France ranks 7th, providing USD 854 million, equivalent to 2.2% of the total investment. Traditionally, the tourism, real estate, telecommunications, free trade zones, mining, and finance sectors have been the primary recipients of FDI. As per the Central Bank, there are 659 companies in the Dominican Republic with at least 10% foreign capital, comprising 414 within free trade zones and 245 outside these zones. These entities constitute 0.7% of all companies in the DR. Typically, these are sizable enterprises, with 40% employing over 150 individuals, whereas 75% of Dominican companies have fewer than 10 employees.

The Dominican government actively seeks FDI through enticing tax breaks and other incentives. Membership in the Central America Free Trade Agreement-Dominican Republic (CAFTA-DR) further enhances its appeal to foreign investors, fostering competition, bolstering legal frameworks, and broadening access to high-quality goods. Incentives for investment span various sectors including tourism, renewable energy, film production, and industrial development along the Haiti-Dominican Republic border. With a keen eye on nearshoring opportunities, the Dominican Republic boasts extensive free trade zones offering nearly full tax exemption. Key agencies responsible for attracting FDI include the Export and Investment Center of the Dominican Republic (CEI-RD) and the National Council of Free Trade Zones for Export (CNZFE). Foreign Investment Law No. 16-95 permits unrestricted foreign investment across most sectors, ensuring national treatment for foreign investors as per the Constitution. Both foreign and domestic entities enjoy the liberty to establish and operate businesses. Although labor laws stipulate a majority Dominican workforce, enforcement varies. Foreign investors in the Dominican Republic highlight several systemic challenges, including unclear and non-standardized competition rules, inadequate enforcement of regulations, and pervasive corruption at national and local government levels. Additional concerns encompass deficient technical capabilities within the government, centralized decision-making processes, delays in payments, and weak intellectual property rights enforcement. Moreover, bureaucratic obstacles, slow judicial procedures, and biased administrative processes further hinder investment. Land tenure laws and private property rights face ongoing issues, while administrative and judicial decisions are perceived as inconsistent and opaque. Overall, a lack of transparency and ineffective law implementation exacerbate investor grievances. The country ranks 108th among the 180 economies on the 2023 Corruption Perception Index and 58th out of 184 countries on the latest Index of Economic Freedom.


Country Comparison For the Protection of Investors

  Dominican Republic Latin America & Caribbean United States Germany
Index of Transaction Transparency* 5.0 4.1 7.0 5.0
Index of Manager’s Responsibility** 4.0 5.2 9.0 5.0
Index of Shareholders’ Power*** 8.0 6.7 9.0 5.0

Source: Doing Business - Latest available data.

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action.

Foreign Direct Investment 202020212022
FDI Inward Flow (million USD) 2,5603,1974,010
FDI Stock (million USD) 44,686.047,883.051,893.0
Number of Greenfield Investments*
Value of Greenfield Investments (million USD) 2,5587363,542

Source: UNCTAD - Latest available data

Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.


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Tax Rates

Tax on the Transfer of Industrialised Goods and Services (ITBIS)
18% (standard rate).
A reduced rate at 16% applies to yoghurt and other dairy derivatives; coffee; butter, margarine and oils; powdered cacao (with or without sugar) and unfilled cacao bars; and sugar.
Exempt items include live animals; fresh, refrigerated or frozen meat; fish for popular consumption or reproduction; milk, eggs and honey; non-processed fruit for massive consumption; cocoa, chocolate and some grains and cereals; certain types of medicines; certain types of books and magazines; education services, including theatre, ballet, opera and dance; health services; electricity, water and garbage collection services; financial and insurance services.
Exports are zero-rated.
Company Tax
Withholding Taxes
Dividends: 10%, Interests: 0 (resident companies)/10%, Royalties: 0 (resident companies)/10% (resident individuals)/27% (non-residents).
Social Security Contributions Paid By Employers
7.10% (pensions), 7.09% (family healthcare), and 1.2% (labour risks insurance)
Other Domestic Resources
Directorate-General for Internal Revenue
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.

Individual Taxes

Personal income tax Progressive rates from 0 to 25%
Up to DOP 416,220 0%
DOP  416,220 - 624,329 15%
DOP 624,329 - 867,123 20%
DOP 867,124 and above 25%
Capital gains tax 25%

Country Comparison For Corporate Taxation

  Dominican Republic Latin America & Caribbean United States Germany
Number of Payments of Taxes per Year 7.0 28.2 10.6 9.0
Time Taken For Administrative Formalities (Hours) 317.0 327.5 175.0 218.0
Total Share of Taxes (% of Profit) 48.8 46.8 36.6 48.8

Source: Doing Business - Latest available data.

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Investment Opportunities

Tenders, Projects and Public Procurement
Inter-American Development Bank, Tenders in South America
DgMarket, Tenders Worldwide
Setting Up a Company
Consult Doing Business Website, to know about procedures to start a Business in Dominican Republic.
Useful Resources
Dominican Republic Export and Investment Centre (CEI-RD) (only in Spanish)

Business Setup Procedures

Setting Up a Company Dominican Republic Latin America & Caribbean
Procedures (number) 7.00 8.00
Time (days) 16.50 25.22

Source: Doing Business.


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Latest Update: May 2024