In 2020, a year in which the Covid-19 pandemic forced the closure of commerce and slowed down the bulk of productive activities, both nationally and internationally, the Dominican Republic was the only country where foreign direct investment (FDI) in the manufacturing sector increased by 23%.
The data is offered by the Economic Commission for Latin America and the Caribbean (ECLAC) in its recent report “Foreign Direct Investment in Latin America and the Caribbean”, where it points out that the region reached the lowest value of FDI in the last decade, a fall of 34.7%, an inter-annual decrease only comparable to that of 2009, when inflows were reduced by 37.1%, as a result of the international financial crisis.
ECLAC points out that investment announcements in 2020 fell by 50% and were dominated by companies from the United States, ahead of those from Spain and France. China played a much smaller role in investment announcements than in mergers and acquisitions in the region.
Last year, according to Cepal, FDI reached US$2.554 billion, US$467 million less than in 2019, evidencing a 15.4% drop, one of the lowest in the region.
“The Dominican Republic remained the main recipient country, despite a reduction in inflows of 15.4%, followed by Guyana, which began to receive higher levels of FDI since it began exploiting hydrocarbons,” the report explains.
It points out that this result is mainly explained by the fall in FDI inflows in mining and telecommunications (-91% and -139%, respectively) and notes that the telecommunications sector presented highly variable investments and has registered a particularly high investment in 2019 (more than three times the 2010-2018 average).
Likewise, Cepal exposes as a source of FDI attraction renewable energies with several foreign investment projects in this increasingly important sector for Caribbean economies.