Ever wondered what it would be like to invest your money in paradise? The Dominican Republic takes up two-thirds of the Hispaniola, an island it shares with Haiti on the western side. After Cuba, it is the second largest Caribbean island. English is broadly spoken in the Dominican Republic, but Spanish is the official language. The country has a lot to offer other than just beautiful beaches and great weather. It has one of the most mixed tourism sectors in both the Caribbean and Central America. Composed of many historical sites, various national parks, and abundant vegetation, the Dominican Republic has diverse landscapes spanning from high mountains to its famous white beaches and mangroves, along with 16 national parks. Keep reading to find out why the Dominican Republic is the perfect place to invest in hospitality, tourism, and real estate.
Hospitality & Tourism
As of July 2016, the Dominican Republic consisted of a total of 69, 816 hotel rooms. In 2015, guests occupied 75.5 percent of hotel rooms, which was a more substantial amount than that of the whole Caribbean. Also, GoDominicanRepublic.com stated a predicted increase of 18,000 new hotel rooms in 2019 with investments valued at $2 billion and 55 new hotel projects.
Most air traffic into the country comes from the Punta Cana International Airport (PUJ). Followed by Santo Domingo’s Las Americas International Airport (SDQ) and Puerto Plata’s Gregorio Luperón International Airport (POP). Nine different nationalities and 145 countries do not require a tourist visa. Furthermore, those visiting from Canada and the United States, only need to buy a tourist card once they arrive.
Early in 2016, the Dominican Republic also reported a 5.8 percent increase across all tourism sectors, which was increasing more rapidly than the total rate of the Caribbean at 3.7 percent. Almost all the visitors arriving in D.R. come from the United States and Canada. In 2015, there were 2 million visitors from the U.S. and 780,000 from Canada. 4.5 million tourists arrived in the Dominican Republic by plane in 2015, which encouraged a 22.7 percent tourism growth with the visitors totaling up to 5.6 million, per Central Bank data gathered by listin.com.do.
Why Invest in the Dominican Republic?
According to Live and Invest Overseas, the Dominican Republic has had the fastest growing economy in the Americas for the past three years. This growth has been mostly thanks to the approximately 60% of 6 million tourists per year, coming from North America. The other majority of visitors arrive from Europe and also invest in hospitality, tourism, and real estate.
- Call centers
- Renewable energy
- Software development
- And tourism of course
Since the country is dedicated to the progress of travel, starting a business within the industry may make you eligible for tax “breaks” for the following ten years on income taxes, VAT, real estate transfers, property tax, import duties, etc.
Foreign Investment Laws
The great thing about being a foreign investor in D.R. is that under the law, you receive the same treatment and rights as a local investor. The only exception is political involvement. As a foreigner, you can invest in real estate under your name, and freely sustain ownership in joint endeavors and native businesses. Investments in hotels and resorts, which are five years or older, are not liable to taxes and duties connected to the purchase of appliances, furniture, and materials needed to update those properties.
Other than tourism, the renewable energy sector has been another prime concern of the Dominican government. No taxes are associated with earnings coming from the creation and sale of electricity, hot water, steam power, biofuels or synthetic fuels produced by renewable energy sources. Also, there are no customs duties on the import of any gear needed to set up businesses like this.
Property Market Powered by Tourism
Due to tourism, the real estate market prices have been increasing consistently after the global economic crisis of 2008 – 2009. In recent years, property prices in the Dominican Republic have been rising by 10% every year, but it continues to be one of the most affordable real estate markets in the Caribbean. Foreign investors get a 50% relief from property tax, as well as mortgages. There is also exemption provided for payment of fees for household and personal items and property transfers.
• Air Conditioning and Refrigeration Equipment
• Automobile Parts and Services
• Building Products
• Hotel and Restaurant Equipment
• Medical Equipment
• Renewable Energy
• Sporting Goods
• Printing and Graphic Art Equipment and Supplies
• Safety and Security Equipment and Supplies
• Telecommunication Equipment
As you can see, the Dominican Republic is a great place to invest in hospitality, tourism, and real estate. To be successful and build your own business within any of these industries in the Dominican Republic, you must first, comprehend their business conditions. Learning how to earn the trust of a Dominican business person, is very important. Therefore, in-person meetings are standard since it allows them to examine your personality and decide whether they see a possibility of working with you. They value trust above most qualities. While Dominicans may not always be punctual, we recommend for you to arrive at these meetings on time. First impressions are everything!
Give firm handshakes, and greet the person you are meeting with according to the time of day. For example, say “Buenos días” or “Buenas tardes.” Meetings are usually held in the morning and business lunches in the afternoon in a restaurant close to the company. Do not jump straight into business! Remember, since they value trust, it is vital for them to get to know you on a personal level. Therefore, it is not wrong for you to ask them about their own life. As aforementioned, English is widely-spoken, but you should still provide all materials translated into Spanish, including your business card.
There are many benefits and flexibility provided to those who invest in hospitality, tourism, and real estate in the Dominican Republic. In conclusion, it seems like the time is better than ever to get away from the bad weather, and high taxes by escaping to paradise.
Gisel Olivares, Content Editor + Creator + Curator. Her online business, GeeOlives, provides social media management, copywriting and editing, web customization and development, and graphic design, among other related services to small businesses, nonprofits, and sustainable brands. I have a love for languages, traveling, social media, and writing. I am fluent in English and Spanish, and still working on perfecting my French while living in France for almost three years.