Tourism and Economic Growth in the Dominican Republic: 1985-2018

Tourists – overnight visitors – to the Dominican Republic have increased from 560,000 in 1984 to 6.6 million in 2018 – a nearly 12-fold increase in 34 years. Hotel rooms and tourism jobs have increased by similar factors. The eastern tip of the island was home to only a few families in the early 1980s, and Punta Cana now welcomes six of every ten tourists to the country. The Colonial Zone in the capital city of Santo Domingo, has seen its 16th century buildings transformed into museums, restaurants, shops, and boutique hotels. Cobblestone streets now afford higher priorities to pedestrian traffic; and cruise-ship passengers are welcomed into the Colonial Zone several times a week. Airports and sea port facilities have also expanded steadily in the Dominican Republic to accommodate and attract tourists. The Punta Cana International Airport inaugurated in 1982 was the first privately built international commercial airport in the world. In 2018, it handled around eight million passengers from some 100 cities in 28 countries, making it the leading airport in Central America and the Caribbean. The Dominican Republic currently has eight international airports and five ports that handle cruise ships. Over the same period of time, since the mid-1980s, the economy of the Dominican Republic has outperformed that of nearly every other country in Latin America. With tourism receipts equal to 9.5% of GDP in 2017, the DR is more dependent on tourism than any other country in Latin America. Given the visible changes that tourist growth has wrought in the Dominican Republic, it is easy to assume that tourism has been the key to the country’s remarkable economic growth since the mid-1980s. But it is not quite so simple. The Dominican economy has changed in numerous ways since the mid-1980s and has become a complex economy with lots of moving parts. This paper helps explain how economic growth from tourism fits into changes in the overall economy, with an overview of the Dominican economy and its growth and evolution since the mid-1980s.