Agriculture sector in Dominican Republic

Agricultural landscape

Dominican-UK trade is increasing; from £123.6 million in 2008, it stood at £155.3 million in 2012. The agriculture sector in the DR requires foreign investment and the adoption of new technologies to support its growth and sustainability.

Market overview

Agriculture in the Dominican Republic is a very important sector in terms of food, revenue, and employment. In recent years the agriculture sector has represented, on average, 8.2% of GDP, with average annual growth of 4.4%.

The Dominican Republic has been liberalizing its trade since the 1990s. Free trade agreements with the country´s main international partners instigated a process of reduction of tariffs for imports. The majority of products required by the agriculture sector are free of additional taxes, though some are required to pay ITBIS (VAT), currently at 18%. Much of the equipment and tools used by the agriculture sector are exempt from all taxes, including ITBIS.

In 2011 the agriculture sector represented 8% of the GDP of Latin America and the Caribbean (11% in DR), but the complete scope of the contribution of agriculture could reach 20.2% in these countries. Integration and globalization processes are having important effects with the agriculture and rural development of the American continent. Their influence is felt in the decision-making process in agriculture policies including public investment in new technologies.

Agriculture has renewed importance in the national and international public debate. A rethinking of the situation of agriculture in the Dominican Republic comes because it is a strategic sector and because of its influence in food security and sovereignty, reduction of poverty, and political and economic stability. Another important reason is that it is a cardinal factor within the policies of sustainable development, which makes it necessary to focus on the relationship between agriculture and natural resource management.

Key opportunities

  • Technologies to obtain or produce organic fertilizers at lower costs

  • Heavy machinery, tools including technical service and training for field crops

  • Training in crop protection

  • The establishment of a tissue culture laboratory to multiply cacao plants

  • Implementation of the procedures required to obtain Fairtrade certification and produce commercial association among exporters and fruit distributors in Europe for long term commercial growth

  • Improvement and development concerning fertilizing through irrigation systems and mechanized fumigation equipment

  • Upgrade the equipment used for processing the fruit, including cutting, packing and cold storage

  • Expertise is required for the development of products that contain coffee as an ingredient, so more products with added value from the coffee industry may be marketed

  • Training and better organization among farmers is required for the production and marketing of organic cheese, yogurt, and organic certified milk

  • Expertise in climate-controlled and precision agriculture

  • Expertise for the implementation of new tests and technologies for labs that serve the agriculture sector.

  • Expertise for the sustainable management of forests in areas that traditionally have been used for livestock farming and extensive crops such as sugar cane.

Latest export opportunities in the Agriculture, Horticulture and Fisheries sector

Latest export opportunities in Dominican Republic

Getting into the market

The first requirement to receive imported goods in the DR is to be registered in the General Directorate of Internal Taxes (DGII) and request a number of the National Contributor Registry (RNC). The registry system of the DGII is linked to the network of the General Directorate of Customs (DGA), so those registered as contributors or tax-payers will appear in the registry of the DGA.

Products for the agriculture sector usually require a permit from the Ministry of Agriculture, which should be negotiated in advance. Any product that is related to animal husbandry including feed or medicinal drugs requires a permit from the General Directorate for Livestock (DIGEGA). For the introduction of a new product that needs approval, this should be done weeks in advance. When there is no need of making a risk analysis, or if there are precedents, these procedures may be done expeditiously.

The current official data for tariffs was published in Customs Tariffs of the Dominican Republic, Law 146-2000 and its modifications. Particular inquiries for specific products can be made at the DGA main office in Santo Domingo. Products used in agriculture have a privileged position regarding tax burden. The majority of agriculture inputs including fertilizers and their components, agrochemicals, pesticides, fungicides, cattle and poultry feed, and some tools are exempt of the Transfer of Industrialized Goods and Services Tax (ITBIS, similar to VAT), which is equivalent to 18%, and of other taxes, so they enter the country with a 0% tariff rate. Seeds for planting corn, wheat, oat, and others are exempt of all taxes, but some seeds do pay ITBIS (18%) as in the case of barley seeds.

Agriculture machinery such as tractors and those used for milk processing are free from all taxes. Some equipment and tools such as cutters, pulp machines, and agro-industry equipment are charged only 18% of ITBIS tax in the DR. Implements and tractor parts usually have a tax of 8% plus 18% of ITBIS. Other agriculture equipment such as manual and mechanical backpack sprayers do not pay any additional tax, but do pay 18% of ITBIS.

More about doing business in Dominican Republic

Contacts

Market intelligence is critical when doing business overseas, and UKTI can provide bespoke market research and support during overseas visits though our chargeable Overseas Market Introduction Service (OMIS).

To commission research or for general advice about the market, get in touch with our specialists in country – or contact your local international trade team.

UKTI Events

UKTI runs a range of events for exporters, including seminars in the UK, trade missions to overseas markets and support for attendance at overseas trade shows.

Major Events

Agroalimentaria

May 2014

www.agroalimentaria.com.do

Latest events in the Agriculture, Horticulture and Fisheries sector

Useful links

More about OMIS and other UKTI services for exporters

Sectors: Agriculture, Horticulture & Fisheries
Countries: Dominican Republic
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