Dominican Republic: Background and U.S.
Relations
Clare Ribando Seelke
Specialist in Latin American Affairs
November 1, 2010
Congressional Research Service
7-5700
www.crs.gov
R41482
CRS Report for Congress
P
repared for Members and Committees of Congress
Dominican Republic: Background and U.S. Relations
Summary
The Dominican Republic, a country of roughly 9.7 million people that shares the Caribbean
island of Hispaniola with Haiti, is a key U.S. trade partner and political ally in the region. The
United States is the Dominican Republic’s main trading partner, with two-way trade totaling more
than $10.6 billion in 2008 before falling to $8.6 billion in 2009. In addition to trade, U.S. interest
in the Dominican Republic has focused on anti-drug cooperation and governance/human rights
issues, as well as the country’s role in helping resolve regional conflicts. After a July 12, 2010,
official meeting, President Barack Obama praised Dominican President Leonel Fernández’s
regional leadership, particularly the role he and his government have played in the aftermath of
the January 2010 earthquake in Haiti and in helping to resolve the political crisis in Honduras.
President Fernández of the center-left Dominican Liberation Party (PLD) took office for his third
term in August 2008. Fernández previously served as President from 1996-2000 and 2004-2008.
In 2009, President Fernández achieved one of his primary political goals: securing congressional
approval of a new constitution. The new constitution, which took effect in January 2010, allows
presidents to complete one term and then serve again after sitting out of office for four years,
making President Fernández eligible to run again in 2016. Few have criticized Fernández for
changing the constitution to allow himself to run for another term, but some have spoken out
against calls from the PLD for further changes that would enable him to run in 2012. Despite
some lingering economic and security challenges that have yet to be resolved and concerns about
corruption in his Administration, President Fernández has remained popular. His party dominated
legislative elections held on May 16, 2010.
In recent years, U.S. interest in the Dominican Republic has focused on trade, security, and
human rights issues. Trade and investment flows have expanded since the Dominican Republic-
Central America-United States free trade agreement (CAFTA-DR) entered into force for the
Dominican Republic on March 1, 2007. U.S. trade capacity building assistance has also
reportedly helped boost Dominican competitiveness in some sectors. The United States is the
largest bilateral donor to the Dominican Republic, with U.S. assistance totaling an estimated $49
million in FY2010. U.S. aid — both bilateral and regional aid provided through the Mérida
Initiative and the Caribbean Basin Security Initiative (CBSI) — is helping the Fernández
government combat drug trafficking and crime. Human rights issues, including the treatment of
Haitians in the Dominican Republic and trafficking in persons, have also been of interest to
Congress and the Obama Administration.
This report provides background information on current political and economic conditions in the
Dominican Republic, as well as an overview of some of the key issues in U.S.-Dominican
relations.
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Dominican Republic: Background and U.S. Relations
Contents
Background ................................................................................................................................ 1
Political Situation........................................................................................................................ 2
Constitutional Reform........................................................................................................... 3
May 2010 Legislative Elections ............................................................................................ 4
Foreign Relations .................................................................................................................. 4
The 2012 Presidential Elections: Will Fernández Run Again? ................................................ 5
Economic Conditions .................................................................................................................. 6
U.S. Relations ............................................................................................................................. 8
Foreign Aid........................................................................................................................... 9
Counter-Narcotics Issues..................................................................................................... 10
Human Rights ..................................................................................................................... 10
Trade .................................................................................................................................. 12
Figures
Figure 1. Map of the Dominican Republic and Haiti .................................................................... 2
Figure 2. Annual Gross Domestic Product (GDP) Growth in the Dominican Republic:
1995-2010................................................................................................................................ 7
Tables
Table 1. U.S. Assistance to the Dominican Republic: FY2007-FY2011........................................ 9
Contacts
Author Contact Information ...................................................................................................... 13
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Dominican Republic: Background and U.S. Relations
Background
The Dominican Republic is situated on the eastern two-thirds of the Caribbean island of
Hispaniola, which it shares with Haiti. A population of about 9.7 million occupies an area about
the size of New Hampshire and Vermont combined. With an annual per capita income of $4,576,
the Dominican Republic is classified by the World Bank as an upper middle-income country. This
stands in sharp contrast to neighboring Haiti, which had a per capita income of just $729 before
an earthquake devastated the country and its economy in January 2010.1
After fighting to achieve its independence from Spain in 1821 and then from Haiti in 1844, the
Dominican Republic embarked upon a bumpy road toward its current democratic form of
government characterized by frequent coups, dictatorships, and U.S. interventions (including
1916-1924 and 1965-1966).2 Rafael Trujillo ruled the country as a dictator from 1930 to 1961,
often employing violent tactics to quell political opposition. Despite his brutality, Trujillo’s strong
anticommunist stance earned him tacit support from the United States. His acolyte, Joaquín
Balaguer, then served as president from 1960-62, 1966-78, and 1986-96. As a result of the
dominance of these caudillo (strongman) leaders, the Dominican Republic did not develop into a
modern democracy until the 1990s. In 1994, an agreement commonly referred to as the “Pact for
Democracy” removed the aging Balaguer from power and paved the way for the country’s first
truly free and fair elections to be held in 1996.3
The Dominican Republic is a key U.S. ally in the Caribbean region and the largest export market
for U.S. goods in Central America and the Caribbean. In recent years, U.S. interest in the
Dominican Republic has primarily focused on expanding trade opportunities through the
Dominican Republic-Central America-United States free trade agreement (CAFTA-DR), fighting
drug trafficking, and promoting good governance and human rights. The Dominican Republic has
received U.S. foreign assistance on a bilateral basis, as well as through regional programs such as
the Mérida Initiative4 and the new Caribbean Basin Security Initiative (CBSI). President Obama
has praised current Dominican President Leonel Fernández for the leadership role he has played
in responding to the earthquake in Haiti and in helping to resolve political crises in Latin
America, including the recent crisis in Honduras and disputes between Colombia and Venezuela.5
1 Annual per capita income estimates are drawn from: World Bank. World Development Indicators 2009. For more
information on the earthquake in Haiti, see: CRS Report R41023, Haiti Earthquake: Crisis and Response, by Rhoda
Margesson and Maureen Taft-Morales.
2 After a period of instability in the country, the U.S. military intervened in 1916 ostensibly to restore order, but did not
depart until elections were held in 1924. U.S. troops again occupied the Dominican Republic in 1965-1966 after a civil
conflict erupted following the 1963 coup that ousted Juan Bosch, founder of the anti-Trujillo Dominican Revolutionary
Party (PRD), from power.
3 For a history of the Dominican Republic, see: Frank Moya Pans, The Dominican Republic: a National History (New
Rochelle, NY: Hispaniola Books Corporation, 1995); Jonathan Hartlyn, The Struggle for Democratic Politics in the
Dominican Republic (Chapel Hill, NC: University of North Carolina Press, 1998).
4 Although not included in the original Mérida Initiative request, which was designed to combat drug trafficking and
crime in Mexico and Central America, Congress dedicated $2.5 million for the Dominican Republic in P.L. 110-252
and again in P.L. 111-8. CRS Report R40135, Mérida Initiative for Mexico and Central America: Funding and Policy
Issues, by Clare Ribando Seelke.
5 The White House: Office of the Press Secretary, "Remarks Following a Meeting with President Leonel Fernandez
Reyna of the Dominican Republic," press release, July 12, 2010.
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Figure 1. Map of the Dominican Republic and Haiti
Source: United Nations Office for the Coordination of Humanitarian Affairs, as adapted by CRS graphics.
Political Situation
In the last fifteen years, the Dominican Republic has, for the most part, posted solid economic
growth (see Figure 2 below) and developed stronger democratic institutions. In 1996, Leonel
Fernández of the center-left Dominican Liberation Party (PLD) succeeded Joaquín Balaguer as
president and presided over a period of strong economic growth fueled by expansion in tourism
and free trade zones. In the 2000 presidential elections, after top PLD officials were charged with
misusing public funds, Hipólito Mejía (2000-2004), an agrarian engineer of the populist
Dominican Revolutionary Party (PRD), defeated the PLD candidate, Danilo Medina. He lost
support, however, by spending excessively and deciding to bail out all deposit holders after three
massive bank failures in 2003. Mejía seemed to focus more on his reelection bid, which required
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a constitutional amendment reinstating consecutive presidential reelection, than on resolving the
country’s deep economic crisis. Leonel Fernández defeated Mejía easily in 2004 to garner another
four-year term. During his second term, President Férnandez restored investor confidence in the
Dominican economy, but his government received criticism for failing to address corruption and
for its treatment of Haitians living in the country. Nonetheless, Férnandez won reelection in 2008.
Halfway through his third presidential term, President Fernández is in a commanding position.
Fernández and the PLD lost some support in 2009 due to the country’s economic problems, as
well as the government’s apparent inability to address a persistent electricity crisis (frequent
blackouts are still the norm), high crime rates (the homicide rate stood at roughly 20.5 per
100,000 people in 20086), and corruption. In Transparency International’s 2010 Corruption
Perceptions Index, the Dominican Republic ranked 19th out of 28 countries in Latin America and
101 out of 178 countries in the world.7 In spite of those lingering challenges, President Fernández
achieved one of his primary political goals in 2009: securing congressional approval of a new
constitution. Fernández’s party dominated the legislative elections held in May 2010, giving him
a strong legislative position as he attempts to implement the new constitution, address fiscal
reform, and solve lingering social issues and security challenges.
Constitutional Reform
The constitutional reform package emerged as a result of negotiations between Fernández and
Miguel Vargas Maldonado, the president of the opposition PRD, on certain key points with some
input from the Dominican Congress. The Congress approved the constitution in October 2009,
and it took effect in January 2010. Noteworthy provisions include:
• Allowing a President to complete one term and then serve again only after sitting
out of office for four years (i.e., President Fernández is eligible to run again in
2016);
• Making presidential and legislative elections coincide beginning in 2016 (the
current Congress will serve until then);
• Revamping the structure of the judiciary;
• Banning abortions under all circumstances and describing marriage as
exclusively between a man and a woman; and,
• Defining citizenship such that the children of immigrants residing in the country
illegally (of whom there are currently an estimated one million Haitians) are
ineligible to receive Dominican nationality.8
6 That figure came from the Dominican Attorney General’s Office. For comparative purposes, the homicide rate in the
United States stood at 5.0 and the homicide rate in Mexico stood at 11.6 in 2008. See: U.N. Office on Drugs and Crime,
“Homicide Statistics, Criminal Justice Sources - Latest available year (2003-2008),” available at:
http://www.unodc.org/.../Criminal_justice_latest_year_by_country.20100201.xls.
7 Each year, Transparency International’s Corruption Perception Index measures the perceived levels of public sector
corruption in countries around the world. Countries are ranked on a scale from 10 (highly clean) to 0 (highly corrupt).
The countries ranked at the top of the list have the lowest levels of perceived corruption. For more information, see:
http://www.transparency.org/policy_research/surveys_indices/cpi/2010/results.
8 “Dominican Republic: Flawed Constitution has Many Good Points,” Latin News Weekly Report, February 4, 2010.
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Among these provisions, the last measure, which effectively eliminates the notion of birthright
citizenship in the Dominican Republic, has been particularly controversial. Dominican and
international human rights organizations that had criticized the 2004 Migration Law, which
deemed the children of non-citizens born in the Dominican Republic as “in transit” and therefore
ineligible for citizenship, have also spoken out vigorously against this new constitutional
provision.9 Analysts have already reported that the new constitution has resulted in “a growing
number of stateless individuals” in the Dominican Republic, a situation which is likely to worsen
as Haitians continue to flee devastating post-earthquake conditions in their country.10 (For more
information, see “Human Rights” section below).
May 2010 Legislative Elections
As the Dominican economy began to recover from the global recession in early 2010, partially as
a result of support from the International Monetary Fund (IMF) and multilateral donors, political
attention turned to focus on the May 16, 2010, legislative elections. As a result of those elections,
President Fernández’s PLD has increased its dominance over the Dominican political system and
now controls 31 of 32 seats in the Dominican senate and 105 of 183 seats in the chamber of
deputies. Its coalition partner, the Social Christian Reformist Party (PRSC), garnered one senate
seat and three chamber seats. In contrast, the PRD, which has been plagued by internal disputes,
did not win any senate seats and now has only 75 seats in the lower chamber. President Fernández
will now be able to count on strong legislative majorities for the rest of his term.
Foreign Relations
President Fernández has maintained close ties with the United States, but has also sought to
diversify the Dominican Republic’s trade and investment ties and to raise the country’s
international profile by mediating in regional conflicts and supporting reconstruction efforts in
Haiti. The Dominican government signed an Economic Partnership Agreement with the European
Union in 2008, and is negotiating free trade agreements with Canada and Mexico, among others.
In March 2008, President Fernández hosted a meeting of the Rio Group11 during which he helped
diffuse tensions between Colombia, Venezuela and Ecuador after Colombian military forces
carried out an unauthorized raid on a Revolutionary Armed Forces of Colombia (FARC) camp in
Ecuador. Fernández has also helped mediate more recent disputes between Venezuela and
Colombia. The Dominican government also played a role in trying to help negotiate a peaceful
settlement to the political crisis that occurred in Honduras after the June 2009 ouster of then-
President Manuel Zelaya. Some observers maintain that Fernández could also play a role in future
negotiations between the United States and Cuba.12
Despite centuries of tension between the two countries, the Dominican Republic responded to the
January 2010 earthquake in Haiti with an outpouring of public and private donations and emerged
9 See, for example, Robert F. Kennedy Center for Justice and Human Rights, "Memo: Constitutional Changes in the
Dominican Republic," press release, February 5, 2010.
10 “Country Report: Dominican Republic,” EIU, October 2010.
11 The Rio Group is an international organization of Latin American and some Caribbean states that meets annually to
discuss political and economic issues of interest to the region.
12 “Country Report: Dominican Republic,” EIU, September 2010.
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as a key supporter of international relief and reconstruction efforts.13 President Fernández was the
first foreign leader to visit Haiti after the earthquake and his government provided essential
services like food (28 mobile kitchens capable of producing 300,000 meals a day), potable water,
and blankets to thousands of earthquake victims. The Dominican military constructed 2,500
temporary shelters, while hospitals in the Dominican Republic treated over 14,000 earthquake
victims. Dominican companies complemented government efforts by donating several million
dollars worth of products and services.
According to a database tracking foreign contributions to Haiti’s reconstruction, in-kind
contributions from the Dominican Republic have totaled roughly $60 million in 2010 and may
reach $50 million in 2011.14 In addition to these donations, the Dominican Republic has served as
a logistical hub for international relief efforts in Haiti, hosted an international donors conference,
and contributed to discussions on a future plan for Haiti. Many analysts have praised these efforts
and said that the mending of Dominican-Haitian relations has been one of the only positive
byproducts that has occurred as a result of the earthquake in Haiti.15 New strains could emerge,
however, should large numbers of Haitian migrants continue to flow into the Dominican
Republic.
The 2012 Presidential Elections: Will Fernández Run Again?
Many PLD activists have urged the still popular President Fernández to pursue another
constitutional change that would allow him to run for reelection in 2012. However, some civic
organizations, analysts, and unions have spoken out against the prospect of a third consecutive
Fernández presidency, albeit for different reasons. Some critics oppose Fernandez’s policies,
while others are concerned about the potential impact that allowing so many successive
reelections might have on democracy in a country with a history of long-serving leaders.16
Many analysts currently predict that, rather than running in 2012, President Fernández will likely
lend his support to a handpicked successor and then run again in 2016. Fernández’s wife,
Margarita Cedeño, has been mentioned among a list of potential successors. Whoever wins the
PLD nomination is likely to face his or her main challenge from the PRD, with Miguel Vargas
Maldonado, former president Hipólito Mejía, and economist Luis Abinader among the possible
contenders for that party’s nomination.17
The outcome of the 2012 presidential elections may well hinge on the degree to which Fernández
and the PLD are able to solve perennial problems like crime, corruption, and electricity shortages
over the course of the next two years.18
13 For a history of Dominican-Haitian relations, see: Michele Wucker, Why the Cocks Fight: Dominicans, Haitians, and
the Struggle for Hispaniola (New York: Hill and Wang, 2000). For information on Dominican contributions to
reconstruction in Haiti since the earthquake, see: "Rebuilding Haiti," Foreign Affairs, vol. 89, no. 5
(September/October 2010).
14 Government of the Republic of Haiti, Haiti Reconstruction Platform (HRP), available at: http://www.refondation.ht.
15 Frances Robles, “Haiti, Dominican Republic now Have Smoother, but Fragile, Relationship,” McClatchy-Tribune
News Service, July 26, 2010.
16 “Talk of 3rd Term for Dominican President Spurs Debate,” EFE, August 16, 2010.
17 “Country Report: Dominican Republic,” EIU, October 2010.
18 “Dominican Leader Returns to a Crime, Corruption Plagued Nation,” Dominican Today, October 4, 2010.
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Economic Conditions
From 1995 through 2002, rapid expansion in both the tourism and free-trade zone (FTZ) sectors
boosted average annual growth rates in the Dominican Republic to more than 6.0% (see Figure
2). Remittances from Dominicans living abroad contributed $1.5 billion per year to the country's
stock of foreign exchange. Economic expansion was also facilitated by the passage of several
market-friendly economic reforms in the late 1990s by then-President Leonel Fernández. One
critical reform was a 1997 law allowing the partial privatization of unprofitable state enterprises.
In 2003, the Dominican economy, wracked by banking scandals and economic mismanagement,
contracted by 0.3%. The country's public finances were placed under enormous strain after then-
President Hipólito Mejía bailed out the country's third largest bank, Banco Intercontinental
(Baninter), which collapsed in May 2003, and two other banks. The Baninter scandal occurred
after bank executives defrauded depositors of U.S. $2.2 billion worth of account holdings -- an
amount equal to almost 67% of the country's annual budget. The country's precarious economic
situation was exacerbated by the administration's failure to comply with IMF conditions. As a
result, inflation in the Dominican Republic reached 42%, unemployment stood at 16.5%, and the
country’s currency (the peso) lost more than half of its value.
Economic recovery occurred during Fernández’s second term (2004-2008), as inflation
decelerated, growth resumed, and the peso more than regained its pre-crisis value. In February
2005, President Fernández signed a $665 million standby agreement with the IMF, which expired
in January 2008. The IMF's official review of the three-year package lauded the government's
ability to bounce back from the economic crisis and efforts to bring public spending under
control. However, the IMF also criticized the government's failure to enact some financial market
regulations and to meet benchmark standards in the electricity sector.19 The Fernández
government also struggled to reduce poverty, as the percentage of Dominicans living below the
national poverty line increased from 42% in 2004 to 48.5% in 2007, according to the World Bank.
Although the Dominican economy fared better than many other economies in Latin America and
the Caribbean, its growth rate slowed in 2009 as a result of the global financial crisis, U.S.
recession, and structural problems in several sectors. Gross Domestic Product growth fell from
approximately 5.3% in 2008 to 3.5% in 2009 due to declines in tax and tourism revenues,
remittances, exports, and investment flows. At the same time, the Dominican economy continued
to struggle with electricity shortages and a lack of export competitiveness. Some analysts
criticized the Fernández government for failing to respond more quickly to the country’s
economic crisis, perhaps out of a desire to avoid signing on to another stand-by agreement with
the IMF.
On November 9, 2009, the Fernández government signed a 28-month, $1.7 billion stand-by
agreement with the IMF. According to the IMF, the immediate purpose of the agreement was to
enable the Dominican government to implement a stimulus package involving investment
projects and social safety net programs. The longer-term purpose of the package is to address
structural reform issues in the country’s tax system and electricity and energy sector.20 The
19 "IMF Executive Board Completed Final Review Under Stand-by Arrangement with Dominican Republic," U.S.
Federal News, February 4, 2008.
20 International Monetary Fund, “IMF Executive Board Approves $1.7 Billion Stand-By Agreement for the Dominican
Republic,” November 9, 2009.
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Dominican government has also secured a $300 million loan from the World Bank for social
sector programs and a $500 million loan from the Inter-American Development Bank to support
social programs and the rationalization of energy subsidies. To complement its externally-funded
stimulus package, the Fernández government is focusing on export promotion, building trade
competitiveness, and diversifying its trade and investment links.
Figure 2. Annual Gross Domestic Product (GDP) Growth in the Dominican Republic:
1995-2010
Source: The Economist Intelligence Unit.
Economic growth has picked up in 2010, with annual GDP growth expected to exceed 5%.
Growth has resumed as a result of the increasing availability of international credit and an
increase in government spending in the run-up to the May 2010 legislative elections. This year
has also seen a rise in remittances, tourism, and exports. Many economists predict that as the pace
of reconstruction efforts in Haiti quickens, demand for food and construction supplies from the
Dominican Republic should increase significantly.21 Dominican apparel exporters, many of whom
have struggled to compete with Asian producers, may also benefit from expanding coproduction
efforts with Haiti in order to take advantage of U.S. trade preferences through the Haitian
Hemispheric Opportunity through Partnership Encouragement (HOPE) Act as amended.22 Despite
these positive trends, economists maintain that the slow-growing U.S. economy (a major market
for the Dominican Republic) and structural problems in the Dominican economy - including a
21 “Caribbean Investor Report: Striving for Growth,” LatinFinance, April 30, 2010.
22 Congress last amended the HOPE Act with the Haiti Economic Lift Program (HELP) Act of 2010 (P.L. 111-171),
which improves U.S. market access for Haitian apparel exports (including some goods coproduced with the Dominican.
Republic). For more information, see: CRS Report RL34687, The Haitian Economy and the HOPE Act, by J. F.
Hornbeck.
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lack of export competitiveness and energy shortages - could constrain the country's long-term
growth potential.
Ongoing problems in the electricity sector have long constrained growth in the Dominican
Republic. Electricity providers struggle to provide adequate service to a populace angry at
continued blackouts. The Dominican government, which controls electricity distribution but not
generation, owes several hundred million dollars to private generators. A fragile grid, electricity
theft, and corruption within the distribution companies are significant challenges. In August 2009,
President Fernández selected a reformist as head of the state-owned electricity companies who
has been able to lower operating costs, increase revenue collection, and pay off some debt owed
to private generators. Those reforms have come at a cost, however. The Fernández government
had to trim the 2010 budget (except for education) by 20% in order to pay private generators for
this year’s electricity subsidies (and comply with the IMF agreement).23
The high price of importing oil has also proved challenging for the Dominican Republic. The
country has been able to find some relief from rising oil prices through PetroCaribe, an agreement
promoted by Venezuelan President Hugo Chávez that provides oil to Central American and
Caribbean nations at subsidized costs. Since 2005, the Dominican government has been able to
import up to 50,000 barrels of Venezuelan oil per day at a reduced cost as a result of PetroCaribe.
President Fernández has considered a variety of other measures to overcome the electricity crisis
and reduce its dependence on foreign oil, including promoting the use of alternative forms of
energy and providing tax breaks to the private sector for installing energy efficient technology. In
2007, the Dominican legislature passed two important energy sector laws, one that establishes a
regulatory framework and tax incentives to promote energy production from renewable sources
and another that criminalizes electricity theft and fraud. The former seems to be moving forward,
as the country continues to attract foreign investment interest for solar power, natural gas,
biomass and wind energy projects. The latter has yet to be fully implemented.
U.S. Relations
The Dominican Republic enjoys a strong relationship with the United States, evidenced by
extensive economic, political, and cultural ties. The Dominican Republic is one of the most
important countries in the Caribbean because of its large size, diversified economy, and close
proximity to the United States. The United States has been a strong supporter of the democratic
and economic development of the country, and is currently assisting President Fernández’s efforts
to improve Dominican competitiveness, strengthen governance, and combat drug trafficking. The
ongoing implementation of CAFTA-DR and the HOPE Act as amended, will also ensure close
economic relations. After a July 12, 2010, meeting in the White House, President Obama praised
President Fernández’s leadership in the region, particularly the role he and his government have
played in the aftermath of the earthquake in Haiti and in helping to resolve the political crisis in
Honduras.24
23 Interview with Dominican government official, September 22, 2010.
24 The White House, Office of the Press Secretary, “Remarks by President Obama and President Fernandez of the
Dominican Republic in Joint Press Availability,” July 12, 2010.
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Foreign Aid
The United States is one of the largest bilateral donors to the Dominican Republic, with U.S.
assistance totaling an estimated $49 million in FY2010 (see Table 1 below). U.S. foreign
assistance is currently focused on helping the Férnandez government improve governance,
combat drug trafficking and crime, implement the CAFTA-DR, provide quality healthcare and
education services, and protect the environment.
Table 1. U.S. Assistance to the Dominican Republic: FY2007-FY2011
U.S. $ millions
FY2010
FY2011
Account FY2007 FY2008 FY2009
(est.)
req.
INCLE
0.0 3.5a 3.7a 4.5 0.0
ESF
2.1 12.4 1.1 0.0 0.0
FMF
0.7 0.0 0.4 1.0 0.0
IMET
1.0 1.0 0.7 0.9 0.9
NADR
0.5 0.4 0.0 0.0 0.0
GHCS
11.9 21.9 21.3 18.3 18.3
DA
17.0 11.0 24.6 24.6 23.3
TOTAL 34.3 50.2 51.2 49.2 42.5
Sources: U.S. Department of State, Congressional Budget Justification for Foreign Operations FY2008-FY2011.
Notes: GHCS= Global Health and Child Survival (includes total funds provided by the U.S. Agency for
International Development and the State Department); DA=Development Assistance; ESF=Economic Support
Fund; FMF=Foreign Military Financing; IMET=International Military Education and Training; INCLE=International
Narcotics Control and Law Enforcement; NADR=Non-proliferation, Anti-terrorism and Related Programs.
a. These totals include assistance provided under the Mérida Initiative in P.L. 110-252 and P.L. 111-8.
In addition to bilateral assistance, in FY2008 and FY2009, the Dominican Republic received a
total of $5 million in assistance under the Mérida Initiative, an anticrime and counterdrug
assistance package originally designed for Mexico and Central America.25 Mérida-funded projects
in the Dominican Republic are focused on supporting police professionalization programs,
providing logistical support to interdiction units, and training judicial authorities in implementing
the criminal procedure code.
In FY2010, rather than continuing to receive this assistance through the Mérida Initiative, the
Dominican Republic began to receive assistance through the Caribbean Basin Security Initiative
(CBSI), a regional security initiative first announced at the April 2009 Summit of the Americas.
U.S. support for the CBSI is focused on (1) assistance for air and maritime assets and command,
control, and communications architecture; (2) assistance for social justice and economic
development projects, with programs targeted at youth development and training; and (3)
assistance for programs to enhance the rule of law and anti-crime efforts. Congress provided $37
million in FY2010 for the CBSI in the FY2010 Consolidated Appropriations Act (P.L. 111-117).
25 For more information, see CRS Report R40135, Mérida Initiative for Mexico and Central America: Funding and
Policy Issues, by Clare Ribando Seelke.
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Of that total, the Dominican Republic is to receive roughly $5 million for alternative education
and job training programs for at-risk youth, as well as additional support for existing anti-
corruption, community policing, and education programs.26 The Obama Administration asked
Congress for an additional $79 million for CBSI in its FY2011 budget request.
Counter-Narcotics Issues
On September 16, 2010, President Obama again designated the Dominican Republic as one of
four major drug transit countries in the Caribbean. The Dominican Republic, which has seen an
increase in airborne smuggling of cocaine from Venezuela and in domestic drug abuse, cooperates
closely with the United States in antidrug efforts through seizures, joint operations, and
extraditions of drug trafficking suspects. In mid-2009, the Dominican government increased the
level of coordination between its police and its National Directorate for the Control of Drugs
(staffed by officers from the three branches of the armed forces), resulting in increased seizures
during the second part of that year. The Fernández Administration also increased the frequency
with which it tested law enforcement officials for drug use and suspended 500 police officers for
using illicit drugs. The Dominican government’s ability to interdict illicit narcotics shipments
should be further strengthened now that eight Super Tucano aircraft purchased from Brazil have
arrived.27 Despite this progress, “endemic corruption” in government and throughout the
Dominican private sector has continued to impede efforts to combat the transit of narcotics and
other criminal activities in the Dominican Republic.28
Human Rights
According to the State Department's Country Report on Human Rights Practices covering 2009,
the Dominican government continued to improve its human rights record, but significant
problems remain. Reforms of police tactics and increased punishments of officers accused of
misconduct have led to a decline in extrajudicial killings carried out by security forces, but police
killed 346 people in 2009 (down from 455 in 2008) and tortured some detainees and suspects.
While prison conditions in many older facilities ranged from "poor to extremely harsh," the
government opened 12 new correctional and rehabilitation centers. The government continued to
implement its new criminal procedures code, but many suspects continued to experience lengthy
pretrial detentions. Aside from these problems in the criminal justice sector, other human rights
problems cited in the report included: child labor; violence and discrimination against Haitian
migrants and their descendants, women, children, and gay people; and the existence of a large
number of stateless people, including Dominicans who lack birth certificates.29
In recent years, the Dominican government has received international criticism for its treatment
of an estimated one million Haitians and Dominicans of Haitian descent living within its borders
and for forcibly repatriating undocumented Haitian migrants.30 Each year, thousands of migrants,
26 U.S. Department of State, "Caribbean Basin Security Initiative (Dominican Republic)," press release, September 13,
2010, http://www.state.gov/documents/organization/148538.pdf.
27 “Leonel Entregará Hoy Tucanos en la FAD,” La República, October 28, 2010.
28 U.S. Department of State, International Narcotics Control Strategy Report (INCSR), March 2010.
29 U.S. Department of State, 2009 Country Reports on Human Rights Practices, March 2010.
30 See, for example, Amnesty International, Haitian Migrants at Risk in the Dominican Republic, October 8, 2009; and
Dominican Republic: Challenging Discrimination in the Dominican Republic: Protecting the Rights of Haitian
(continued...)
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many without proper documentation, flock from Haiti, the poorest country in the hemisphere, to
the Dominican Republic to work in the construction, tourism, and agriculture industries, as well
as in the informal sector. In the past, Haitians and their Dominican-born children were regularly
denied identity documents necessary to prove their citizenship and job status, a practice that was
condemned by an October 2005 Inter-American Court of Human Rights ruling against the
Dominican government. Beginning in 2007, the Dominican government established a system to
register the births of children born to undocumented immigrants residing in the country and to
help those children (and their parents) obtain birth certificates from their countries of origin
(which is most often Haiti). While the January 2010 constitution says that the children of
immigrants residing in the Dominican Republic illegally are ineligible for Dominican citizenship,
they are eligible for health care services and education.31 The Dominican government has worked
with private sugar companies to improve facilities in some of the bateyes (sugarcane work
camps), but living conditions remain substandard in many communities. The Dominican Republic
also stopped deportations to Haiti after the January 2010 earthquake.
Other major human rights issues in the Dominican Republic are the related problems of
trafficking in persons (TIP) and forced labor (including child labor). The Dominican Republic is a
source country for people trafficked to Europe, the United States, South America, and other parts
of the Caribbean; a transit country for trafficking victims; and a destination country for TIP
victims, particularly for undocumented Haitians. Men and women from Haiti have been trafficked
to work in agriculture, construction, and prostitution, while thousands of Haitian (and Dominican)
children have been forced to work as restaveks (child domestic servants) and in agriculture.32
Despite the enactment of an anti-trafficking/anti-smuggling law in August 2003, the Dominican
government has struggled to arrest and prosecute those accused of human trafficking, particularly
in cases involving public officials. (Most of the individuals convicted under the law thus far have
been found guilty of alien smuggling.)
On June 14, 2010, the State Department issued its tenth annual, congressionally mandated report
on trafficking in persons (TIP). In addition to outlining major trends and ongoing challenges in
combating TIP, the report categorizes countries into four “tiers” according to the government’s
efforts to combat trafficking.33 The Dominican Republic and Cuba were the only two Latin
(...continued)
Migrant Workers and their Descendants, November 9, 2008.
31 This definition of citizenship applies no matter how long undocumented Haitians have lived in the Dominican
Republic. Without access to Dominican citizenship, they (and their offspring) are unable to work in many formal sector
jobs, attend public high schools or universities, own land, or access the judicial system.
32 According to the U.S. Department of Labor, instances of child labor have been found in the cultivation of sugarcane,
rice, coffee, and tomatoes in the Dominican Republic. U.S. Department of Labor, Bureau of International Labor
Affairs, Office of Child Labor, Forced Labor, and Human Trafficking, List of Goods Produced by Child Labor or
Forced Labor, 2009.
33 Since 2001, the U.S. State Department has evaluated foreign governments’ efforts to combat trafficking in persons in
its annual Trafficking in Persons (TIP) reports, which are issued each June. Countries are grouped into four categories
according to the U.S. assessment of efforts they are making to combat trafficking. Tier 1 is made up of countries
deemed by the State Department to have a serious trafficking problem but fully complying with the minimum standards
for the elimination of trafficking. Those standards are defined in the Victims of Trafficking and Violence Protection
Act of 2000 (P.L. 106-386) as amended. Tier 2 is composed of governments not fully complying with those standards
but which are seen as making significant efforts to comply. Tier 2 Watch List, first added as a category in the 2004
report, is made up of countries that are on the border between Tier 2 and Tier 3. Tier 3 includes those countries whose
governments the State Department deems as not fully complying with TVPA’s anti-TIP standards and not making
significant efforts to do so. Tier 3 countries have been made subject to U.S. sanctions since 2003.
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American countries identified as Tier 3 (countries who do not fully cooperate in combating
trafficking) and made subject to possible U.S. sanctions. According to the report, the Dominican
Republic fell to Tier 3 for failing to convict any TIP offenders and for its limited efforts to protect
TIP victims. In September 2010, President Obama waived the imposition of any TIP-related
sanctions on the Dominican Republic because U.S. assistance to that country is either in the U.S.
national interest or intended to help combat human trafficking. The Dominican government’s
ranking in the 2011 TIP report may hinge on how it responds to recent reports that more than
7,300 Haitian children have been trafficked into Dominican territory since the January 2010
earthquake in Haiti.34
Trade
Over the past few decades, U.S.-Dominican trade and investment linkages have increased,
partially as a result of U.S. trade preference programs and the CAFTA-DR free trade agreement.
From the mid-1980s until 2000, the Dominican Republic benefitted from its involvement in the
Caribbean Basin Initiative (CBI), a unilateral U.S. trade preference program. From 2000 to 2007,
the Dominican Republic received expanded trade preferences through the Caribbean Basin Trade
Partnership Act (CBTPA) of 2000. Both the CBI and CBTPA have been replaced by CAFTA-
DR.35 The Dominican government, along with the governments of Costa Rica, El Salvador,
Honduras, Guatemala, and Nicaragua, signed the CAFTA-DR with the United States on August 5,
2004. In July 2005, after a contentious debate and a close vote, both houses of the U.S. Congress
passed implementing legislation for the CAFTA-DR, which President Bush signed into law on
August 2, 2005 (P.L. 109-53, 119 Stat. 462). The Dominican Congress ratified the agreement in
September 2005 and implemented it on March 1, 2007.36
As a result of CAFTA-DR, the Dominican Republic has enacted a number of reforms to improve
its tax structure, strengthen intellectual property rights, and facilitate trade flows through the
country (customs reform). Perhaps partially as a result of these efforts, foreign investment in the
Dominican Republic has continued on an upward trajectory, growing by 157% between 2005 and
2008 before falling slightly in 2009. U.S.-Dominican trade, which reached record levels in 2008
(the year after CAFTA-DR took effect in that country), continued to flow at relatively high levels
in 2009 despite significant declines in global trade that occurred as a result of the global financial
crisis and U.S. recession.
The United States is the Dominican Republic’s main trading partner, with two-way trade totaling
more than $10.6 billion in 2008 before falling to $8.6 billion in 2009 as a result of the U.S.
recession and overall declines in global trade. The United States exported $5.3 billion in goods to
the Dominican Republic in 2009, with electrical machinery (12%) and oil (12%) among the
leading items. In the same year, the United States imported $3.3 billion in Dominican goods, with
knit and woven apparel accounting for roughly 25% of those imports. The Dominican Republic
was the 33rd largest export market for U.S. goods in the world and the largest export market
among the CAFTA-DR countries.
34 Gerardo Reyes and Jacqueline Charles, "Trafficking, Sexual Exploitation of Haitian Children in the Dominican
Republic on the Rise," October 23, 2010.
35 CRS Report RL33951, U.S. Trade Policy and the Caribbean: From Trade Preferences to Free Trade Agreements, by
J. F. Hornbeck;
36 For historical background, see CRS Report RL31870, The Dominican Republic-Central America-United States Free
Trade Agreement (CAFTA-DR), by J. F. Hornbeck.
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CAFTA-DR has only partly offset the difficulties of Dominican apparel companies based in the
country’s Free Trade Zones (FTZs), which have been struggling to compete with less expensive
textile goods exported from Central America and China. A new study shows the potential benefits
for the Dominican Republic of working more closely with the other CAFTA countries to build
supply chains that would be mutually beneficial.37 Similar export expansion may also occur if
Dominican companies launch more coproduction projects with Haiti in order to benefit from the
HOPE Act (P.L. 111-171) as amended.
Author Contact Information
Clare Ribando Seelke
Specialist in Latin American Affairs
cseelke@crs.loc.gov, 7-5229
37 U.S. Agency for International Development and Dominican Republic Ministry of Industry and Commerce,
Complementariedades y Encadenamientos Sectorales para la Producción de Bienes Exportables en los Países del DR-
CAFTA, July 2010.
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