Financial Crime World

Dominican Republic Sees Emerging Risks in Financial Crime as Economy Recovers from COVID-19 Impact

Strong Recovery Expected in 2024, but Financial Crime Risks Loom

The Dominican Republic’s economy is expected to experience a strong recovery in 2024, driven by a boost in private credit and investments, as well as the resumption of remittances and exports. However, experts warn that emerging risks in financial crime could threaten this growth.

Key Economic Indicators

  • The country’s current account deficit narrowed in 2023 due to lower import bills and improved tourism receipts.
  • The consolidation of tourism and the slowdown in fuel imports are expected to stabilize the current account deficit in 2024.
  • The public deficit as a percentage of GDP is expected to remain unchanged in 2023 and barely decrease in 2024, with primary expenditure focusing on social transfers and subsidies.

Corruption Scandals and Power Struggles Pose Economic Risks

President Luis Abinader has announced his intention to seek a second term in office in the next general elections scheduled for May 2024, with a strong majority in Congress and high popularity ratings. However, experts warn that the country’s corruption scandals and power struggles could impact economic stability.

Tensions with Haiti Escalate

The Dominican Republic’s financial crime landscape is also becoming increasingly complex, with the country’s economy vulnerable to money laundering and other illicit activities. Experts warn that the lack of effective anti-money laundering (AML) and combating the financing of terrorism (CFT) regulations could exacerbate this risk.

Government Efforts to Address Financial Crime Concerns

The Dominican Republic has taken steps to address these concerns, including the adoption of new laws and regulations aimed at strengthening financial crime prevention. However, experts warn that more needs to be done to prevent and detect financial crimes.

Key Recommendations:

  • Greater coordination between the government, regulators, and law enforcement agencies is needed to address financial crime risks effectively.
  • Effective AML/CFT regulations are crucial in preventing and detecting financial crimes.
  • The country’s economy must prioritize financial crime prevention and detection to ensure a stable and secure economic environment.