‘The Dominican Repubic has a chance to carve out a niche’ | fDi Intelligence – Your source for foreign direct investment information

US-based energy firm AES entered the Dominican Republic in the 1990s, when the country was in the process of liberalising its energy market. Today, the company owns and operates the country’s only liquified natural gas terminal, 640 megawatts (MW) of gas-powered installed capacity to generate electricity, 150MW of renewable energy projects up and running and another 170MW in the pipeline. Edwin de los Santos, president of AES Dominicana, discusses the opportunity the country has to attract industries that not only need to friendshore, but source their power through sustainable means. 

Q: What are the opportunities and the challenges for the country?

A: I believe the disruption in global trade is a big opportunity for the Dominican Republic. Globalisation has been challenged and competitive advantage is something from the past. We are in the era of friendshoring.

Trust stands at the core of global trade in the future and the country has been shown to be a very solid democracy. In terms of challenges, it has to fix its problems with power distribution, as well as push for the development of informatic and linguistic skills to prepare the workforce for the type of investment that the country wants. 

Q: And which investment is that, specifically? 

A: The country has a chance to carve out a niche in sustainable manufacturing. The government has signed many renewable energy projects in the past three years.

That green power has to enter the industrial value chain. There are many firms around the globe that have decarbonisation targets and are in the process of friendshoring. The country is well positioned to attract those investments. 

Q: How would you assess the current business landscape in the Dominican Republic? 

A: It’s very positive. The relationship between investors and the government is constantly improving. Today, setting up a meeting with a government office is very easy, as is being heard when it comes to bringing new investment or airing concerns. In this context, private sector associations have played an important role and today there are several discussion tables open with the government. 

Q: To what extent can a future investment rating reduce the cost of investment in the country? 

A: When Panama achieved investment grade status in 2010, it gained more visibility and FDI increased substantially. With regards to energy, the difference in sovereign ratings explains why generation costs can vary from one country to another. The Dominican Republic has been working on the criteria to achieve investment rating for quite some time.