Overview

Over the last two decades, construction activity has shown remarkable growth in the Dominican Republic, reflecting the substantial investment by the GODR and the private sector. However, in 2024, the construction sector grew by only 2%. The increase in the prices of building products is one of the main reasons for the constriction of this sector; construction material prices rose significantly in 2024 (cement, steel, paint, etc.), increasing costs of housing construction and contributing to the slower growth. Other constraints have emerged or intensified, such as delays in permitting and approvals in 2024, which are being flagged by industry actors as hindrances to faster growth.

Although the sector did not grow much, the U.S. export value of building products to the DR showed growth of 10%. This result was driven by private investment for the development of important real estate projects of low- and medium-cost residential units, commercial establishments, and the expansion of installed tourist capacity, as well as the execution with public capital of the reconstruction and maintenance plans for land communication routes and urban improvement.

Among the main civil engineering works carried out by the GODR are the reconstruction of the highways of Nagua, Juan Pablo Duarte, and the expansion of the “General Gregorio Luperón” Tourist Highway that leads from Santiago to Puerto Plata. Likewise, projects were carried out for the construction of the Baní, Azua and Los Alcarrizos bypasses, the Santiago Monorail and expansion of the surrounding highways of the Cibao Region and others. Other improvements in the province of Santo Domingo include initiatives aimed at reorganizing transport, such as the expansion of Line 1 and the construction of Line 2C of the Metro, as well as the construction of the second line of the Cable Car of Santo Domingo, Santo Domingo Oeste and Los Alcarrizos.  

Additionally, the resources channeled through the financial system for the construction and acquisition of housing reached US$5.5 billion as of December 2023, 10.0% more than the previous year.

In the period from January-December 2024, the volume of national imports and sales of the main inputs of the construction sector presented an increase: paint (6.2%), cement (4.1%), asphalt cement (95.2%). For its part, income generated by the sale of other materials grew by 30.8%. 

At the end of the first quarter of 2025, overall construction activity registered a growth of only 1.2%.

The GODR and local banking institutions have created better financial and credit conditions, allowing the resumption of important works in the tourist, commercial, and residential sectors. Additionally, the increase in prices of the materials used in construction during the period had a significant impact. Likewise, the dynamics of this sector during the last six months of 2023 were supported by civil engineering and infrastructure works promoted by the Government for the maintenance of land routes, which included construction, reconstruction, and paving of highways, avenues, local streets, and roads in some areas of the country. 
 

Table: Market Size for Building Products, USD Millions

Unit: (Millions of U.S. Dollars)
Exchange rate: RD$63.00– US$1
Sources: U.S. Census Bureau, Economic Indicators Division, DR central Bank

The sector’s performance is associated with the resumption of important tourism projects, the reactivation of real estate projects for residential units, and the start of new programs to expand the number of low- and middle-income family homes in the market. Additionally, improvements to the local water supply and infrastructure have also played a key role.

U.S. products enjoy an import market share of approximately 20 percent in the local construction sector. Best sales prospects, at least for the short term, include products used in the construction of low-to-medium cost housing, shopping malls, and commercial buildings. Public works projects, such as highways, bridges, and marine ports also present short-term opportunities.

There is strong competition in this sector as companies from the United States, Asia, Europe, and various Central and South American countries attempt to develop business opportunities locally. In order of importance, the main selling points for building products are: 1) price, 2) quality, and 3) time to delivery.

The local building industry is open to foreign companies interested in selling their products in the Dominican market. The best way to enter the market is by finding a distributor who is familiar with the Dominican technical requirements and who can be as competitive and aggressive as the local firms already working with other foreign companies.

Since the DR is a member of CAFTA-DR, most U.S. manufactured construction materials enter the country duty free. CAFTA-DR gives U.S. companies a significant trading advantage over non-CAFTA-DR competitors. However, the openness of the market has not only favored U.S. companies because other countries have been aggressively entering the Dominican market, resulting in a significant increase in competition.

Leading Sub-sectors

Located in a tropical climate, the DR’s construction industry is not subject to seasonal fluctuations. With lower labor costs, Dominican home building techniques and materials can differ somewhat from those used in United States as Dominican houses in the cities are primarily made of cement. Metal and prefabricated structures are starting to be more widely used. In rural areas, where incomes can be very low, houses are commonly made of wood and corrugated galvanized zinc sheeting.  It is also important to note that in the past two years, Dominican builders having increasingly been incorporating green building techniques into their projects.

In major cities, interior finishing represents a significant market opportunity for U.S. building products. Most houses have ceramic tile floors; some may use parquet or even marble floors for upscale building apartments that are popular among the upper-class in Santo Domingo.

Best prospect products

•    Heavy Construction Equipment (including used)
•    High-end aluminum/ wood doors and windows 
•    Bathroom and kitchen fixtures
•    Wood lumber and wood products
•    Electrical fixtures
•    Lighting products
•    Plumbing (metal) and welding products
•    Roof products (sealers) 
•    Asphalt mixtures
•    Steel products
•    Prefabricated structures
•    Hand tools

Opportunities

The local building industry is open to foreign companies interested in selling their products in the Dominican market.  American products generally enjoy a very good reputation for quality and receptivity is high among those able to afford them.  

Domestic Production

The local industry produces cement, cement block, concrete, concrete mixes, tiling, mosaics, paint, and steel rebar.  In addition, there are locally manufactured PVC pipes and connectors, sanitary ware, tanks, wood doors and windows, metal windows and frames, fiber glass products, sanitary and gas installations, and some electrical accessories.

Construction firms targeting the middle- to upper- classes generally prefer imported building products because of the high quality.

Third Country Imports

According to experts, building products from other countries, especially those from China, Taiwan, and Central/South America, may not meet the same quality standards as the United States or European countries.  Nevertheless, imported products from China and South America have the most presence in the market.  Asian building products often have a price advantage for very cost-sensitive projects and are consequently widely used in government-funded projects such as hospitals, schools, and low-cost housing projects.
U.S. Market Position Share

U.S. companies have maintained a good position in the Dominican market, but they have not significantly increased market share in recent years, as the DR is a very price sensitive market. Many local end-users/importers have expressed concern that numerous U.S. companies have failed to make themselves available for potential local buyers. Meanwhile, suppliers from other countries are quite aggressive when applying their selling techniques.

Web Resources

•    Sheila Diaz de Andujar, Senior Commercial Specialist: sheila.diaz@trade.gov 
•    Ministerio de Obras Publicas y Comunicaciones – MOPC – (Ministry of Public Works and Communications 
•    Banco Central de la República Dominicana (National Central Bank) 
•    Colegio Dominicano de Ingenieros, Arquitectos y Agrimensores – CODIA – (Dominican Association of Engineers and Architects)