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12 Things You Didn’t Know About the Dominican Republic

December 20th, 2010

By Dennis Barker

dominican republic facts 300x1671 12 Things You Didnt Know About the Dominican Republic Known to much of the world for sugar and beautiful beaches that look like sugar, the Dominican Republic continues to develop its role as a service provider to the rest of the world. In fact, the services sector now generates more revenue than agriculture (and would be an even bigger sum if you factored in the salaries of Major League Baseball players born here).

The government appears committed to growing the call center industry, and business is responding. The DR is a country with great opportunities but also, along with its top trading partner to the north, great challenges. Here are some facts we hope shed a little light on this Nearshore contender.

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Caribbean King of Call Centers

The Dominican Republic continues to hold the title of the Caribbean’s call center champion, edging out Jamaica and earning praise from major in-country providers like Stream Global Services and Provitel. With more than 65 call centers, the sector is second only to tourism in growth, generating 40 percent of revenue for the overall DR economy. The call center industry has created around 25,000 direct jobs so far. “The DR has the largest concentration of U.S.-certified personnel in the entire region, way above Jamaica, Puerto Rico, Colombia, Guatemala, and Nicaragua,” says Jean Luis Caamaño, president of the Contact Center Association of the DR.

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Labor Costs Are Among the Lowest in the Region

The average entry-level call center or BPO employee is paid in the range of $7,000 a year. That employee's mid-level manager is paid about $12,000 a year. In, say, Jamaica, that employee would be making about $10,000, and the manager, about $15,000. * according to the Contact Center Institute of the Americas

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As a Place to Do Business, the DR Keeps Getting Better

Continuing an upward trend, the Dominican Republic was ranked No. 69 by Forbes on its most recent list of Best Places to Do Business. Last year, it was ranked 76, and the year before, 79. The service sector — think call centers, tourism, and a bit of BPO — has overtaken agriculture as the leading employer. The government has set up free trade zones and offered other economic incentives, and that has helped boost the services side. GDP growth was strong from 2005 through 2008, but has lately taken a hit from the major recession in the U.S. (where about 60% of DR exports go). The poorest 50% of the population receives less than one-fifth of GDP, Forbes says, while the richest 10% hauls in nearly 40% of GDP.

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It's a “Medium Risk” Location

ORC Worldwide, an international HR firm, ranks cities according to the level of “hardship” they will impose on foreigners sent by their employer to manage operations there. ORC considers criteria such as crime, disease, pollution, political violence, and availability of goods and services. In a report compiled recently for Businessweek, ORC ranked Santo Domingo No. 20 out of 55 cities and rated it “medium” on the risk scale. “While the pleasant environs of the Caribbean are a plus, hurricanes, power failures, poor roads, crime and the threat of disease are drawbacks to this location,” says ORC. Nearshore neighbor Bogota, Colombia, came in at No. 8, a “high risk” location.

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It's Also a Major Golf Location

But obviously not everyone agrees with the ORC. Hundreds of thousands of tourists flock to the DR beaches and lush tropicalia every year, and investors are responding by funding new luxury resorts and golf courses. The postcard-perfect Punta Cana area already features 12 professional golf courses, designed by such luminaries of the links as Jack Nicklaus, P.B. Dye, and Tom Fazio, with more courses in the works. Guys who like to hit that little white ball around will recognize names like La Cana, Punta Espada, and Teeth of the Dog.

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Nearshore Trade War! DR vs. Costa Rica

Costa Rica is trying to put a “straitjacket” on DR trade, the head of the DR National Business Council recently charged. The two nations have been arguing over tariffs on industrial products from CR — such as polypropylene sacks — and have taken the dispute to the WTO. CR says DR is violating CAFTA-DR regulations. DR representatives said they were taken aback by a Costa Rican official's comment that if the DR wants closer ties with Central America, they had better learn “that here the treaties are enforced either in a nice way or not.”

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Stealing Electricity Is a Crime

Outages are fairly common in the Caribbean. But in the DR, the electricity system is plagued by “high distribution losses” — third worst in the world, according to the World Bank. “Due to low collection rates, theft, infrastructure problems, and corruption, distribution losses remain high,” says the U.S. State Department. In 2007, the DR Congress passed a law criminalizing the theft of electricity. Meanwhile, a new study says the Dominican Republic has the potential to generate around 10,000 megawatts of wind energy. (Current output using conventional fuels is around 3,000 mW.)

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Infrastructure Not as Attractive to Investors

The country lags behind other Nearshore nations in terms of the attractiveness of its private investment climate for infrastructure, says the World Economic Forum. The DR comes in at 12th on the list, placing it behind Chile, Brazil, Colombia, Peru, Mexico, Uruguay, El Salvador, Guatemala, Argentina, Venezuela, and Bolivia. The organization looked at dozens of variables, including the legal framework, political risk, willingness to pay, and macroeconomics. The DR scored highest in the number of projects cancelled (48% between 1990-2005). DR scored better in terms of general investment, ranking 8th.

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Baseball Is in the DNA

Between 1962 and 2008, one town alone, San Pedro de Macoris, produced 79 major league baseball players. New York City, with a population 27 times larger, in that same time period produced 129. Major League Baseball would look like minor league baseball without the presence of Dominicans. Current players David Ortiz, Albert Pujols, José Reyes, Hanley Ramirez, Robinson Cano, and Alfonso Soriano, future Hall of Famer Pedro Martinez, plus the Alou brothers and Juan Marichal, make up just a small squad manifesting the island's baseball genetics. Most MLB teams now have player-development people dedicated to scouting the local baseball academies.

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There's an Educated “Elite”

Access to primary education is rated poorly, among the 15 worst countries in the world, according to the Legatum Prosperity Index report. Access at the secondary level is also below the international average, for a ranking of 75th, Legatum analysts say. However, the average Dominican worker has taken an above-average one year of tertiary education, making for a “relatively significant graduate elite.” There are more than half a million “professionals with diplomas of higher education” as well as a disproportionately high number of certified professionals in the service sector. There are 60 English-language institutes and 15 multilingual institutes.

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The DR Was Nearly a U.S. Territory

Since C. Columbus landed here in 1492, the country has had its share of attackers, invaders, and foreign occupiers — and we don't mean pasty-skinned tourists. First Spain, then France. Then neighbor Haiti in 1801. The Haitians were eventually thrown out, only to return in 1822. U.S. Marines took over from 1916 to 1924. And in 1965, concerned that the DR would go the way of Cuba and Castro, the U.S. again sent in the Marines. That might not have happened had the DR become a territory of the U.S. In 1870, President Báez petitioned to have his country annexed, but the motion failed in the U.S. Senate by one vote.

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Best Time to Check Out That New DR Location: February

Let's say you've been asked to investigate a call center operation in the Dominican Republic. What better time than February, when local temps are in the 70s-80s (F)? Can you help it if it's also carnival month? Festivities take place every Sunday: parades, dancing, music, partying, and celebration of traditional Taino culture. But remember: First thing Monday morning might not be the best time to schedule a meeting.

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Posted on Monday, December 20, 2010  
Filed under News & Analysis · Tagged , ,

Comments

One Response to “12 Things You Didn’t Know About the Dominican Republic”
  1. Mical Cooke says:
    February 23, 2011 at 7:35 pm

    Is David Campone working for you? David and I worked together and I would love to talk to him regarding possible employment with your company. I have 20 years callcenter management experience.

    Thank you and I would love to hear from you.

    Mike

    Reply

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