Dominican Republic Country Information Population: - 8,581,477 (July 2001 est.) Capitol: - Santo Domingo Other cities: -Santiago de los Caballeros (Santiago), La Romana Primary Language: - Spanish Date of Independence: -1865 GDP/capita: -purchasing power parity - $5,700 (2000 est.) – (has a highly skewed distribution of income, approx. two million Dominicans still live in poverty) Major colonial powers: -Spain, France Map of the Caribbean Map of the Dominican Republic Project goal: To explore the primary factors available to the Dominican Republic for its development Human Capital as a Factor of Development The population of the Dominican Republic, if well utilized may bring about significant economic and social growth. One way of taking advantage of this factor of development is through education. The accumulation of human capital through education: Today, many Dominicans in rural areas are unable to obtain a satisfactory tertiary education. – “Those able to achieve higher levels of education tend to migrate out of the rural areas leaving behind the most disadvantaged, creating in the process entrenched pockets of poverty.‖ –The World Bank Group Some figures relating to the state of D.R’s human capital. Pregnancy has become the leading cause of death among adolescent girls in the Dominican Republic [according to the United Nations Population Fund (UNFPA)]. Nearly 25% of girls aged 15 to 19 are either pregnant or have already given birth, yet access to reproductive health services is limited outside the major cities, putting these young mothers at risk. Public expenditure on education • As a % of GDP: 2.2 • As a % of total government expenditure: 13.8 Poverty Reduction and Education Today, almost 85% of poor household heads have not completed primary education. Almost 30% of poor household heads have no education whatsoever, facing enormous opportunity constraints even within a growing economy. While the educational attainment of the younger generation is higher than that of their parents, enrollment in secondary education remains low, when compared to other middle income countries. Poverty Reduction and Education (Cont’d) Throughout the 1990s the returns on education for workers who have only attained primary education remain low. • This trend is likely to continue given the strong influx of Haitian immigrants, providing low-skilled labor with low reservation wages. Significant poverty reduction will involve a focus on areas of public policy such as: – education, adequate provision of property rights, and family planning. EDUCATION Structure of the Educational System – Primary School lasts for 6yrs and is compulsory – In secondary education two systems are in operation • Traditional System- consists of a 6yr cycle divided into a two-year intermediate cycle and a four-year second cycle • Reform system- studies last for six years, divided into two cycles. The first cycle (Ciclo Básico) is a four-year cycle with an emphasis on science. The second cycle (Ciclo Superior) lasts for two years and offers a greater choice of specializations than the traditional system. EDUCATION OVER THE LAST DECADE In the last decade, educational reform activities in the Dominican Republic have resulted in increased enrollments, a reduced dropout rate, and greater access to education for low-income children. Equity remains a challenge: – Particularly for children in rural areas where where grade repetition and drop-out rates are higher than in urban areas. What does the Dominican Republic need to improve its education system? Increased public and private sector expenditures on education NOTE: Only this month the IDB(Inter-American Development Bank) approved an $80 million loan for a basic education program in the Dominican Republic. Purpose of the loan: -To support the first phase of a program to improve equity in basic education in the Dominican Republic by focusing on schools and students in rural and marginal urban areas. Seer’s Model for Development According to Seers, the term development must take into consideration 3 factors – Inequality – Poverty – Unemployment In the case of the Dominican Republic and the Caribbean on a whole, any factors that are expected to “develop” the country or region must, according to Seers, have a positive impact on these 3 aspects of development. Education as it relates to development The more educated a country’s people are, the brighter its future. – An educated population attracts FDI (foreign direct investment) – increased investment in education contributes to economic efficiency and equity. – investment in the human capital of the poor is one of the most important tools for reducing poverty. Links between education, women and development Educated women have smaller families, fewer of their children die in infancy and the children who survive are healthier and better educated. Educated women are better equipped to enter the paid labor force. This is critical to the survival of the many female headed households of the Caribbean. Nations with higher levels of female school enrollment in the past, today show higher levels of economic productivity, lower fertility, lower infant and maternal mortality, and longer life expectancy than countries that have not achieved as high enrollment levels for girls. Are Women a Factor for Development in the Dominican Republic? Gender in the Labor Force: – Women are not educated in technical fields related to agriculture and industry – The men are educated so as to be hired for supervisory or professional positions Gender in the Labor Force Cont’d Women will earn an income that can and will support their children and their husband They are not earning wages that can support the entire family Quote from a Dominican Working Woman One woman states… ― I eat lunch [the Dominican main meal] every other day, since I have no money… besides, who could eat knowing the children are home with nothing. I must lock the children in the house during the [12 hour] workday to keep them safe, with no one to look after or feed them. My eldest should be in school, but she must see to the little ones… even in my one-room shack the three year old gets in trouble. (Interview by Laura Raynolds 20, December 1989) Gender in the labor force cont’d Although agricultural work is considered to be primarily carried out by men, the women who work to feed their families see that ―they are fundamentally redrawing the parameters of ―women’s work‖ and establishing a potential basis for increasing women’s economic autonomy‖. (Raynolds) In ―Sun, Sex, and Gold: Globalization, Tourism, and the International Sex Trade‖, ― A number of writers have pointed out that despite the economic independence of Jamaican Women and matrifocality of many households, men are still perceived to be the dominant of the sexes‖ ( Senior 1991, Powell 1986, Moses 1977). -This is in comparison to the sex industry of Jamaica, but it still reestablishes the idea of female and male inequalities. Gender in labor force cont’d Women are the primary factor in the work force, because they perform most of the labor and yet they are not rewarded for their work with higher income so they can support their family – This is a result of… ― Companies profit from Dominican patriarchal traditions that limit women’s alternatives and make them disproportionately responsible for home and family‖ (Raynolds). Gender in the labor force cont’d. The new jobs being created are strictly based on gender Men are able to have an education they are given the professional positions in the work place And YES, women do continually work in the labor force, because… Their income is restricted They are continually having more children, which increases the need for what little income they do receive Women make up most of the agricultural and industrial labor forces, without them production would be moving at a slower rate Women’s issues that hamper development. Women are constantly victims of Domestic Abuse Here are some statistics: – Between November 1st 2000 and October 31st 2001 104 women were murdered, 62 were murdered by a spouse, and 20 of those had been women who previously reported domestic violence, but no help had been given – The year before 86 women were murdered – Murder is the 6th cause of death for Dominican women ages 15 to 45 – 1 in 6 homes experience violence – Due to Domestic violence 80% of women are in who need of health care – 40 to 50 reports of violence are given to the Santo Domingo Police Station daily. (In a year this totals 10,800 reports) Results of the Project BUT, as a result of these horrendous statistics two major issues have been addressed to create new developments for the Dominican Republic A project was created resulting in… The government passing amendments to the Dominican Penal Code in 1997 It also united 4 major NGO’s in the Dominican Republic (CEDAIL, CENSEL, FISOE, CEPLES) They are now working together to promote a better understanding of women’s issues to ensure that women are treated fairly in the home Industry: key words and phrases Free trade zone: an area within a country regarded as being outside its customs territory—exempt from custom duties and taxes Nontraditional agriculture: 1) all agriculture exports except sugar, coffee, cocoa, and tobacco 2) agro-industrial commodities for local and export markets Sex tourism: ―any travel experience where the provision of sexual services by the host population in exchange for monetary and nonmonetary rewards makes a significant contribution to the enjoyment of the holiday itself‖ (Mullings) CBTPA: Caribbean Basin Trade Partnership Act—‖significantly expands preferential treatment for apparel made in the Caribbean Basin region‖ (Export Advantage) Imports and Exports of Textile and Apparel Production Imports: – Cut apparel parts (pre-made) – The U.S. accounts for 85% of Dominican textile imports • Taiwan, China, Hong Kong, Mexico, and South Korea Commodities: foodstuff, petroleum, cotton and fabrics, chemicals and pharmaceuticals Textile and Apparel Production (cont.) Exports – Consist largely of finished garments for the U.S. market – Largely assembled in free trade zones for export – Export partners of the D.R. are: U.S. 87.3%, Netherlands 1.1%, Canada 0.7%, France 0.7% (2000 est.) Momsen: produces what it doesn’t consume, consumes what it doesn’t produce clothing, food, tourism, etc. Industries: Tourism, Agriculture, and Apparel Industries: tourism, sugar processing, textiles, tobacco Tourism has replaced sugar as country’s leading foreign-exchange earner in 1984 Labor force by occupation: services and gov’t 58.7%, industry 24.3%, agriculture 17% (1998 est.) Andreatta: tourism, credit card processing, offshore banking, and other high tech industry are moving in [to the Caribbean] Where the success of industry lies Success in exporting: low cost labor resources – 20 years success in garment assembly – of the 34 electronic firms in the D.R., 30 produce goods SOLELY for export • 90% produced for the U.S. AGRICULTURE Traditional export crops are: 1) Sugar 2) Coffee 3) Cocoa 4) Tobacco The country’s agricultural sector has moved away from sugar and other traditional crops, with increased production and export of non-traditional crops. Non-Traditional Export Crops are: 1) Pineapples 2) Citrus 3) Melons 4) Mangoes Agricultural areas are found in the East and Santiago. Agriculture was the backbone of the Dominican economy for centuries. It declined significantly during the 1970s and the 1980s, as manufacturing, mining, and tourism began to play more important roles in the country's development During the 1960s, the agricultural sector employed close to 60 percent of the labor force, contributed one-quarter of GDP, and provided between 80 and 90 percent of exports. By 1988, however, agriculture employed only 35 percent of the labor force, accounted for 15 percent of GDP, and generated approximately half of all exports. The declining importance of sugar, the principal source of economic activity for nearly a century, was even more dramatic. Sugar's share of total exports fell from 63 percent in 1975 to under 20 percent by the late 1980s. The transformation in agriculture paralleled the country's demographic trends. In 1960, some 70 percent of the country's population was rural; by the 1990s, upwards of 70 percent was expected to be urban. Government policies accelerated urbanization through development strategies that favored urban industries over agriculture in terms of access to capital, tariff and tax exemptions, and pricing policies. As a consequence, the production of major food crops either stagnated, or declined, in per capita terms from the mid-1970s to the late 1980s. Lower world prices for traditional cash crops and reductions in the United States sugar quota also depressed the production of export crops in the 1980s. http://memory.loc.gov/cgi-bin/query/r?frd/cstdy:@field(DOCID+do0056) Data as of December 1989 CONTRACT FARMING What is Contract Farming? It is production by smallholders for private corporations. Contract farming commits household land and labor resources to the production of a commodity that is ultimately controlled by an agro industrial firm. Contract Farming is linked to the increasing consumption of processed foods and the declining capacity of the state to provide credit and other inputs to peasant producers. Process of Contract Farming The purchaser enters into a formal agreement with the grower to buy the farm output prior to production. In return for the production the grower agrees to abide by rules over sighted of the purchaser. In other words the Purchasers provide the capital and services and the growers provide the land and labor. Disadvantages of Contract Farming 1) The Producers are subordinated to “management”, so we have a proletarian and bourgeois scenario. There is a “disguised wage labor” present. 2) It’s not an individual that is involved in this type of farming but the entire family. 3) Traditional crops have declined with the increase of non- traditional crops. 4) The use of pesticide, chemical fertilizers and mechanical cultivation has increased dramatically. (Example of the Tomato Production) 5) Growers are experiencing more debt because of these changes. WOMEN IN AGRICULTURE The expansion of non-traditional crops has increased the labor market in the Dominican Republic. It has been encouraging to the women labor force. As result women play a predominant role in the production of these new crops. Women are in the background of the peasant agricultural work. They do the harvesting and post harvesting crop handling which generally get no pay. In 1985 14% of Dominican Women were employed in agriculture. Women constitute to 42% of the paid nontraditional agriculture labor force. The majority of women are involved in the production of fresh produce exports. For example, melon, pineapple, avocado and other fresh fruit and nut enterprises. They rely heavily on women’s labor. For example, women constituted for over 55% of the workers on the pineapple plantation. AGRICULTURE & TOURISM Tourism can influence agriculture in 5 interrelated ways: It can offer alternative employment opportunities and therefore raise the reserve price for agriculture labor and encourage migration from farming to tourist areas. Competition for land between recreation and agriculture may raise land values and so remove some agricultural land from food production. Tourist activities may modify land use values around resort areas Tourist demand for high-value and quality food may provide incentive for farmers to increase and diversify production or increase food import Tourism may create aesthetic uses for rural land, encouraging preservation of some rural environments and creating associated recreation – based jobs in rural areas. History and Development over the years: tourism -Prior to 1967, more Dominicans traveled abroad than foreigners came to visit the country. -In 1970, INFRATUR was developed to monitor and to invest directly in tourist-related infrastructure projects. -Multiple devaluations of the peso created a tourism product that was unbeatable in price. History and Development (cont’d) -By 1984, tourism replaced sugar as the country’s leading foreign – exchange earner, exemplifying the growing diversity of the Dominican Republic economy. -By 1989, it boasted more than 18,000 hotel rooms – more than any other location in the Caribbean. -The number of tourists visiting the island increased from 278,000 in 1975 to 792,000 in 1985 and in 1987 the number of vacationers surpassed 1 million for the first time. Income from Tourism Tourist Numbers - The majority of tourists come by air and stay for at least a week (Europeans average two weeks) Arrivals The Dominican Republic is the most popular Caribbean destination for Europeans, and they make up 46% of its overnight visitors. In 1997, the countries sending the largest number of tourists were: § United States 402,039 § Germany 328,860 § United Kingdom 216,790 § Canada 152,777 § Italy 118,551 § Spain 106,398 § France 57,507 § Belgium 46,590 § Austria 36,753 Who owns the Hotels? -Although some foreign-owned hotel chains began investing heavily in the early 1970s (such as Gulf and Western with the luxury Casa de Campo), the industry’s development was primarily made possible by domestic investors. -In 1987, only 21% of hotel rooms were estimated to be foreign owned. Is the Income staying within the country? -Because the majority of the hotel chains are domestic owned, the majority of the income is kept within the country. However for the approximately 25% foreign owned hotels, this amount goes out of the country. Benefits of Tourism - Tourism offers higher wages - Tourist industry employs a number of workers which provide employment for a significant percentage of the country’s population - Access to foreign currencies - Makes a substantial contribution to the country’s GDP - casinos bring in a high amount of visitors and hence some foreign exchange Problems associated with Tourism (A) Environmental -Inadequate supplies of clean water -Electricity -Soil eroding into the sea damaging the coral reefs -deforestation -irreplaceable damages from Hurricane George crime B) Other Sex tourism Plans to Improve Tourism -The Government has put measures in place to ensure that tourism development and environmental management are mutually supportive. It has also adopted integrated planning policies and promoted public awareness/education for sustainable tourism. The Government has formulated policies for general tourism, eco-tourism and cultural tourism, but there are no marine-based tourism policies at this time. The Government has also expressed its support in this area by joining in the Declaration of the Caribbean Sea as a Sustainable Tourism Region. Public participation has been developed as a tourism management strategy, and the development of regulatory measures has occurred. The Government has not adopted measures to protect the cultural integrity of the Dominican Republic; however, local ownership within the tourism sector has been encouraged. The Government has not yet provided incentives within the tourism industry for the use of sustainable technology with respect to energy, water resources or waste disposal, but it has been supportive to hoteliers engaged in these efforts.