2016年-世界发展银行全球_Special_Economic_Zones_in_the_Dominican_Republic___Policy_Considerations_for_a_More_Competitive_and_Inclusive_Sector_34页_631kb

Summary of "Special Economic Zones in the Dominican Republic: Policy Considerations for a More Competitive and Inclusive Sector"

Core Content

This report evaluates the role and impact of Special Economic Zones (SEZs) in the Dominican Republic, focusing on their contribution to economic growth, employment, and integration into Global Value Chains (GVCs). It provides an empirical analysis of the structural changes in SEZs, the evolution of domestic linkages, and the effects of regulatory reforms aimed at aligning with World Trade Organization (WTO) rules. The report also offers policy recommendations to enhance the inclusiveness and sustainability of SEZs in the Dominican Republic.

Main Findings

1. Historical Role of SEZs

   • SEZs have been a key driver of economic growth in the Dominican Republic since the 1960s.
   • They have historically attracted foreign direct investment (FDI) and promoted job creation, especially in the garment sector.
   • The number of industrial parks has grown significantly, with 60 parks operating in 2014 and an average of 11 firms per park.
   • Most SEZs are privately managed (70%), with a smaller share managed by the public sector (25%).
   • SEZs have evolved from being primarily focused on low-skill, labor-intensive garment manufacturing to more diversified sectors such as electrical products, medical equipment, and pharmaceuticals.

2. Structural Shift and GVC Participation

   • The end of the Multi-Fiber Agreement (MFA) in 2005 and the signing of the CAFTA-DR agreement led to a shift from clothing to more medium-high skill manufacturing.
   • SEZs now play a central role in the Dominican Republic's participation in GVCs, with exports becoming more complex and value-added.
   • Upstreamness of SEZ exports has slightly declined, indicating a shift towards final product assembly, while intermediate imports have moved upstream, reflecting increased integration into more sophisticated production stages.
   • Despite this, SEZs remain heavily reliant on imported inputs, with 81% of inputs acquired abroad as of 2012.

3. Domestic Linkages

   • Domestic linkages between SEZs and local firms have not significantly increased, limiting the potential for economic upgrading.
   • The lack of domestic sourcing and supply arrangements suggests that SEZs have not effectively integrated with the broader domestic economy.
   • There is a need for policies that foster stronger linkages, such as creating a suppliers’ database and organizing matchmaking events.

4. Impact of Regulatory Reforms

   • The removal of export share requirements (ESR) in 2011, as part of WTO compliance, made SEZs more attractive to firms.
   • This reform supported the migration of firms from the national regime to SEZs, enhancing their competitiveness.
   • However, the fiscal costs of this policy need to be carefully measured.

5. Labor Implications

   • The shift to more sophisticated manufacturing has reduced the labor intensity of SEZs, potentially decreasing job creation.
   • Female labor participation in SEZs has declined since 2011, reflecting the decline of the garment sector and the rise of more skill-intensive industries.
   • Wages in medium-high skill sectors have increased, but real wages in the textile sector have declined due to economic crises and competition.

Key Policy Recommendations

• Enhance Domestic Linkages:

  • Create a suppliers’ database.
  • Organize matchmaking events between SEZ firms and domestic suppliers.
  • Develop local clusters around SEZs to foster collaboration and knowledge sharing.

• Support Labor Transition:

  • Implement vocational training programs for new skills required by SEZ firms.
  • Provide job search assistance and transitional income support to workers affected by the shift in sectoral composition.

• Improve Institutional Framework:

  • Revise the regulatory and institutional support framework for SEZs to ensure consistency and coordination between public and private actors.
  • Strengthen the role of the Consejo Nacional de Zonas Frances Especiales (CNZFE) in promoting SEZs and attracting investment.

• Conduct Cost-Benefit Analysis:

  • Perform a thorough cost-benefit analysis of SEZs to evaluate their impact on jobs, domestic linkages, and tax revenue.
  • Ensure that policy interventions are cost-effective and ideally shared between workers and employers.

Conclusion

The Dominican Republic's SEZs have historically played a crucial role in economic growth and FDI attraction. However, recent structural changes and the decline in the garment sector have raised concerns about their ability to sustain employment and foster inclusive growth. The report emphasizes the need for new policies that enhance domestic linkages, support labor transition, and improve the institutional framework to ensure the long-term competitiveness and inclusiveness of SEZs.