US-Dominican Republic trade tariff dispute

The United States imposed a 12.5% additional tariff on various Dominican products, including medical devices, pharmaceuticals, textiles, tobacco, and plastics. This measure created a competitive disadvantage for Dominican exporters compared to Central American competitors, who face a lower 10% rate. Business leaders and the Dominican Revolutionary Party warned that the tariffs could lead to job losses in free trade zones and prompt companies to relocate production to countries with lower costs.

In response, Senator Félix Bautista submitted a bill titled the ‘Law for the Prevention and Prohibition of the Importation of Goods and Products Produced Through Forced Labor.’ The legislative proposal aims to provide a legal framework to demonstrate to the United States Office of the Trade Representative (USTR) that the Dominican Republic has effective mechanisms to prevent forced labor. Bautista noted that the 2.5% tariff discrepancy negatively impacts competitiveness, particularly in the medical device and pharmaceutical sectors, where approximately 40 companies exported 72.2% of their production to the U.S. in 2025. He has called on President Luis Abinader to expedite the bill’s approval.

Adding to the political pressure, the Fuerza del Pueblo (FP) party has criticized the government for failing to secure more favorable terms. José Peña Santana, head of the party’s Secretariat for Foreign Trade and International Business Logistics, claimed the 12.5% rate could have been avoided through better diplomatic and commercial management. He specifically criticized the General Directorate of Customs (DGA) for failing to provide timely alerts to the Executive Branch regarding developments in Washington.