The report outlines the macroeconomicstability in the Dominican Republic during the 1990s,suggesting its strong economic growth, and povertyreduction, will contribute to the gradual transformation thecountry is undergoing towards policy reform. It analyzespoverty, especially severe in rural areas, where misdirectedagriculture policies, and insufficient public investments,such as education, limit opportunities. But, the advancingtrade liberalization, is expected to reduce export taxes,and although displaced industrial, and agriculturalactivities will be subjected to adjustment costs, there willnonetheless be improvements in consumers' welfare, andreal wages. However, public resources for education remainvery low, particularly for secondary education, and thisshould be considered as key element of the government'spoverty reduction strategy, in addition to the establishmentof safety nets to curtail malnutrition, and expand health,and sanitation programs, to tackle the extreme poverty.Recommendations suggest, first, to reduce macroeconomicvulnerabilities, through tight fiscal, and monetarypolicies, and, second, implement reforms, to prod a businessenvironment, and, a strengthened banking sector, throughmarket, and regulatory mechanisms.
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