COMMERCE
Exports and imports.--Foreign trade.--Trade with the United States.--
Ports of entry.--Wharf concessions.--Domestic trade.--Business
houses.--Banks.--Manufactures.
The fact that Dominican commerce has more than trebled in twelve years
demonstrates the epoch-making character of the fiscal convention with
the United States. The trade figures since 1905 are as follows:
GROWTH OF DOMINICAN TRADE
(All figures are in American currency)
Imports Exports Total
1905 $ 2,736,828 $ 6,896,098 $ 9,632,926
1906 4,065,437 6,536,378 10,601,915
1907 4,948,961 7,628,356 12,577,317
1908 4,767,775 9,396,487 14,164,262
1909 4,425,913 8,113,690 12,539,603
1910 6,257,691 10,849,623 17,107,314
1911 6,949,662 10,995,546 17,945,208
1913 8,217,898 12,385,248 20,603,146
1913 9,272,278 10,469,947 19,742,225
1914 6,729,007 10,588,787 17,317,794
1915 9,118,514 15,209,061 24,327,575
1916 11,664,430 21,527,873 33,192,303
The increase in 1916 over 1915 was almost as much as the entire trade
of the country in 1905. The temporary setback of 1909 was caused by
the partial failure of the cacao crop and the paralyzation of
commerce in anticipation of lower tariff rates. That of 1914 was due
to the European war and a domestic revolution. Santo Domingo has,
however, repeatedly presented the anomalous spectacle of showing
enormous trade figures in the midst of warfare, as for example, in
1912. The advance in commerce has been especially marked since the
presence of the American troops assured peaceful conditions.
Not a year has passed since 1904 without a large balance of trade in
favor of Santo Domingo. While the greater part of this is represented
by huge sugar profits which have gone to foreign investors, a
considerable portion remained in the country. The great increase in
wealth since 1904 is apparent to anyone who knew the country at
that time.
The imports cover the wide range to be expected in a nonmanufacturing,
agricultural country in the tropics. The principal imports in
1916 were:
Cotton goods $1,721,534
Iron and steel manufactures, including sugar machinery 1,562,367
Rice 1,080,068
Wheat flour 621,900
Provisions, meat and dairy products 530,195
Oils 545,284
Bagging and other manufactures of vegetable fiber 508,644
Vehicles and boats 408,832
Manufactures of leather 385,518
Wood and manufactures of wood 317,421
Codfish and other preserved fish and fish products 309,204
Chemicals, drugs and dyes 293,072
Soap, and ingredients for the manufacture of soap 233,991
Paper and manufactures of paper 171,706
Beer 168,901
Agricultural implements 121,830
The United States furnished practically all the flour and other
breadstuffs, oils, lumber, agricultural implements and leather
articles and most of the cotton goods, hardware, machinery, fish, meat
and dairy products. Before the European war all the rice was bought in
Germany, as well as a considerable portion of the fish, beer, meat and
dairy products. At present the rice is brought from the United States
and England. The other imports from England are almost entirely cotton
goods and bagging, with some iron and steel manufactures.
In the chapter on the flora of the country, statistics are given with
reference to the exports of the country, which are, as there pointed
out, principally: sugar, cacao, tobacco, coffee, bananas, beeswax and
honey, hides, cotton, hardwoods and dyewoods.
Owing to its geographical position the United States naturally has the
greater part of Dominican trade, but since the European war set the
commerce of the world awry that proportion has grown until in 1916 the
imports from the United States, including Porto Rico, were 90.4 per
cent of the total and the exports to the United States and Porto Rico
were 82.8 per cent of the total, though the latter figure varies
somewhat from final destination, as much of the sugar and cacao is
shipped subject to order. Before the European war something more than
one-half of the trade of Santo Domingo was with the United States,
one-fifth with Germany, and the remainder with France, England and
other countries. The countries of origin of imports and destination of
exports of the Dominican Republic in the year 1916, as compared with
the list for 1913, the last preceding normal year, are here shown:
DOMINICAN TRADE BY COUNTRIES
IMPORTS
1913 1916
Value Percentage Value Percentage
of whole of whole
Cuba $ 7,352 .08 $ 136,587 1.17
France 274,318 2.96 152,358 1.30
Germany 1,677,833 18.10 ---- ----
Italy 173,105 1.87 63,450 .54
Porto Rico 62,900 .67 378,219 3.24
Spain 210,781 2.27 151,451 1.30
United Kingdom 730,191 7.88 481,305 4.13
United States 5,769,061 62.22 10,162,698 87.13
Other Countries 366,737 3.95 138,362 1.19
Total $ 9,272,278 100.00 $11,664,430 100.00
EXPORTS
Cuba $ 27,536 .26 $ 19,447 .09
France 887,907 8.48 287,799 1.34
Germany 2,068,384 19.76 ---- ----
Italy 20,430 .19 2,496 .01
Porto Rico 28,994 .28 425,483 1.98
United Kingdom 241,810 2.31 105,107 .49
United States 5,600,768 53.49 17,412,088 80.88
Other Countries 1,594,118 15.23 3,275,543 15.21
Total $10,469,947 100.00 $21,527,873 100.00
Very interesting statistics with reference to all these matters are
published annually in the report of the general receiver of Dominican
customs. Since the establishment of the receivership full and accurate
trade statistics have become available for the first time in the
history of the Republic. Before 1891 no statistics at all were kept.
During the nineties there was an attempt at compilation, but the
corruption in the custom-houses was so notorious that the figures
cannot be regarded as reliable. For the disturbed years immediately
following the death of Heureaux the data are incomplete and uncertain.
The question of shipping has been a serious problem confronting
Dominican commerce since the beginning of the European war. Freight
rates are rising to almost prohibitive figures, which have their
effect in an enormous increase in the cost of living, Santo Domingo
has as much reason as the rest of the world to desire an early
cessation of the world calamity.
After the war the old trade rivalry will be revived, but American
commerce with the Republic should easily retain its lead, if properly
cultivated. The observations so frequently made with reference to the
extension of American trade with South America also hold good in the
case of Santo Domingo. American merchants should send as
representatives cultured men who speak Spanish; they should provide
catalogs in good Spanish with accurate descriptions of the articles
offered; they should fill orders as received, without substituting
other articles; they should pack their shipments very carefully and
with a view to local transportation conditions. The success of the
Germans in building up their Dominican trade was due in large measure
to the polish and fluent Spanish of their representatives, to their
thorough study of local conditions, and to their favorable terms
of payment.
American commerce with Santo Domingo would be further stimulated and
strengthened by a tariff reciprocity agreement similar to the customs
convention between the United States and Cuba. The mutual advantages
of such an agreement would be enormous and the development of Santo
Domingo would be effectively promoted. Closer relations would also be
fostered by a postal convention applying the domestic rates of postage
to all mail between the two countries, a good beginning having been
made by a recent arrangement applying the domestic postage rate to
letters between the United States and the Dominican Republic.
The Dominican Republic has twelve ports of entry, but nine-tenths of
the foreign commerce goes through the ports of Macoris, Santo Domingo,
Sanchez and Puerto Plata. The first two supply the import and export
requirements of the southern portion of the Republic, the other two
those of the Cibao. The other eight custom-houses exist for local
convenience and for the prevention of smuggling. This is especially
true of the three along the Haitian frontier. In former years there
was considerable smuggling across the border, as the import duties on
certain articles in Haiti are much lower than in the Dominican
Republic. Although the profitable smuggling business demoralized trade
in those regions, the government did not interfere with it owing to
the difficulty of policing the wild and sparsely populated border
district. The American general receiver determined that the back door
should be guarded as well as the front entrance, and formed a frontier
guard which stopped contraband traffic, though at a heavy cost, for
two brave American officials have been killed and three wounded by
smugglers and outlaws, while fourteen Dominican guardsmen and
inspectors have been killed and twenty-three wounded. The expense of
the three frontier custom-houses is greater than the revenue they
produce, but entries in Azua, Monte Cristi and Puerto Plata increased
significantly after the frontier guard began its patrolling.
Incidentally the guard has helped to keep the boundary line in place.
In the seaports most of the loading and unloading is done by lighters,
the wharves generally being small affairs. Only in Puerto Plata (where
extensive harbor improvements are now under way), Macoris and Santo
Domingo can larger vessels approach the wharves. All the wharves were
built under concessions from the government, which, in the
impossibility to provide them itself on account of its perpetual lack
of funds, was obliged to procure their construction by granting the
right to collect a specified wharf tax, more or less onerous, for a
period of years. The Santo Domingo City wharf concession provided that
everything exported from and imported into this city or any other
coast point in the province must pay the tax, whether the wharf was
used or not. The Samana wharf concession; as amended, gave the right
to collect certain high wharf taxes for fifty years, from 1875 to
1925, in return for the building of a diminutive dock. One of the
important objects accomplished through the 1907 bond issue was the
redemption by the government of the monopolistic wharf concessions.
A peculiar feature of the country's domestic trade is that almost
fifty per cent of it is in the hands of Syrians. These people are
found in a number of the West India Islands, but nowhere have they
gained such a foothold as in Santo Domingo. They appeared in the
nineties, and for a number of years confined their activities to
peddling goods about the country, both men and women traveling around
with great bundles of merchandise which they spread out wherever they
met prospective purchasers. Their next step was to establish retail
stores and crowd the native Dominican storekeeper out, and of late
years they have opened large business houses. They are not regarded
as a desirable element, as they do not amalgamate or mingle with the
Dominican population, but seem possessed of the single idea to make a
fortune and return with it to their country.
Such part of the retail trade as is not controlled by Syrians, is
mostly in the hands of Dominicans. The stores are generally small,
with a limited stock of goods; they have no show-windows, but are
arranged on the style of bazars. Fixed prices are rare and most sales
become negotiations with the polite shopkeeper. In the country it is
customary for the storekeeper to make advances of merchandise to the
smaller farmers until crop time; they then pay him in cacao, coffee,
tobacco or other farm products, which he remits to the seaport to the
wholesale merchant with whom he deals.
The larger business houses are in a majority of cases owned by
foreigners, principally of Italian, German, Spanish, American and
Cuban citizenship, and now also including numerous Syrian firms. A
majority of those classed as Americans are natives of Porto Rico. A
number of these merchants arrived in Santo Domingo as poor men and by
hard work and shrewd investment built up respectable firms. They
carefully preserved their foreign nationality as a valuable asset
which protected them from undue interference on the part of the
government. One of the most prominent and successful merchants of
Santo Domingo was the late J.B. Vicini, an Italian who came to the
country penniless, but with his energy and sagacity amassed the
largest fortune of the island. His business is now managed by
his sons.
The larger merchants combine a banking business with their export and
import business. The foremost of these private bankers of late years
was Santiago Michelena, a Porto Rican. Less than ten years ago there
was not a single bank in the Republic, but there are now three well
equipped banking institutions, all of them with their local
headquarters in the capital. One of these is the International Banking
Corporation, which is connected with the National City Bank of New
York; it entered the Dominican Republic in April, 1917, by taking over
Michelena's banking business. It has a branch in Macoris and Puerto
Plata and agencies and correspondents throughout the country. Another
bank is the Royal Bank of Canada, which does a flourishing business in
a number of the West India Islands; it has branches in five cities of
the Dominican Republic. The third bank is the Banco Nacional de Santo
Domingo, incorporated by Americans under the Dominican banking law of
1909, with a capital of $500,000. Although it has several branches,
its business is not so active as that of the other banks, since it has
lent most of its capital to the government. Under the banking law this
institution has the right to issue bank notes, but it has not
attempted to use the privilege.
Slowly the establishment of small factories has proceeded, for the
partial provision of local needs. The principal cities have ice
plants, of which some are subject to annoying interruptions. In the
Cibao there are several sawmills. Further there are, in the larger
cities, small establishments for the manufacture of cigars,
cigarettes, matches, rum, straw hats, shoes, chocolate, soap and a few
other articles. These are financed by Dominican capital and are not
able to supply the local demand. In Santo Domingo City are the remains
of a costly brewery erected by Americans with a view to supplying the
West Indies; it was ruined, so local reports say, by bad management
and has been idle for fifteen years. If the amount of soap used by a
people is really an index of its degree of civilization, then the
Dominicans can claim to be far advanced, for the consumption of soap
manufactured in the country and imported, is very considerable. The
government has encouraged manufacturing enterprises and repeatedly
granted concessions exempting their machinery and raw material from
import duties for specified periods. The number of manufacturing
plants will doubtless increase, but agriculture is bound to remain the
mainstay of the country.