Trade Liberalization and Market Access: Analyzing Dominican Export Performance during the Twentieth Century

This paper examines the effect of state-led industrialisation, trade liberalisation, economic reform and world demand on the growth and composition of Dominican exports during the twentieth century. This involved construction of long-run time series for the real value, volume and market prices of total exports from 1905-2000, and of FTZ exports from 1976-2000, including disaggregated FTZ exports by commodity group when possible. Despite the common assertion that trade liberalisation has spearheaded export growth and diversification in developing countries, the process in the Dominican Republic has been driven largely by US trade policy, suggesting that trade liberalisation in the developing country cannot guarantee export growth unless it is accompanied by improved market access in the destination market(s). Furthermore, evidence of export diversification in the Dominican Republic is more apparent than real, with sugar continuing to dominate primary exports and FTZs dominating manufactured exports, and low-technology, labour-intensive textile and garment production in particular. At the same time that the composition of FTZ export composition has narrowed, so too have export markets toward the US – despite a sustained fall in the country’s share of the US market