The Dominican Republic Recalibrates With Washington on Tariffs, Rice and Telecom

DOMINICAN REPUBLIC · ECONOMY

President Luis Abinader is looking for a new equilibrium with Washington, and he is doing it on three fronts at once. The Dominican Republic is fighting over rice, negotiating down new US tariffs and welcoming a Vietnamese state-owned telecom operator.

Abinader’s overture to Washington

Abinader said on 26 August that his government wants a reciprocal-tariff agreement with the United States. The statement, reported by Listín Diario, follows a difficult summer for Dominican exporters.

Washington imposed new duties of between 10 and 12.5 percent on Dominican products in July. The United States is the country’s main trading partner, so even modest tariffs bite quickly.

A reciprocal deal would aim to lower those duties on both sides. It would also give Abinader a framework for the disputes piling up beneath the headline numbers.

The president is negotiating from a position of relative economic strength. Moody’s raised the country’s credit rating one notch in 2025, leaving it a step from investment grade.

The public finances give him room to maneuver. Debt closed 2025 at 58.5 percent of gross domestic product, down from 69.1 percent in December 2020.

The rice war behind the trade tension

The sharpest bilateral dispute is over a grain. Rice is a staple of the Dominican table, and the government treats it as a food-security product.

In December 2024 Abinader signed a decree setting a 20 percent tariff on rice imports inside the quota. Imports outside the quota face a 99 percent tariff, with a 23,300-tonne duty-free allowance for the United States.

The timing stung American growers. The CAFTA-DR free-trade agreement had just completed a 17-year phase-out, fully opening the rice market on 1 January 2025.

The industry group USA Rice called the decrees a violation of that agreement. US rice exports to the Dominican Republic had grown 102 percent in 2024, reaching US$45.6 million.

The government defends the measure as food security. A 2016 law, toughened in December 2024, labels rice a sensitive product essential to the daily diet.

Dominican rice farmers say the protection keeps rural jobs alive. Imported rice at world prices would undercut tens of thousands of small producers.

Enter Viettel, the fourth operator

The technology leg of the balance is the boldest. Vietnam’s Viettel group plans to invest around US$560 million to enter the Dominican telecom market.

The company received an award of 240 megahertz of radio spectrum for 20 years. It has roughly 90 days to form its local company and sign the concession before building its network.

Its first offer will combine mobile services, fixed broadband and an electronic wallet. Data centres, cloud services and cybersecurity could follow in later phases.

The entry would break the comfortable dominance of Claro and Altice. As we reported on 22 August, Viettel won its spectrum to become the market’s fourth operator.

The group says this will be its first new international market since Myanmar in 2018. That alone signals how seriously it rates the Dominican opportunity.

For consumers, a fourth operator usually means one thing first. Aggressive launch pricing is exactly how the group built its share in Peru.

A military-owned operator in a US-aligned market

Viettel is not a normal phone company. Its full name is Military Industry and Telecoms Group, and it is owned by the Vietnamese state through the Ministry of Defense.

The group began in 1989 as an army communications supplier called Sigelco. Vietnamese law still defines it as a national defense and security enterprise with political and military functions.

Its international record is commercial rather than military. In Peru its Bitel brand took 24.01 percent of active mobile lines in early 2026, becoming the market’s second operator.

The company already works next door in Haiti under the Natcom brand. It claims around 90 million international customers, a figure drawn from its own corporate reporting.

Washington has not publicly objected to the Dominican entry so far. US officials do, however, watch state-linked network vendors across the hemisphere closely.

The wider technology courtship

Abinader is not swapping one patron for another, and he has been careful to show it. His government is courting American technology capital at the same time.

In his February 2026 address to Congress he announced an agreement with NVIDIA. The chipmaker will help build an artificial-intelligence centre of excellence in the country.

The NVIDIA club he described includes the United States, South Korea, Israel and Singapore. His government also signed a separate agreement with Google.

Read together, the pattern is deliberate diversification rather than defection. Santo Domingo wants US capital, Vietnamese networks and its own leverage in between.

The same congressional speech underlined fiscal credibility as part of the pitch. Tax collection reached 15.6 percent of gross domestic product in 2025, with the deficit at 3.45 percent.

What foreigners and investors should watch

For expatriates, the tariff talks matter most through prices. A reciprocal deal would shape the cost of both Dominican exports and American imports on supermarket shelves.

Rating agencies are watching the same balancing act. Fitch and Standard & Poor’s both held their Dominican ratings steady in 2026, citing governance and prudent debt management.

Competition is the quiet winner in all three disputes. Cheaper calls and stable food prices are the domestic dividend Abinader is selling at home.

For investors, telecom is the live opportunity. A fourth operator spending US$560 million will need towers, fibre, contractors and retail distribution across the country.

The rice dispute is the diplomatic tripwire. If Washington links market access to the 99 percent out-of-quota tariff, the reciprocal talks will get harder before they get easier.

The first milestone is Viettel’s 90-day clock for its local company. The second is any sign that the White House will put the Dominican Republic tariffs on a formal negotiating agenda.

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