Required Report - public distribution

**Date:** 6/1/2006

**GAIN Report Number:** DR6011

DR6011

**Dominican Republic**

**HRI Food Service Sector**

**Annual**

**2006**

**Approved by:**

![](media/image1.wmf)Jamie Rothschild, Agricultural Attaché

U.S. Embassy

**Prepared by:**

Wagner A. Mendez, Ag. Marketing Specialist

**Report Highlights:**

The Dominican Republic is one of the main tourist destinations in the
Caribbean region, with over three million tourist arrivals in 2005. Over
one million of these tourists were from the United States, 8.24% over
2004. The number of hotel rooms in the country in 2005 was 59,870 and
new projects will add about 9,600 rooms this year. Total food
consumption in the HRI sector is estimated over US\$900 million. Around
40 percent of the total food and beverage consumption in the country is
imported, with 30 to 35% of total coming from the United States.

Includes PSD Changes: No

Includes Trade Matrix: No

Annual Report

Santo Domingo \[DR1\]

\[DR\]

**TABLE OF CONTENTS**

# I. MARKET SUMMARY............................................................................... 3

A. The Economic
Situation.......................................................................................
3

B. Overview of the HRI Food Service
market....................................................... 4

C. Recent Development and Trends in the HRI
Sector........................................ 5

# II. ROAD MAP FOR MARKET ENTRY............................................................. 7

A. Entry
Strategy.......................................................................................................
7

B. Market
Structure...................................................................................................
7

C. Sub-sector
Profiles................................................................................................
9

1\. All-Inclusive
Resorts................................................................................
7

2.  Business
    Hotels.......................................................................................
    10

3.  Restaurants..............................................................................................
    11

4.  Fast
    Food...................................................................................................
    11

5.  Institutions................................................................................................
    12

####### III. COMPETITION .................................................................................................... 12

####### BEST PRODUCTS PROSPECTS ......................................................................... 13 

IV. **KEY CONTACTS AND FURTHER INFORMATION**
    .................................... 14

**HOTEL, RESTAURANT, INSTITUTIONAL (HRI)**

###### FOOD SERVICE SECTOR REPORT

# I. MARKET SUMMARY

A.  **The Economic Situation**

![](media/image2.wmf)After recovering from the financial crisis in 2003,
the Dominican economy has a promising outlook. The Fernandez
administration, which took power in August 2004, launched an economic
adjustment and stabilization program aimed at restoring macroeconomic
stability, a program that was renewed in late January 2005 with the
signing of a standby agreement with the International Monetary Fund
(IMF). This program has imposed stringent adjustments, especially in
public finance and the banking sector, the main sources of the
imbalances that undermined stability and encouraged the outflow of
capital in recent years.

![](media/image3.wmf)According to the Economist Intelligence Unit
Country Report 2005, the government's main challenge is to consolidate
the stabilization process. After a doubling of the public debt/GDP ratio
to 57% under the previous administration, the fiscal adjustment has
reduced this ratio by 10 percentage points at end of 2005. Policy will
continue to be guided by the 28-month stand-by arrangement with the IMF
that expires in July 2007.

Currently, the exchange rate of the Dominican peso is quite stable
ranging between DR\$31.00 and DR34.00 to US\$1.00. The International
Monetary Fund forecasts that the Gross Domestic Product (GDP) will grow
by a 4.5 percent in 2006, with inflation returning to single digit
levels (7.44%).

![](media/image4.wmf)

####### Overview of the HRI Food Service Market

![](media/image5.wmf){width="4.083333333333333in"
height="2.8368055555555554in"}

######## 

######## 

+----------------------------------+-----------------------------------+
| ########                         |                                   |
|                                  |                                   |
| ######## ADVANTAGES AND          |                                   |
|  CHALLENGES FACING U.S. PRODUCTS |                                   |
|                                  |                                   |
| ######## IN THE HRI              |                                   |
| SECTOR IN THE DOMINICAN REPUBLIC |                                   |
+----------------------------------+-----------------------------------+
| **Advantages**                   | **Challenges**                    |
+----------------------------------+-----------------------------------+
| -   American culture has a great | -   The local Dominican food      |
|     influence on the Dominican   |     industry is becoming more     |
|     Republic, driven by the      |     efficient and more            |
|     large number of Dominicans   |     competitive, as is            |
|     living in the United States  |     integrating new technologies  |
|     and domination of U.S. mass  |     into production to take       |
|     media, such as cable TV.     |     advantage of the DR-CAFTA.    |
|                                  |                                   |
| -   The growth of tourism in the | -   Globalization and the         |
|     country is increasing demand |     influence of the mass media   |
|     for imported products in     |     have given Dominicans access  |
|     that sector.                 |     to other cultures, e.g.,      |
|                                  |     Europe, Asia, and South       |
| -   When the DR-CAFTA commences, |     America. These different      |
|     it will improve access for   |     cultures influence            |
|     meat and dairy products and  |     consumption habits here and   |
|     should help to improve       |     increase demand for food from |
|     Customs clearance.           |     those countries.              |
|                                  |                                   |
| -   Fast food chains and other   | -   The prices of products        |
|     types of restaurants from    |     offered in fast food          |
|     the U.S. are very popular in |     restaurants of U.S. origin    |
|     the country.                 |     are relatively high.          |
|                                  |                                   |
| -   The perception of consumers  | -   In the Dominican Republic,    |
|     is that U.S. suppliers can   |     there are currently           |
|     provide products with        |     significant tariff and        |
|     consistent and reliable      |     non-tariff barriers to        |
|     quality and quantity, which  |     imports of meat and dairy     |
|     helps reduce overall food    |     products.                     |
|     service costs.               |                                   |
|                                  | -   The Dominican Republic signed |
|                                  |     a free trade agreement with   |
|                                  |     the other Central American    |
|                                  |     countries, which may increase |
|                                  |     trade within this area,       |
|                                  |     possibly at the expense of    |
|                                  |     United States.                |
+----------------------------------+-----------------------------------+

B.  **Recent Development and Trends in the HRI Sector**

The Dominican Republic is developing an image as one of the premier
tourist locations. The Center for Export and Investment (CEI-RD), the
National Competitiveness Council (CNC), and the Ministry of Tourism
(SETUR) are leading this project. The plan is to improve the image and
infrastructure to provide better service to attract tourists with higher
purchasing power. The country is also increasing the budget to increase
the promotion of the Dominican tourist sector in international trade
shows and it is also giving special incentives to investors building
hotels to attract high class tourists.

The new projects focusing on building boutique hotels to attract new
tourists and the strategic plan developed by the Dominican Republic for
the tourist sector are expected to increase the flow of tourists, the
average stay, and the amount of money spent. The government is also
giving preferential treatment on taxes to all-inclusive resorts. Twenty
percent of the rate is being exempted of the value added tax (ITBIS),
which is currently 16%. These factors will strengthen the tourist sector
and will increase the demand for imported food and beverages.

U.S. suppliers need to keep up with the trends in the sector and take
advantage of the new developments to increase their market share. The
FAS office in Santo Domingo will continue to monitor the trends in the
sector and the demand for specific imported products to continue to
provide sound advise to U.S. suppliers.

+---------------------------------------------------+------------------+
| **HOTEL PROJECTS INITIATED IN 2006**              |                  |
+---------------------------------------------------+------------------+
| **NAME OF THE PROJECT**                           | **No. OF ROOMS** |
+---------------------------------------------------+------------------+
|                                                   |                  |
+---------------------------------------------------+------------------+
| **SANTO DOMINGO**                                 |                  |
+---------------------------------------------------+------------------+
| El Prado Gran Hotel                               | 200              |
+---------------------------------------------------+------------------+
| **TOTAL SANTO DOMINGO**                           | **200**          |
+---------------------------------------------------+------------------+
| ** **                                             |                  |
+---------------------------------------------------+------------------+
| **BAYAHIBE**                                      |                  |
+---------------------------------------------------+------------------+
| La Flor de Bayahibe                               | 200              |
+---------------------------------------------------+------------------+
| **TOTAL BAYAHIBE**                                | **200**          |
+---------------------------------------------------+------------------+
|                                                   |                  |
+---------------------------------------------------+------------------+
| **SAMANA**                                        |                  |
+---------------------------------------------------+------------------+
| Gran Bahía Príncipe Cayacoa                       | 295              |
+---------------------------------------------------+------------------+
| Gran Bahía Príncipe Samaná                        | 103              |
+---------------------------------------------------+------------------+
| Gran Bahía Príncipe El Portillo                   | 396              |
+---------------------------------------------------+------------------+
| Gran Bahía Principe Cayo Levantado                | 195              |
+---------------------------------------------------+------------------+
| # TOTAL SAMANA                                    | **989**          |
+---------------------------------------------------+------------------+
|                                                   |                  |
+---------------------------------------------------+------------------+
| **BAVARO PUNTA CANA**                             |                  |
+---------------------------------------------------+------------------+
| Cap Cana                                          | 3800             |
+---------------------------------------------------+------------------+
| Melia - Gran Melia Punta Cana                     | 350              |
+---------------------------------------------------+------------------+
| Melia - (2da. Etapa Golf Suites)                  | 80               |
+---------------------------------------------------+------------------+
| Hotel Ocre Rojo (Uvero Alto )                     | 500              |
+---------------------------------------------------+------------------+
| Sandal Hotel (Punta Cana)                         | 360              |
+---------------------------------------------------+------------------+
| Hotel Jovero (Miche)                              | 300              |
+---------------------------------------------------+------------------+
| Villas Punta Blanca ( Bavaro)                     | 216              |
+---------------------------------------------------+------------------+
| Hodelpa Ocean Sand                                | 350              |
+---------------------------------------------------+------------------+
| Catalonia                                         | 300              |
+---------------------------------------------------+------------------+
| Ahmsa Marina                                      | 800              |
+---------------------------------------------------+------------------+
| Hoteles Fiesta                                    | 140              |
+---------------------------------------------------+------------------+
| Complejo Turístico y Residencia Rõco Ki           | 296              |
+---------------------------------------------------+------------------+
| **TOTAL BAVARO PUNTA CANA**                       | **7,492**        |
+---------------------------------------------------+------------------+
| ** **                                             |                  |
+---------------------------------------------------+------------------+
| **SANTIAGO**                                      |                  |
+---------------------------------------------------+------------------+
| **Courtyard by Marriott**                         | 60               |
+---------------------------------------------------+------------------+
| **Gran Hotel Cibao**                              | 400              |
+---------------------------------------------------+------------------+
| **TOTAL SANTIAGO**                                | **460**          |
+---------------------------------------------------+------------------+
| **BANI**                                          |                  |
+---------------------------------------------------+------------------+
| Complejo Turistico y Spa ROXANA DEL MAR           | 68               |
+---------------------------------------------------+------------------+
| ** TOTAL BANI**                                   | ** 68**          |
+---------------------------------------------------+------------------+
| # GRAND TOTAL                                     | **9,409**        |
+---------------------------------------------------+------------------+
| Source: National Hotels and Restaurant            |                  |
| Association (ASONAHORES)                          |                  |
+---------------------------------------------------+------------------+

####### II. ROAD MAP FOR MARKET ENTRY

####### A. ENTRY STRATEGY

**All-Inclusive Resorts:** The majority of all-inclusive resort
facilities import through in-house central buying entities. In some
cases, central buying entities are located in other countries, such as
the United States, Mexico, and Spain. Some products are purchased from
local importer/distributors especially when items need to be sourced
immediately. Purchasing managers have had some flexibility to source
products to control costs. They purchase from domestic producers and
local importer/distributors as product quality, price and necessity
dictate. Products like meat, cheese, seafood, and wine are sourced
through local importers who usually buy these products in the United
States, Europe, or other countries. Other products such as vegetables,
milk, coffee, vegetable oil, and cocktail mixes are usually sourced from
local producers.

Other hotel chains, which are not currently importing, are planning to
import products when the DR-CAFTA commences. When the agreement is
implemented, it may be more cost efficient for them to import.

**Business Hotels/Restaurants:** Dominican business hotels and upscale
restaurants source almost all of their food products from
importer/distributors. To introduce new products, it is useful to
approach the food and beverage managers at hotels and restaurant owners
directly. If there is interest on the product, it will be turned over to
an established supplier to source. We consider that the most efficient
manner to enter this segment of the HRI market is through an established
importer/distributor. It is also advisable that U.S. companies hire a
local representative to promote the products to the major
importer/distributors and the purchasing departments of major hotel
chains.

**Fast Food:** Usually, fast food chains from the United States import
their own products and ingredients through established franchise
channels. Dominican fast food restaurant serve traditional foods, which
are almost exclusively sourced domestically.

**B. MARKET STRUCTURE**

There have been major changes in the food operations in resorts over the
past five years. Around 80 percent of hotels in the country are now
all-inclusive. Offering a relatively low all-inclusive price means that
hotels must control food costs, while meeting their guests' expectations
for quality and variety. Tour operators have sharply increased demands
on hotels to improve the quality and safety of the foods they offer to
the point of wielding influence over the type of supplier used. At times
they require that specific firms be contracted to ensure that quality
control practices are met. Local competition has also increased
substantially, due to increases in domestic product quality. There is
also a trend towards using semi-processed products to reduce costs.

Usually, intermediaries who handle products for this sector are
specialized. As a result, there are suppliers that only handle specific
products, such as meats, seafood, frozen vegetables, ice creams, fruit
juices and alcoholic beverages. However, there are also some suppliers
who deal with a variety of these categories. Most of these
intermediaries function as wholesale importers, who handle other types
of products to sell to supermarkets and to the country\'s traditional
mom n' pop stores. Also, some intermediaries belong to local processing
businesses that round out their product line with other imported
products. Furthermore, some local processors are trying to strengthen
their distribution system, including imported products.

Local products are mostly handled through the same distribution channels
as imported ones. Some local producers have approached distributors or
intermediaries that are specialized in this market to try to introduce
their products. However, some of the country\'s largest businesses
prefer to sell directly to this sector, avoiding having to depend on
intermediaries to introduce new products.

The main tourist beach resort areas in the country are indicated on the
map below. Although the Dominican Republic is a small country, each
tourist region is different. Bavaro-Punta Cana is currently the place
where a large amount of resources are being invested. The hotels and
tourist complex that are located in the area try to cater a high-class
tourist that is able to stay more days in the area and spend more money
than average. Even within the northern region of Puerto Plata there are
differences from one place to another. Playa Dorada, which used to be
the number one tourist destination in the region, is now introducing the
boutique-hotel concept and is developing differently than Susua and
Cabarete, which are only a few miles away. Cabarete is being promoted as
a paradise for tourists who like extreme sports; therefore hotels
promote themselves differently and pursue a different tourist than the
one that is being targeted by the hotels in Punta Cana. Because of these
differences in each region the food and beverages served, the sizes of
the hotels, the rates and services offered will vary.

![](media/image6.wmf){width="5.833333333333333in"
height="3.7465277777777777in"}

####### C. SUB-SECTOR PROFILES

**1. All-Inclusive Resorts**

The resort/hotel sector is the largest market segment in this area. The
Dominican Republic is receiving increasing worldwide recognition as a
premier vacation destination, which has made it an attractive venue for
fairs, conferences, conventions and international events. These factors
contribute to an increasing flow of business people to the country.

+-----------+--------------------+---------+------+------------------+
| **MAJOR   |                    |         |      |                  |
| COMPANY   |                    |         |      |                  |
| P         |                    |         |      |                  |
| ROFILES** |                    |         |      |                  |
+-----------+--------------------+---------+------+------------------+
| **Name of | **Locations**      | *       | **T  | **Purchasing     |
| Resort**  |                    | *Number | otal | Agent**          |
|           |                    | of      | Roo  |                  |
|           |                    | H       | ms** |                  |
|           |                    | otels** |      |                  |
+-----------+--------------------+---------+------+------------------+
| Barceló   | Santo Domingo/     | 16      | 4    | Importer /       |
| Hotels    | Juan Dolio/ Punta  |         | ,323 | Direct           |
|           | Cana/Bávaro,       |         |      |                  |
|           | Barahona,          |         |      |                  |
+-----------+--------------------+---------+------+------------------+
| RIU       | Punta Cana/Arena   | 8       | 3    | Importer /       |
|           | Gorda/             |         | ,490 | Direct           |
|           | Bávaro/Puerto      |         |      |                  |
|           | Plata              |         |      |                  |
+-----------+--------------------+---------+------+------------------+
| O         | Santo Domingo/ Las | 9       | 3    | Importer /       |
| ccidental | Pascualas/Sosua /  |         | ,486 | Direct           |
| Hotel     | Las Terrenas/Punta |         |      |                  |
| s/Allegro | Cana/              |         |      |                  |
|           |                    |         |      |                  |
|           | Bavaro/Puerto      |         |      |                  |
|           | Plata/Samana       |         |      |                  |
+-----------+--------------------+---------+------+------------------+
| Iberostar | Arena Gorda/       | 5       | 2    | Importer /       |
|           | Puerto Plata/      |         | ,401 | Direct           |
|           |                    |         |      |                  |
|           | Bayahibe/Punta     |         |      |                  |
|           | Cana / Bávaro      |         |      |                  |
+-----------+--------------------+---------+------+------------------+
| Fiesta    | Santo              | 2       | 880  | Importer /       |
| Hotels    | Domingo/Bávaro     |         |      | Direct           |
+-----------+--------------------+---------+------+------------------+
| AMHSA     | Playa              | 8       | 2    | Importer /       |
| HOTELS    | Dorada/Sosua/      |         | ,431 | Direct           |
|           | Cabarete/Samana/   |         |      |                  |
|           | LasTerrenas/       |         |      |                  |
|           | Bávaro /           |         |      |                  |
|           |                    |         |      |                  |
|           | Punta Cana/Juan    |         |      |                  |
|           | Dolio              |         |      |                  |
+-----------+--------------------+---------+------+------------------+
| LTI       | Punta Cana/Sosua/  | 3       | 1    | Importer         |
|           | Bávaro             |         | ,680 |                  |
+-----------+--------------------+---------+------+------------------+
| Coral by  | Bayahibe/Juan      | 4       | 2    | Importer         |
| Hilton    | Dolio/             |         | ,002 |                  |
|           |                    |         |      |                  |
|           | Boca Chica/Puerto  |         |      |                  |
|           | Plata              |         |      |                  |
+-----------+--------------------+---------+------+------------------+
| Hotetur   | Boca Chica/Puerto  | 3       | 847  | Importer         |
|           | Plata              |         |      |                  |
+-----------+--------------------+---------+------+------------------+
| Princess  | Punta Cana/ Bávaro | 3       | 1    | Importer         |
| Hotels    |                    |         | ,415 |                  |
+-----------+--------------------+---------+------+------------------+
| Sol Melia | Punta Cana/Bavaro/ | 3       | 1    | Importer         |
|           |                    |         | ,789 |                  |
|           | Santo Domingo      |         |      |                  |
+-----------+--------------------+---------+------+------------------+
| Super     | Sosua/Punta        | 2       | 1    | Importer         |
| Clubs     | Cana/Bavaro        |         | ,169 |                  |
+-----------+--------------------+---------+------+------------------+
| Premier   | La Romana          | 1       | 300  | Importer         |
| Hotels    |                    |         |      |                  |
|           |                    |         |      |                  |
| Casa de   |                    |         |      |                  |
| Campo     |                    |         |      |                  |
+-----------+--------------------+---------+------+------------------+

2.  **Business Hotels**

Most of the hotels listed below are in the capital city, Santo Domingo.
They are basically business hotels but are used by tourists interested
in the Colonial City and other tourist attractions in Santo Domingo.
Most are affiliated with international hotel chains.

The Hilton Santo Domingo, located at a prestigious location on the
waterfront, was inaugurated in 2005. Malecon Center, where the hotel is
located, is a landmark 194,000 square meter residential, commercial, and
high-rise hotel complex has three 30-story towers and an ocean view
terrace. The Malecón Center features five movie theatres, 175 store
locations, office space, and restaurants. The Hilton operates a
22-floor, 228 room hotel in the complex, with gymnasium, casino, and
meeting rooms with a capacity for 1,300 persons.

+-------------------+-------------------+------+--------+-----------+
| ##                |                   |      |        |           |
|                   |                   |      |        |           |
| ## DOMINICA       |                   |      |        |           |
| N BUSINESS HOTELS |                   |      |        |           |
+-------------------+-------------------+------+--------+-----------+
| **Name of Hotel** | **Locations**     | **Nu | *      | **P       |
|                   |                   | mber | *Total | urchasing |
|                   |                   | of   | R      | Agent**   |
|                   |                   | Hote | ooms** |           |
|                   |                   | ls** |        |           |
+-------------------+-------------------+------+--------+-----------+
| Hilton            | Santo Domingo     | 1    | 228    | From      |
|                   |                   |      |        | import    |
|                   |                   |      |        | ers/local |
|                   |                   |      |        | suppliers |
+-------------------+-------------------+------+--------+-----------+
| Renaissance       | Santo Domingo     | 1    | 293    | Importer  |
| Jaragua           |                   |      |        | / Direct  |
+-------------------+-------------------+------+--------+-----------+
| V Centenario      | Santo Domingo     | 1    |        | Importer  |
| Intercontinental  |                   |      |        | / Direct  |
+-------------------+-------------------+------+--------+-----------+
| Melia Santo       | Santo Domingo     | 1    | 245    | Importer  |
| Domingo           |                   |      |        | / Direct  |
+-------------------+-------------------+------+--------+-----------+
| Hotel Embajador   | Santo Domingo     | 1    | 286    | Importer  |
|                   |                   |      |        | / Direct  |
+-------------------+-------------------+------+--------+-----------+
| Hotel Santo       | Santo Domingo     | 2    | 2      | Importer  |
| Domingo           |                   |      | 15/165 | / Direct  |
|                   |                   |      |        |           |
| /Hispaniola       |                   |      |        |           |
+-------------------+-------------------+------+--------+-----------+
| Dominican Fiesta  | Santo Domingo     | 1    | 331    | Importer  |
|                   |                   |      |        | / Direct  |
+-------------------+-------------------+------+--------+-----------+
| Hotel Naco        | Santo Domingo     | 1    | 106    | Importer  |
|                   |                   |      |        | / Direct  |
+-------------------+-------------------+------+--------+-----------+
| Hotel Clarion     | Santo Domingo     | 1    | 213    | Importer  |
| (Plaza Naco)      |                   |      |        |           |
+-------------------+-------------------+------+--------+-----------+
| Barcelo Gran      | Santo Domingo     | 1    | 217    | Importer  |
| Hotel Lina        |                   |      |        |           |
+-------------------+-------------------+------+--------+-----------+
| Hotel Courtyard   | Santo Domingo     | 1    | 146    | Importer  |
| (Marriott)        |                   |      |        |           |
+-------------------+-------------------+------+--------+-----------+
| Hotel El Gran     | Santiago          | 1    | 156    | Importer/ |
| Almirante         |                   |      |        | Di        |
|                   |                   |      |        | stributor |
+-------------------+-------------------+------+--------+-----------+

3.  **Restaurants**

Santo Domingo has an extensive up-scale restaurant sector, which caters
to the wealthier classes, businesses and tourists. The economic crisis
that began in 2003 has hurt business for many of these establishments,
but not to the point of forcing extensive closures. The list below is
only the main upscale restaurants in Santo Domingo. There are many
others. All of them have international menus and individual specialties.
Ethnic restaurants include German, Arabic, Argentine, Spanish, French,
Italian, Mediterranean, Mexican, and Chinese.

Restaurants offer good opportunities for exporters from the United
States. Since these restaurants do not function as chains and purchases
are small, they source almost all products through
importer/distributors. A few import some products directly. To meet the
needs for international dishes, they import beef, fish and seafood,
pasta, and pork products.

The general trend towards eating out has led to the opening of many
small restaurants focusing on the lunch crowd, independent cafeterias,
cafeterias located inside businesses, and cafeterias in supermarkets.
These establishments provide local food, sandwiches, and snacks at
affordable prices to working-class Dominicans.

+--------------+---------------+-------------+------------------------+
| ##           |               |             |                        |
|              |               |             |                        |
| ## DOMIN     |               |             |                        |
| ICAN UPSCALE |               |             |                        |
|  RESTAURANTS |               |             |                        |
+--------------+---------------+-------------+------------------------+
| **Name of    | ###           | **Type of   | **Purchasing Agent**   |
| Restaurant** | ### Locations | Cuisine**   |                        |
+--------------+---------------+-------------+------------------------+
| La Bricciola | Santo Domingo | In          | Importer/Direct        |
|              |               | ternational |                        |
+--------------+---------------+-------------+------------------------+
| Davy         | Santo Domingo | Steak House | Importer/Direct        |
| Crockett     |               |             |                        |
+--------------+---------------+-------------+------------------------+
| Fellini      | Santo Domingo | Italian     | Importer/Direct        |
+--------------+---------------+-------------+------------------------+
| Outback      | Santo Domingo | Australian  | Importer/Direct        |
| Steakhouse   |               |             |                        |
+--------------+---------------+-------------+------------------------+
| Scherezade   | Santo Domingo | Me          | Importer/Direct        |
|              |               | diterranean |                        |
+--------------+---------------+-------------+------------------------+
| Taboo Bamboo | Santo Domingo | Asian       | Importer               |
+--------------+---------------+-------------+------------------------+
| Bella        | Santo Domingo | Cantonese   | Importer/Direct        |
| Cristal      |               |             |                        |
+--------------+---------------+-------------+------------------------+
| Juan Carlos  | Santo Domingo | Spa         | Importer/Direct        |
|              |               | nish/French |                        |
+--------------+---------------+-------------+------------------------+
| Toscana      | Santo Domingo | Italian     | Importer/Direct        |
+--------------+---------------+-------------+------------------------+
| Tony Roma's  | Santo Domingo | Steak House | Importer/Direct        |
+--------------+---------------+-------------+------------------------+
| Samurai      | Santo Domingo | Japanese    | Importer               |
+--------------+---------------+-------------+------------------------+
| Pepperoni    | Santo Domingo | Pastas      | Importer               |
+--------------+---------------+-------------+------------------------+
| Seasons      | Santo Domingo | Creative    | Importer/Direct        |
|              |               | Foods       |                        |
+--------------+---------------+-------------+------------------------+
| Vesuvio I &  | Santo Domingo | Italian     | Importer/Direct        |
| II           |               |             |                        |
+--------------+---------------+-------------+------------------------+
| Porterhouse  | Santo Domingo | In          | Importer               |
|              |               | ternational |                        |
+--------------+---------------+-------------+------------------------+

4.  **Fast Food**

Fast food restaurants are the fastest growing sector in the food service
industry. Foreign fast food chains, mostly from the United States,
started in the Dominican Republic in 1994 and have been very well
received by Dominicans. Over 48 of these establishments have been
opened, mostly in Santo Domingo and Santiago. The entry of foreign fast
food chains has spurred the development of local businesses, although
they tend to specialize in local popular foods. Many of them import
their own products, primarily in the case of hamburger, meat, poultry,
potatoes, sauces and ice cream. Fresh vegetables and bread are procured
domestically.

+------------+---------------------+------------+---------------------+
| **FAST     |                     |            |                     |
| FOOD       |                     |            |                     |
| RESTAURANT |                     |            |                     |
| PROFILES** |                     |            |                     |
+------------+---------------------+------------+---------------------+
| **Name of  | ## Locations        | **Number   | **Purchasing        |
| Re         |                     | of         | Agent**             |
| staurant** |                     | Outlets**  |                     |
+------------+---------------------+------------+---------------------+
| Burger     | Santo Domingo,      | 27         | Direct              |
| King       | Santiago, San       |            |                     |
|            | Francisco, La Vega, |            |                     |
|            | Puerto Plata, Boca  |            |                     |
|            | Chica, La Romana,   |            |                     |
|            | Punta Cana          |            |                     |
+------------+---------------------+------------+---------------------+
| Kentucky   | Santo Domingo       | 4          | Direct              |
| Fried      |                     |            |                     |
| Chicken    |                     |            |                     |
+------------+---------------------+------------+---------------------+
| Domino\'s  | Santo Domingo,      | 6          | Direct              |
| Pizza      | Santiago            |            |                     |
+------------+---------------------+------------+---------------------+
| Pizza Hut  | Santo Domingo,      | 6          | Direct              |
|            | Santiago            |            |                     |
+------------+---------------------+------------+---------------------+
| Taco Bell  | Santo Domingo,      | 8          | Direct              |
|            | Santiago            |            |                     |
+------------+---------------------+------------+---------------------+
| McDonalds  | Santo Domingo,      | 3          | Direct              |
|            | Santiago            |            |                     |
+------------+---------------------+------------+---------------------+

5.  **Institutions**

Many large businesses have set up cafeterias in order to offer food to
their employees. These are independently run. Some free trade zones and
industrial parks have also begun to install cafeterias, with the
objective of offering inexpensive food of an acceptable quality. These
cafeterias are more oriented to serving traditional dishes, with over 90
percent of ingredients being produced domestically. In this category
there is limited opportunity for U.S. exporters, except for basic items
and condiments offered at cut-rate prices. The handling of food in
prisons and public hospitals has not been privatized and most inputs are
sourced domestically.

**III. COMPETITION**

The level and types of competition faced will depend on the sector of
the food service industry. There have been problems in obtaining import
permits, which have been used to limit imports of meat and dairy
products. Generally imports of other processed food products come in
without problem. The DR-CAFTA free trade agreement, which is expected to
start in July 1 of this year 2006, will provide better access for many
products and lower duties. This will make U.S. products even more
competitive.

**Resorts:** A number of resort chains have European ownership, cater to
European tourist groups, and therefore, have a strong bias toward
European products. However, the all-inclusive style requires that
attractive food be served with a close eye on price. This does provide
openings for many U.S. food and beverage products, because of
competitive U.S. prices and lower transportation costs. Produce and
fruit are generally sourced domestically, as well as ingredients for
bread and pastry products.

**Business Hotels/Restaurants:** Although there is a European bias in
many up-scale restaurants, the United States has a strong presence. Wine
has been especially difficult for U.S. suppliers, mainly because of the
bias toward European wines for the perception of quality and from
Chilean wines because of their price competitiveness. However, in the
free trade agreement, the duties on U.S. wines were lowered from 20
percent to zero, which should increase interest in this sector.

**IV. BEST PRODUCTS PROSPECTS**

Dominican importers and consumers have shown high interests in the
following products:

+----------------------------------------------+-----------------------+
| **U.S. EXPORTS TO THE DOMINICAN REPUBLIC**   |                       |
|                                              |                       |
| **(THOUSAND OF DOLLARS)**                    |                       |
+----------------------------------------------+-----------------------+
| **PRODUCT**                                  | **2005**              |
+----------------------------------------------+-----------------------+
| 1\. Dairy Products                           | 18,540                |
+----------------------------------------------+-----------------------+
| 2\. Red Meats, Fresh/Chilled/Frozen          | 11,047                |
+----------------------------------------------+-----------------------+
| 3\. Fresh Fruit                              | 9,084                 |
+----------------------------------------------+-----------------------+
| 4\. Snack Foods                              | 8,814                 |
+----------------------------------------------+-----------------------+
| 5\. Wine and Beer                            | 4,601                 |
+----------------------------------------------+-----------------------+
| 6\. Breakfast Cereals and pancake mix        | 3,533                 |
+----------------------------------------------+-----------------------+
| 7\. Red Meats, Prepared/ Preserved           | 2,129                 |
+----------------------------------------------+-----------------------+
| 8\. Low Carb and Light Foods                 | N/A                   |
+----------------------------------------------+-----------------------+

Source: FAS BICO Report

**Products Not Present in Significant Quantities with Good Sales
Potential**

Usually, the Dominican Republic follows trends in the United States.
Diet/healthy products, although not present in large quantities, are
increasing in demand.

# Products Not Present Because They Face Significant Barriers

Importers of meat and dairy products face some problems in obtaining
sanitary and phytosanitary (no objection) import permits. Although these
products are not subject to quotas, the import permit process is tightly
controlled, making it difficult at times to bring in reliable supplies.
In addition, imports for seven major agricultural categories (rice,
sugar, garlic, poultry meat, beans, onions and powered milk) are managed
through import quotas.

V.  **KEY CONTACTS AND FURTHER INFORMATION**

If you have any questions or comments regarding this report or need
assistance exporting to the Dominican Republic, please contact us at:

**OFFICE OF AGRICULTURAL AFFAIRS**

**U.S. EMBASSY-SANTO DOMINGO**

Ave. Pedro Henriquez Ureña, #133

La Esperilla. Santo Domingo, Dominican Republic

Tel: (809) 227-0112

Fax: (809) 732-9454

Email: <AgSantoDomingo@usda.gov>

Home page: www.usemb.gov.do/fas.htm

For more information on the on the HRI sector in the Dominican Republic,
you can also contact ASONAHORES, which is the leading organization in
the sector.

NATIONAL ASSOCIATION OF HOTELS AND RESTAURANTS, INC. (ASONAHORES)

Enrique de Marchena, President

Arturo Villanueva, Executive Vice President

Calle Presidente González, Esquina Avenida Tiradentes

Edificio Cumbre, 8 Piso, Plaza Naco

Santo Domingo, D. R.

Tel: (809) 540‑4676, Fax: (809) 687-4727

Email: