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- 🇩🇴 HUGE News for Dominican Republic
In this edition of the Grubernation Weekly Newsletter:
HUGE News for DR (But NO ONE Is Talking About It!)
Buying My House In DR - Early Lessons
12 PAINFUL Mistakes I Made Moving to Dominican Republic
Heard of the DR Inner Circle? A really cool community of people investing in, moving to or interested in Dominican Republic where I work to provide the BEST information, connection and access possible to all of our 300+ members! Jump in!!
🇩🇴 HUGE News for Dominican Republic
Credit rating. Wait! Don’t close the newsletter. It may seem like a boring topic
But this is one of the MOST IMPORTANT developments for the Dominican Republic in YEARS!!
Moody’s just upgraded the country’s credit score — and it’s now one step away from what's called investment grade.
Let me explain…
The 500 Credit Score…
Picture someone with a 500 credit score trying to get a mortgage. Or a car loan. Or just rent an apartment.
Not gonna happen. Or if it does, it’ll come with insane interest rates and giant deposits.
So what do they do?
They cut back. They stop eating out. They pay off high-interest cards. They skip vacations. They spend a year or two living tight, grinding to earn trust again.
And when they hit a 700?
Boom. They’re pre-approved. They’re getting better rates. They’re negotiating from a place of power. They finally have options.
That’s exactly what this credit rating upgrade means for the Dominican Republic.
From Junk to Just-About-Respectable
For a while now, the Dominican Republic has been sitting in what's called junk status — speculative grade, high risk, bad terms.
This Moody’s upgrade moves the country to Ba2 — just two steps before investment grade.
That’s a massive signal to global investors that the Dominican Republic is heading in the right direction. It’s like walking into a lender’s office with your head up instead of hat in hand.
The implications?
Better interest rates on national debt
Cheaper capital for infrastructure, housing, energy, you name it
Bigger investments from institutions that only do business with investment-grade countries
More predictability in the economy
But getting one step closer isn’t the same as being there. There’s still work to do.
The Path Forward: Tax Revenue
Right now, the Dominican government collects 13.7% of GDP in taxes. Most investment-grade nations are pulling in over 25%.
That means the country is short roughly $14 billion USD in annual revenue.
Raising tax rates isn’t going to close that gap. The base is too small, and resistance is too high.
The real move?
Labor formalization.
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The Informal Economy Is Holding the Country Back
Only 45% of workers in the Dominican Republic are considered ‘formal employees’. That means the rest — more than half the labor force — aren’t paying income tax, don’t have social security, can’t access credit, and aren’t protected by labor laws.
This is the drag on the Dominican economy and the key to achieving ‘investment grade’ credit rating.
Formalizing workers does more than just generate tax revenue. It reduces evasion. It unlocks access to capital for small businesses. It creates transparency and trust.
This is the one move that changes the game.
What Peru Did Right
Peru used to be in the same boat.
Back in the early 2000s, the Peruvian economy was dominated by informal labor. Tax collection was low. Credit rating was poor.
Then came all these changes:
Tax simplification
Digital reporting
Enforcement and incentives for formal employment
Clear paths for businesses to legitimize
By 2008, Peru achieved investment grade.
And their formal labor rate went from 30% to over 50%.
Not because the country became perfect. But because progress became undeniable.
DR, by the way, is starting from a much higher floor so an investment grade credit rating becomes ROCKET FUEL!
DR Is In Its Window!
The credit upgrade signals that Moody’s believes the Dominican Republic is serious about progress.
Now it’s about showing follow-through:
Increasing formal labor participation to 60%+
Strengthening digital tax enforcement
Creating incentives for businesses to register
Offering simple, affordable structures for micro and small businesses
There’s no need to gut the informal economy. But pulling more of it into the light could mean billions in new revenue — without blindly raising taxes.
Why This Matters
The Dominican Republic is already a top Caribbean destination. A manufacturing hub in the making. A real estate hot spot. A tourism magnet.
But this credit rating upgrade?
It opens the door to long-term stability and trust.
International banks don’t lend to trends. They lend to systems.
Index funds, mutual funds, insurance companies and pensions can’t legally invest in a country with a ‘junk’ rating - so investment grade opens up a FLOOD of international investment.
Formal labor, strong tax collection, and investor confidence are the foundation for:
Better infrastructure
Lower inflation volatility
More financing for local businesses
Greater resilience to shocks
The country is close. One more major move — especially around labor — and investment grade becomes real.
Quick Plug (But a Good One)
If you’re serious about understanding what’s really happening in the Dominican Republic — beyond beaches and bikinis — join the DR Inner Circle.
It’s $9/month and gets you:
Weekly zoom Q&A with me
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Buying My House in DR - Early Lessons
It’s nearly official!
Our US house is under contract, passed inspection and unless something crazy happens, the buyer should be able to get the mortgage they need to buy it.
Closing is scheduled for August 22.
On the other end is our home purchase in DR.
We’ve been under contract for a while with a few contingencies:
✅ Sale of our US house
✅ Home inspection
⭕️ Financing
While the formal home inspection will be done soon, I had the lead developer for the Four Seasons in Miches go through the property with me and feel pretty confident with what we need to do when we move in.
But so far, there have been some key lessons worth summarizing for you as we go through this process.
And I’ll update as we learn more!
#1: Tax Extensions Are NOT Relevant
When I had my job, filing my taxes was easy and done by April 15.
Now, it is an annual ritual to file an extension for October 15 for a few reasons:
I usually don’t have all K1’s needed by April 15 from investments I’m in
Ensures I don’t miss key details by hurrying ahead of the deadline when my CPA is maximally stressed
Makes sense to pay anticipated taxes and kick the can down the road for our situaiton (most entrepreneurs do the same)
The bank needed our documents for the mortgage in DR which I provided including the formal extension my CPA provided me for 2024.
Bank’s response: ¿que?
DR doesn’t recognize extensions - so I’m scrambling to get my CPA to complete our return so the bank can finalize the loan.
They’ve pre-approved us .. but food for thought if ever sourcing a mortgage in DR
#2: Have a GREAT Attorney
Here I was panicking about the contingent deadline in the contract.
So I talked to my attorney - and he said ‘the seller isn’t ready’
My response: ¿que?
Our seller is going through a divorce and has been trying to get the new title processed so she can sell to us .. but it hasn’t been finalized yet.
A detail and negotiation nugget I was unaware of!
Our US house sale took longer than our August 15 contract deadline to close on the DR house .. but the DR house isn’t ready anyway!
We negotiated an extension. As long as we get funding from the bank on time, we’re good (always a risk though that we lose the house!)
#3: Buy In Established Communities
This one isn’t required but I felt compelled to say it after #2.
Many will hear ‘working on title’ above and reference traumas from title issues they’ve heard of in the past.
They’ll respond warning me about horror story x or y.
I get it .. so I’m doubling down on how to ensure title is secure.
Buy in highly reputable established communities.
Punta Cana Village
Cocotal
Vista Cana
Cap Cana
La Palma
White Sands
All are organized, structured and have land rights in place ensuring your purchase is free and clear of any issues.
That plus a lawyer is your best protection.
Shout out to our realtor Teresa .. she’s been AMAZING and has quarterbacked SO MUCH for us.
If you want a realtor referral - click here
If you want an attorney referral - click here
Know that if you opt to transact with them they’ll compensate me for the referral. Please do your own due diligence and trust your gut!
PRAY FOR US TO GET THIS PURCHSAE ACROSS THE FINISH LINE!!
12 PAINFUL Mistakes I Made Moving to Dominican Republic
This is one of my FAVORITE videos outlining every mistake I could think of when we moved here.
I hope it helps YOU avoid the same mistakes.
Curious which one of the 12 resonates with you most .. lemme know!
Thats it for this week. See you all soon!
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