Two Main Reasons Why Dominican Republic is so Cheap

Many foreigners wonder why the Dominican Republic is such a cheap destination, and this is really a matter of perception because for the natives of the island the country is not cheap at all.

There are two fundamental reasons that make the Dominican Republic a cheap tourist destination or place to live for a foreigner, the first is the exchange rate in relation to the foreign currency, and the second reason is the great competition that exists between hotels in the tourism sectors.

That is, only the tourist sector of Punta Cana has more than 70 all-inclusive resorts located along more than 100 km of coastline, and with approximately 45,000 rooms, the competition that exists in the area is brutal, it is for this reason that hotels must maintain highly competitive prices in order to stay relevant.

In fact, the Dominican Republic must be the country with by far the largest number of hotels in the Caribbean, with Punta Cana being the sector with the most hotels and rooms.

The same happens with the excursions, a lot of companies offer this service in the area, the competition makes the prices relatively cheap.

It is a cheap country because of the exchange rate to local currency

On the other hand, and according to the perception I have had after conversations with many foreigners who have visited the Dominican Republic or who reside in the Dominican Republic.

Many are surprised at how cheap everything can be when they compare prices to their local currency, i.e. compare local costs and translate them to the dollar, things can be ridiculously cheap in the Dominican Republic.

But this is just perception, as I said at the beginning, I am a local in the Dominican Republic, I interact with many foreign people and I also work for people from abroad, and I can perfectly understand this concept of how cheap everything is perceived in the Dominican Republic when you produce money in dollars.

I will give a very basic example, I recently went to eat at a restaurant in the colonial zone, one of the 10 best restaurants in the city of Santo Domingo, I always wanted to go to eat there, the atmosphere is spectacular.

Before going, I researched on the internet what kind of food they serve, people’s comments and how are the prices, from people’s comments almost everyone said that this restaurant was too expensive.

I went to the restaurant with two other people, we ate the best quality meat (one of their most expensive dishes), ribs, had a cocktail, natural juice, beer, ordered a starter, and the bill only made me 70 dollars, all with taxes and tip included

70 dollars for such an exclusive dinner may seem nothing for a foreigner, but this restaurant is considered by the locals as a very expensive place, and in fact, 70 dollars is one-third of a minimum wage of a worker in the Dominican Republic.

That is why I say that one of the main reasons why the Dominican Republic is perceived as a cheap country is because of the local prices and the exchange rate to foreign currency.

That is why on some occasions, and unfairly, some unregulated businesses try to impose other prices on people of foreign origin because it is well known that local prices for foreigners are ridiculously cheap.

Is the Dominican Republic cheap because it is a dangerous country?

I did some research before writing this topic, and the first result I saw on google in relation to this question, specifies that the Dominican Republic, specifically the area of Punta Cana, is cheap because of the high crime rate, and for this reason, the hotels lower their prices.

Which I found to be an incredibly harmful and ignorant answer, by the way, the article is actually very well written, only that opinion seemed to me to be taken out of context.

Yes, the Dominican Republic has crime problems (like ALL Latin American countries), but Punta Cana is a world apart, most tourists and locals know that Punta Cana is a tourist destination totally independent from the local life of the Dominican Republic.

So much so, that I have met some people from abroad who thought Punta Cana was a country.

For tourists who come to vacation at Punta Cana hotels, their stay is incredibly safe, it is basically from the airport to the hotel, and if anything to an excursion in a totally controlled and secure environment.

The “dangerous” life in the Dominican Republic takes place in the big cities, such as the streets of Santo Domingo, which has nothing to do with the hotel life in Punta Cana.

The United States also has some of the most dangerous cities in the world, but that should not be mixed with Disney World (an example), the same with Mexico.

In my opinion, the main reasons why the Dominican Republic is considered a very cheap country is because of the two reasons I mentioned at the beginning of the topic, an incredible competition between a large number of hotels, and perception in relation to the purchasing power of the foreign currency in relation to the Dominican peso.

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  1. thank you so much for this article I have been trying to figure out the reason why Dom Rep has such remarkable deals. Just like you I saw articles about crime but I know this could not be the reason as I’m from Jamaica which has a higher crime rate yet hotels cost more here. I think u have answered the question. Competition among hotels and wages are lower.

    1. Elvis Alcequiez says:

      Hi, thanks for your comment

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