Pristine beaches and cruises: There's a new hotspot for travellers in the Caribbean

The Dominican Republic is gambling it can turn one of its poorest and most remote regions — home to wild goats, a defunct bauxite mine and little else — into one of the Caribbean’s hottest tourist destinations. Built from scratch near the Haitian border, the Pedernales-Cabo Rojo tourism project now under construction will include 12,000 hotel rooms, an international airport, a marina, a seaside promenade, and roads, sewage and electricity infrastructure to handle millions of visitors per year.

If all goes to plan, the estimated $2.2 billion public-private partnership will turn this lonesome stretch of the Dominican southwest, graced with national parks and pristine beaches, into a region to rival Punta Cana, the crown jewel of the country’s tourism industry. It’s also designed to keep the national economy growing at one of the fastest clips in the hemisphere. Hospitality giants Iberostar Group, Hyatt Hotels Corp. and Wyndham Hotels & Resorts Inc. have signed up as operators. Mexico’s ITM Group is managing a newly opened cruise ship port.

For President Luis Abinader, whose family built an empire developing hospitality infrastructure, the project is a bet that tourism can pull an entire region out of poverty.

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“In five years Pedernales will have changed for the better and for ever,” he said, when he inaugurated the cruise port last year. “In 10 years it will be unrecognizable, and in 20 years it will be a model of economic and social development that will be studied by others.”

Kaira Méndez, 27, said that growing up in the province of about 34,000 people, locals could aspire to three things: fishing, farming or being a maid.

While the region has mangroves, crystalline water and lush parks, it can take up to eight hours to get there from the capital of Santo Domingo, and only the most adventuresome make the trek. The new airport, slated to open in 2026, will put most attractions within 20 minutes. It’s already bringing opportunities, said Méndez, a civil engineer who has scored jobs working on the hotels and now the airport.

“I always knew something like this was possible,” she said, as she watched excavators kick up dirt, carving out a mile-and-a-half runway. “Many people still don’t believe that it’s actually happening.”

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Delays and worries

There’s reason for skepticism. The Caribbean is littered with grandiose tourism plans that failed. And some worry this project is so massive, so ambitious, it could collapse under its own weight. The first tranche of hotel rooms — about 1,600 — was slated to be delivered in 2024. It’s still under construction. While roads have been chewed up for miles in preparation for expansion, few have been repaved.

Despite the delays, the project is already reshaping the local economy, said Carlos Peguero, the deputy minister of tourism charged with spearheading the work. Thousands of jobs have been created in a region so small that temporary workers are being bused in from neighboring Haiti. (While the Dominican Republic is deporting Haitians en masse, they remain a major part of the country's construction workforce.)

Sitting in his Santo Domingo office stacked with renderings and architectural plans, Peguero said the project isn’t just another tourism play.

“The president is trying to develop the south of the country using tourism as an engine,” he said. “But this is, first and foremost, a social and economic development project for the people who live in that area.”

The entire region is now under a master plan that was hammered out with local leaders and includes more than 130 public policies and regulations to control gentrification, preserve the environment, promote economic development and ensure the project is sustainable long term, Peguero said.

“We’re building this from zero,” he said. “And so we’re trying to avoid mistakes we’ve made in the past.”

In June, Grupo Puntacana, the country’s premier tourism developer, was brought in to boost private sector participation.

Punta Cana serves as a model and inspiration for Pedernales. In 1983, after years of sometimes bitter negotiations, a group of investors opened up a private international airport on the country’s under-developed east coast. Now that airport is the nation’s busiest, receiving more than 8 million passengers a year who have turned Punta Cana into one of the Caribbean’s premier destinations.

Still, the private sector can’t develop Pedernales on its own, Peguero said, estimating that some $1 billion has already been pumped into the project. Officials, for example, recently opened a new water treatment plant for the region.

“The president has always been clear that the state had to build the sewers and the roads and the electricity and the infrastructure,” Peguero said. “If we waited for the private sector to do that, it would never happen.”

Tourism, spending surge

Grupo Puntacana said it was too early to discuss their involvement and referred questions to the government. Iberostar and Hyatt, two of the most high-profile hotel operators, also declined to talk about the project.

Tourism is a safe bet for the nation, where the industry makes up an estimated 16% of gross domestic product. The country received a record-breaking 8 million visitors in the first eight months of 2025, up 2.8% from last year and 49% from the pre-pandemic levels of 2019, the Ministry of Tourism said in a statement. The Dominican Republic saw 11.2 million travelers last year, more than any country in Latin America but Mexico.

Moody’s Corp. ratings recently upgraded the country to Ba2 from Ba3, citing its tourism receipts, foreign direct investment, remittances, and economic growth of 5% last year.

Yet some are worried about the country’s future. Public spending per capita has soared from $368 in 2000 to $2,249 last year, the Regional Center for Sustainable Economic Strategies, or CREES, a local think tank, said in a recent report. Interest on public debt now represents about 29% of tax revenue.

Infrastructure investments like the ones in Pedernales are better uses of tax dollars than fuel subsidies or expanding the government payroll, said CREES Executive Vice President Miguel Collado Di Franco. “Criticism is very muted,” he said of the project. “But from our point of view, it’s still all part of this public-spending issue.”

Project for whom?

Over a 48-hour period this month, Odanis Grullón’s beachside establishment, El Navio Bar and Seafood, hosted more than 300 cruise ship passengers bused in from the new port. For a business used to catering to a smattering of backpackers, the opportunity has been overwhelming, he said. It’s also filled him with dread.

Just behind his bar, a 150-room hotel is going up. He’s been told by the Ministry of Tourism that — despite the years he invested in getting permits — his establishment is on the wrong side of a boardwalk that’s part of the master plan. He’ll need to move.

“I understand that progress comes with a price,” Grullón said, sitting at his bar and looking out over the ocean. “But many of us locals feel like we’re being excluded from this project, that it’s designed for big foreign interests, that it’s not for us.