The director of the General Directorate of Government Accounting (Digecog), Félix Santana García, stated that at debt, which already amounts to almost 70% of gross domestic product (GDP), “nothing can be done if the money diverted from the dominant corruption of the previous government is not recovered and if the pandemic does not reduce its negative effects”.
Santana alluded to the data contained in the report published by the Economic Commission for Latin America and the Caribbean (ECLAC) on the balance of economies in Latin America and the Caribbean 2020 after the impact of coronavirus (COVID-19) in the countries that make up the area.
“Although ECLAC’s economic and financial image of the Dominican Republic is not fully promising for 2021“The situation will improve as the pandemic is reduced by the massive application of vaccines and the money diverted from the corruption of the previous government is recovered,” he said, according to a statement.
The above-mentioned study indicates that in the Dominican Republic the GDP reported a decrease of 5.5%, and at the end of 2020 the central government fiscal deficit is estimated at 9.9% of GDP, when it had been 2.2%. in 2019.
The report indicates that the current account deficit will close at 3% of GDP, while in 2019 it was 1.3%, due to the contraction of revenues due to declining tourism. Year-on-year inflation will close with a 5% limit in the target range, and unemployment has been reduced by 8.8%.
Santana complained that tax collection contracted by 17.1%, with a 19.1% reduction in taxes on goods and services; while social spending showed the most significant increase of 192.6% in real terms from year to year.
He explained that to deal with the crisis, the Government has received loans from various international organizations, such as the World Bank ($ 150 million), the Inter-American Development Bank ($ 486 million), the International Monetary Fund ($ 650 million) and the issuance of sovereign bonds. for a total of US $ 3.8 billion, whose demand reached US $ 9.6 billion, 2.5 times the initial amount issued.
“Although President Luis Abinader has never been in favor of loans“Faced with this economic and financial image that ECLAC has presented to the Dominican Republic, there has been no more viable alternative than to use the confidence that the government offers to obtain international loans,” he said.
Santana believes that “with transparent management, the fight against corruption, good investment and pandemic control, the Dominican nation will have a more promising 2021 in the face of the crisis that was not caused by the current authorities, but was inherited.”