NewsWhore
09-01-2008, 03:30 PM
El Nacional newspaper editorialized on Sunday asking why the government let expire the offer of the International Monetary Fund to monitor the Dominican economy as a follow up to the previous Stand By Arrangement. El Nacional writes that it appears the government is not interested in the IMF reviewing the present or future status of the economy. The editorialist says to ignore the IMF offer sends a bad signal to domestic and foreign economic agents on the status of the economy and erodes the credibility and image of the country before investors and financial institutions.
"There are reasons to think that it is in the country's interest -- and there is still time -- for the government to sign some kind of agreement with the IMF that obliges the government to restrain its spending and reduce the current account deficit and that of the Executive Branch and the Central Bank," writes the editorialist.
The editorial writer says that the available statistics indicate that the current account deficit in the balance of payments could be more than US$4 billion, double that of last year, while the government and Central Bank accounts that are in red are 3.5% of the Gross Domestic Product (GDP), which means the house is still on fire.
The newspaper says that it is convenient for the Dominican economy, now under external pressures and with excessive public spending, to submit to periodical reviews by the IMF, because if not, in the short term, the government will again be forced to subscribe to a new Stand By Arrangement obliging greater restrictions.
The IMF had expected the DR to engage in a post-program monitoring, following the completion of the 3-year Stand-By Arrangement for about US$688.6 milllion in January 2008. The authorities had expressed their willingness to do so on 24 July. At the time, Julio Estrella was appointed as new Dominican government representative to the IMF. The monitoring agreement would oblige the DR to present to the IMF their economic, fiscal and monetary implementation programs twice a year.
Diario Libre reports that government spending is up 40% from January-August 2008, compared to the same period in 2007. Government spending was RD$176.06 billion, or RD$50 billion more than last year and RD$11.6 billion more than fiscal revenues collections.
More... (http://www.dr1.com/index.html#3)
"There are reasons to think that it is in the country's interest -- and there is still time -- for the government to sign some kind of agreement with the IMF that obliges the government to restrain its spending and reduce the current account deficit and that of the Executive Branch and the Central Bank," writes the editorialist.
The editorial writer says that the available statistics indicate that the current account deficit in the balance of payments could be more than US$4 billion, double that of last year, while the government and Central Bank accounts that are in red are 3.5% of the Gross Domestic Product (GDP), which means the house is still on fire.
The newspaper says that it is convenient for the Dominican economy, now under external pressures and with excessive public spending, to submit to periodical reviews by the IMF, because if not, in the short term, the government will again be forced to subscribe to a new Stand By Arrangement obliging greater restrictions.
The IMF had expected the DR to engage in a post-program monitoring, following the completion of the 3-year Stand-By Arrangement for about US$688.6 milllion in January 2008. The authorities had expressed their willingness to do so on 24 July. At the time, Julio Estrella was appointed as new Dominican government representative to the IMF. The monitoring agreement would oblige the DR to present to the IMF their economic, fiscal and monetary implementation programs twice a year.
Diario Libre reports that government spending is up 40% from January-August 2008, compared to the same period in 2007. Government spending was RD$176.06 billion, or RD$50 billion more than last year and RD$11.6 billion more than fiscal revenues collections.
More... (http://www.dr1.com/index.html#3)