NewsWhore
05-11-2006, 03:10 PM
The International Monetary Fund reports that it has completed the third and fourth reviews under the 28-month stand-by arrangement (about US$648.2 million) for the Dominican Republic. In a release dated 10 May, the IMF indicates completion of the reviews enables the country to receive up to US$142.6 million. The IMF Board announced that it granted, at the DR's request, seven waivers related to incomplete fulfillment of structural criteria.
Agustin Carstens, deputy managing director and acting chairman of the IMF's board discussion commented on the "remarkable improvement in economic conditions" - strong growth, single-digit inflation, lower public debt ratio and rise in international reserves.
Nevertheless, the IMF wants the government to secure more revenue. "To ensure the continued adjustment effort in 2007, the authorities will need to give early consideration to additional revenue measures that would address the shortfall stemming from the recent tax reform and the expected implementation of the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA) with the United States."
In January, the government began implementing increased taxation using this same argument, despite the agreement being postponed for July implementation.
The IMF is concerned about the electricity situation. "Action is needed to contain the deficits in the electricity sector, including by raising the cash recovery indices of electricity distributors. Allowing electricity prices to adjust in response to changes in costs, while improving services, will contribute to reducing government transfers, establish a sound commercial basis for the operation of the sector, and spur greatly needed capital investments," states the release.
The IMF also addressed the RD$155 billion quasi-fiscal deficit. "A comprehensive strategy to recapitalize the Central Bank is being developed, aimed at a gradual reduction in the Bank's quasi-fiscal deficit," it states.
The IMF is also supporting what it describes as "timely implementation of structural reforms covering a wide range of governance and transparency issues in the fiscal and banking sectors will be critical in the period ahead." The IMF release states: "Criminal proceedings against former owners of those banks involved in the 2003 banking crisis should send a strong signal regarding the consequences of misconduct, and it will be important to ensure the proceedings are sufficiently comprehensive to include all concerned officials."
See http://www.imf.org/external/np/sec/pr/2006/pr0695.htm
Link To Original Article (http://www.dr1.com/index.html#7)
Agustin Carstens, deputy managing director and acting chairman of the IMF's board discussion commented on the "remarkable improvement in economic conditions" - strong growth, single-digit inflation, lower public debt ratio and rise in international reserves.
Nevertheless, the IMF wants the government to secure more revenue. "To ensure the continued adjustment effort in 2007, the authorities will need to give early consideration to additional revenue measures that would address the shortfall stemming from the recent tax reform and the expected implementation of the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA) with the United States."
In January, the government began implementing increased taxation using this same argument, despite the agreement being postponed for July implementation.
The IMF is concerned about the electricity situation. "Action is needed to contain the deficits in the electricity sector, including by raising the cash recovery indices of electricity distributors. Allowing electricity prices to adjust in response to changes in costs, while improving services, will contribute to reducing government transfers, establish a sound commercial basis for the operation of the sector, and spur greatly needed capital investments," states the release.
The IMF also addressed the RD$155 billion quasi-fiscal deficit. "A comprehensive strategy to recapitalize the Central Bank is being developed, aimed at a gradual reduction in the Bank's quasi-fiscal deficit," it states.
The IMF is also supporting what it describes as "timely implementation of structural reforms covering a wide range of governance and transparency issues in the fiscal and banking sectors will be critical in the period ahead." The IMF release states: "Criminal proceedings against former owners of those banks involved in the 2003 banking crisis should send a strong signal regarding the consequences of misconduct, and it will be important to ensure the proceedings are sufficiently comprehensive to include all concerned officials."
See http://www.imf.org/external/np/sec/pr/2006/pr0695.htm
Link To Original Article (http://www.dr1.com/index.html#7)