Government concern at social unrest

[NewsWhore]

The Dominican government's lack of financial capacity to protect the most vulnerable social sectors is provoking a dangerous social crisis at an accelerated rate that could end up creating serious governance problems. Dominican Minister of Hacienda Vicente Bengoa made this warning during a speech to the annual Inter-American Development Bank (IDB) governor's conference in the Colombian city of Medellin. Bengoa said that what is happening in the Dominican Republic is similar to what is occurring in the rest of Latin America, so that if the region also falls into a recession there is a good chance that the United States would also experience worse conditions. Bengoa told the IDB assembly that the achievements by the country in the last few years now face a serious threat, with the additional problem that the Dominican economy is experiencing a process of deceleration that could end up as a recession if the state, through public spending, does not expand internal demand. He referred to the external shock of 2008 that went from a fiscal surplus of 0.3% in 2007 to a fiscal deficit of 3.4% in 2008. The official cited the fact that so far this year - as of 26 March - there has been an unprecedented fall off of nearly 7% in revenues from what was projected. This situation, he said, limits the government's capacity to compensate for the fall in private activity and stimulate the economy through an increase in public spending.

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