NewsWhore
09-04-2009, 06:20 PM
Arturo Martinez Moya, the president of the Dominican Revolutionary Party's economic commission, told reporters that there is no need to place US$1 billion in sovereign bonds, such as the government is trying to do once it signs an agreement with the International Monetary Fund. He speculated that the main priority of the government is to reduce the "financial blackouts" and that this would be covered by the US$750 million in funds from the World Bank and the Inter-American Development Bank (IDB).
Martinez Moya pointed out in a written release to the media that the new stand by agreement with the IMF should mean an improvement in the quality of public spending and put a brake on the frenzied race of foreign indebtedness. He says recent borrowing has concentrated on contracting expensive loans that come with little controls and thus are open to corruption.
Martinez suggested that to free up resources the Central Bank should register as a contribution of capital the nearly RD$10 billion (US$275 million) that in Special Drawing Rights (SDRs) the bank received from the IMF.
He said that the Central Bank does not have an obligation to pay interest nor to return the IMF resources and it can use them at its convenience. By registering the funds in its books this way, the government would commit to return them in 2010 and 2011.
Finally, the former Central Bank governor said that as a result of the poor handling of the public finances, the fiscal accounts are showing a deficit of RD$28 billion as of 20 June 2009. This includes RD$15 billion in capitalization funds for the Central Bank, the accumulated debt in the electric sector and debts with suppliers and other creditors.
More... (http://www.dr1.com/index.html#5)
Martinez Moya pointed out in a written release to the media that the new stand by agreement with the IMF should mean an improvement in the quality of public spending and put a brake on the frenzied race of foreign indebtedness. He says recent borrowing has concentrated on contracting expensive loans that come with little controls and thus are open to corruption.
Martinez suggested that to free up resources the Central Bank should register as a contribution of capital the nearly RD$10 billion (US$275 million) that in Special Drawing Rights (SDRs) the bank received from the IMF.
He said that the Central Bank does not have an obligation to pay interest nor to return the IMF resources and it can use them at its convenience. By registering the funds in its books this way, the government would commit to return them in 2010 and 2011.
Finally, the former Central Bank governor said that as a result of the poor handling of the public finances, the fiscal accounts are showing a deficit of RD$28 billion as of 20 June 2009. This includes RD$15 billion in capitalization funds for the Central Bank, the accumulated debt in the electric sector and debts with suppliers and other creditors.
More... (http://www.dr1.com/index.html#5)