Economists criticize government borrowing

posted on: Mar 8 2010 12:26 by Royston. Viewed 82 times.


Two economists yesterday criticized the way the government of President Leonel Fernández, in just two years, has borrowed 2,523 million US dollars, equivalent to 91,347.8 million pesos.

Economists Porfirio García Fernández and Jaime Aristy Escuder, speaking separately, said the country is exceeding the debt limit.

Garcia Fernandez understands that although President Fernández was forced to implement an aggressive policy of lending to counter the effects of the global crisis, he considers the number of loans that the country is taking to be excessive.
"What we have to ask is how the country will repay these loans. From 2008 to date, the country has taken loans totalling more than US$2,200 billion, not counting one billion US dollars of sovereign bonds," he said.

He said it is unfortunate that for the first time ever the budget is supported by 30 percent external and internal borrowing, and he called on the Government to be more cautious and not put the country into so much debt.

Aristy Escuder also called the accelerated  loan process excessive. He complained that the government was violating the agreement with the IMF in asking Congress for authorization to issue one billion dollars in sovereign bonds.

The Dominican Federation of Chambers of Commerce (FEDOCÁMARAS) also criticized the approval by Congress, in two consecutive readings, of procuring funding of one billion dollars in sovereign bonds, supposedly to be used in infrastructure projects. They argued that too much of the countries resources would have to be utilized in debt repayment