IMF report a mixed bag on Dominican economy

Santo Domingo.- The rising debt stymied the Administration’soverall balance from 2005 to 2014, whenthe Non-Financial Public Sector Liabilities (NFPS) tripled, to 53% of GDP by2014, by related to the losses derived from the local financial crisis of 2003and loans to finance the fiscal deficit.

According to documents prepared by InternationalMonetary Fund (IMF) technicians, that makes the government "currently themost vulnerable sector of the economy."

The report, which does not necessarilyrepresents the IMF position, was presented by Joseph Saboin and Svetlana Cerovic,one of the economists who’s part of the IMF mission currently in the countryassessing the economy.

State pension fund

The report notes that commercial banks and thepension fund have been the government’s main sources of funding.

Loans in the local market jumped between 2008and 2009, when external conditions were unfavorable for the internationalfinancial crisis.

The government’s net financial positionimproved between 2010 and 2011, but worsened again in 2012 with a notable increasein the deficit, which led to an expansion of foreign currency funding.

The report suggests that in addition toforeign loans, the country has attracted significant resources throughgovernment bonds, so much so that by that date, non-residents held 55% of thetotal government debt.