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Santo Domingo.- The economic recovery achieved by the Dominican Republic in the face of the health crisis generated by the coronavirus has been labeled a success story by the international community, highlighting the opinions of the most prestigious risk rating agencies, the most prestigious institutions representatives of international banking and various multilateral organizations.
According to a press release by the Central Bank, in general terms, all these entities have favorably weighed the implementation of macroeconomic policies consistent with the objectives of achieving the recovery of productive activities, of recovering jobs and of protect the most vulnerable segments of the population.
The Central Bank highlights that during the year just ended it launched an expansive monetary policy that included the reduction of the reference interest rate from 4.5% to 3.0% and the implementation of various liquidity mechanisms, aimed at creating the conditions so that financial institutions could place and / or refinance low-cost loans to Dominican businesses and households.
“At the same time, the government designed social programs to protect the most defenseless groups of the population and made the tax burden of companies more flexible, particularly those sectors most affected by the pandemic, preserving jobs and protecting people’s income.”
At face value this economic recovery is good. However, someday the bill is going to come due for all the loans and favors the government made to keep the country’s head above water.
For example, don’t think the monetary assistance Barrick Gold provided the country during this pandemic was done without its agenda to have the favor repaid with compromises from the government.
It is almost certain the government is formulating a multitude of reforms to acquire revenue from the public to cover its spending and debts so the country can continue to at least be able to tread water. Will these changes cut into economic growth?
50% of the population is poor. 25% living in poverty.Simple changes such as making it simpler to get ID cards would help. And raising salaries in the service sector.