What are Dominicans most concerned about?
Santo Domingo, DR
The public debt has nothing to do with it. And although many of us are concerned about it, for the majority of the people, its biggest problem is something else.
The fiscal deficit much less so. Only if they talk about fiscal reform, then the hairs stand on end.
Interest rates don’t count when it comes to borrowing money to buy a good. Instead, it is more important to take advantage of Black Friday specials, Christmas, or car shows.
Neither does the exchange rate, as long as the dollar is cheap and stable. Of course, inflation worries everyone, but it is cyclical and global, and in less than a year, prices will stabilize again.
And then, where is the problem?
Very simple. Employment. Not having a job or having one for a miserable salary and without social security (which is almost the same thing) is the drama of most Dominicans.
With a public sector that needs to be deflated, things are getting tough amid a pandemic that displaces thousands of employees.
In the private sector, the demand for employment is generally insufficient and very competitive. As a result, there are too many professionals, mid-level technicians, and skilled workers in all fields who cannot find work.
Let’s not forget the million Haitians who fill thousands of jobs, which the Dominicans are not interested in.
How to create formal jobs faster?
With more public investment and more private investment, the first is a political decision where the budget for investment spending must increase to at least 20% of total expenditure. In recent years, capital spending has been collapsing (14%) to make way for public employment that exceeds 700,000 people, 60% of them unnecessary.
Also, to finance a corrupt mafia that ruled the country for years.
As for private investment, it is necessary to improve legal security, revise some taxes, promote public-private alliances, eradicate corruption and break many obstacles in the administrative procedures to approve new investment projects in mining, tourism, energy, agribusiness, and infrastructure.
All this would help to achieve an investment-grade credit rating, and with that, everything would change. Foreign capital would flow in abundance. But that grade requires, above all, fiscal reform to ensure debt sustainability.