There Seems to Be a Misprint

Ken

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Jan 1, 2002
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This item was in today's dr1 news summary:

"Hotel sector favors higher for-ex rate
According to the Presidents of the Association for the Tourist Development of Juan Dolio and Guayacanes and the Association of Hotels of the Eastern Region of the DR, Radhames Martinez Aponte and Ernesto Veloz, respectively, the hotel sector cannot continue to operate with a foreign exchange rate of RD$33 to US$1. Listin Diario reports they are suggesting that the government raise the minimum rate to RD$30 to one so they can regain the competitiveness they have lost in relation to other destinations. Yesterday, commercial banks closed operations selling the US currency at RD$33.10 to RD$33.15 for each US$1.00, whereas the purchasing rate was at RD$33.00 and RD$32.25, a 40-cent reduction compared to last Friday."

If they want a higher rate than RD$33 to 1, why would they want the minimum rate raised to RD$30?

What rate are they asking for?
 
L

LarrySpencer

Guest
because you have to think backwards....raising the rate for Dominicans would be to lower the ratio, making the RD closer to the USD. So what the hotels are saying is that they are losing by the transference of DPs to USDs right now, which is cutting in on their profits.
 

Ken

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Jan 1, 2002
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LarrySpencer said:
because you have to think backwards....raising the rate for Dominicans would be to lower the ratio, making the RD closer to the USD. So what the hotels are saying is that they are losing by the transference of DPs to USDs right now, which is cutting in on their profits.
Larry, would you please repeat that in English?

Are you saying that the resort industry that previously was lobbying for an exchange rate of 36 or 37 1 in order to maintain a competitive position has reversed itself and now wants it to be 30 to 1. If that is the case, then why not 25 to 1? I'm sure the government would like to get a lot of pressure to make that the rate since it needs fewer pesos in order to pay its foreign debt.
 

Conchman

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Its one of two things, either

1) The hotels in Juan Dolio and La Romana do not compete for the US$ market but for the local market (domestic tourism) and would therefore be helped by a lower exchange rate as their income in pesos would be worth more.

or

2) They made a mistake in reporting
 

anneeoakland

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Feb 12, 2005
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And dont' the hotels want to attract more foreign tourist dollars?


And for the hotels in the local market, as Couchmen said, I don't think the exchange rate should matter. Their customers pay in pesos and they pay their vendors and employees in pesos.
 

BushBaby

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You are right Ken, it WAS a misprint or a mistake in reporting. The press stated that TWO of the hotel chainss had suggested a 37:1 exchange rate & this had been argued by the Business community who favoured the 30:1 exchange rate!!

So - hotels were looking for 37:1 to remain competitive against other countries
Business were looking for 30:1
Doubtless todays writer of the Daily News will correct the misprint.

Things SHOULD remain about the same but might increase up to 34 or 35:1!! ~ GWB.