An El Caribe newspaper editorial comments that a US$83 million loan from private banks to the government to pay power bills would violate banking norms. National legislation limits the amount of money that banks can lend to one client. The editorial states that the government has already borrowed US$65 million to pay foreign debts and continue public works, expecting to pay this money back with the US$500 million sovereign bonds. The editorial explains this would mean the government now has at least US$148 million outstanding with local banks. The editorial warns that the government borrowing could trigger another increase in interest rates and a decrease in funds available to the private sector. The newspaper urges the government to cut its bulging payroll and eliminate subsidies. El Caribe recently reported that the Mejia administration has spent 12% more in the first half of this year than the previous government did in the same period last year. Jochi Vicente, president of the National Association of Young businessmen, warned yesterday about a lack of control in government spending.
