The Center for Economic Research in the Antilles, Cenantillas, says in its most recent newsletter that the 2003 budget threatens the economic stability of the nation and is an obstacle that will severely limit the capacity of the government to seek investments from the private sector.
The newsletter says that the government must start a program to reduce the public spending, if it hopes to avoid the spectacle of further peso devaluation.
Cenantillas says that one of the central problems is that as much as 70 percent of government investments rely on financing from external resources.
In another criticism of current government policies, Cenantillas says that the budget for 2003 does not take into account the US$600-million sovereign bond issuance, nor the RD$3 billion produced by the taxes imposed on exchange transactions. These monies will be handled independently of the Budget, a factor that Cenantillas considers as potentially dangerous.
These problems, along with the 40 percent devaluation of the peso over the past 11 months and the 11 percent inflation suffered in the same period, make the preemptive measures called for from the government all the more urgent.
