El Caribe reports that the government economic team, headed by Finance Minister Jose Lois Malkum, rejected the possibility of revoking its recently announced economic measures, whose main objective, he said, is to stabilize the exchange rate. The meeting took place yesterday, despite President Hipolito Mejia having said that the government would not meet with the business sector after repudiating the criticism of the CONEP spokeswoman, Elena Viyella, of the recent measures. Viyella said that the measures violated the Pact for Stability and Economic Development, which was accorded in December.
In addition to Malkum, the government?s economic team was also represented by Industry & Commerce Minister Sonia Guzman; Deputy Governor of the Monetary Board Luis Manuel Piantini and economic advisor to the President, Carlos Despradel. The private sector was represented by Viyella, Jose Clase, Lisandro Macarrulla, Frank Castillo, Rafael Blanco Canto and Irving Redondo ? all members of a commission to follow-up the pact.
Deputy governor of the Central Bank, Luis Manuel Piantini, told the press the authorities accept that the economy may only grow by one or two percent in the first quarter, but that the priority is to preserve macroeconomic stability. ?What is most important is to preserve stability?We cannot talk about economic growth because a world war is in the scenario and this is a difficult situation.? He trusts that once the international perspectives improve, the Dominican economy should grow more rapidly. Nevertheless, the government agreed to fiscal savings of 0.3 percent of the Gross Domestic Product.
The president of CONEP, Elena Viyella, said that both the private and public sectors agree that the Dominican economy is healthy and that the basic elements for growth and sustained development are present.
Meanwhile, Hoy newspaper reports that banks are engaged in discussions with the monetary authorities regarding the placement of investment certificates. ?To increase the interest rates to control the price of the dollar does not appear to be an adequate measure,? as one banker, who refused to openly go on record, summed up the situation. He said that such a decision would make borrowed money more expensive for companies, with the cost of commercial loans already at an all-time high.
Coincidentally, a team of economists from the International Monetary Fund was in the Dominican Republic on its routine annual visit. Philip Young, as head of the mission, told the press that the IMF could offer permanent advisory services to the Dominican Republic, if so requested by the local authorities. Leading Dominican businesspeople have requested that the Dominican government sign a monitoring agreement with the IMF as a first step in establishing transparency and accountability within the government. The government, however, feels that this is not necessary.