2003News

Business worried about the cost of money

Representatives of the Dominican Federation of Merchants (FDC) and the Association of Industries of the Dominican Republic (AIRD) told the List?n Diario newspaper of their concerns over the effects the recent Central Bank savings certificates could have on the cost of money to the private sector. The Central Bank is offering RD$5 billion in certificates to the general public at interest rates of 24-28%. 
Ivan de Jes?s Garc?a, of the FDC, told reporters that businesspeople and the members of the industrial sector can only hope that this is a short-term mechanism and that some compensatory measures will be forthcoming. Garc?a told reporters that lending interest rates could climb to 50%, which most businesses could not afford to pay. 
Lisandro Macarrulla, the head of the AIRD, told the press that there was no way legal businesses could absorb such high costs of money. He said interests rates are already hovering at around 40% due to the government curtailing the money supply in order to force the exchange rate downward. At these levels, Macarrulla warned that many businesses would not be able to meet their financial obligations. Garc?a said that general sales have fallen between 22-25% in the face of the rising costs.