Leading business sector representatives Lisandro Macarulla, Marisol Vicens and Iv?n Garc?a have called on the monetary authorities to reverse a measure announced by the Central Bank earlier this week to issue RD$10 billion worth of savings certificates. They believe the issuance will ?cool down? the economy because it will result in a rise in interest rates, reports the List?n Diario. The List?n, which was taken over by the government as a result of the Baninter collapse, is quick to point out that other economic experts have hailed the measure. Macarulla, who is the president of the Dominican Association of Industrialists (AIRD), is of the view that the release of the certificates is aimed at lowering the peso-dollar exchange rate, ?because the rise in the dollar rate has not responded to any of the other measures taken by the authorities.? The interest rates offered by the Central Bank (32%-36%) are cause for concern, says Iv?n Garc?a, because this will encourage other banks to increase their rates as well. The consequence of this, according to Garc?a, would be for businesses to be discouraged from taking on loans for new ventures. He warned that interest rates could soar to as high as 55%, and his views were shared by businessman Jos? Antonio Najri, vice-president of the PRD. Najri called on the Monetary Board to reconsider the decision, saying it could result in ?disaster? for the country?s productive sectors. Marisol Vincens, president of the young entrepreneurs association (ANJE), implored the authorities to abandon this course of action and demanded a clear explanation of the thinking behind the measure that she said would ?distort the national economy.? The List?n quotes economists Jos? Luis de Ram?n and Arturo Mart?nez Moya, who support the decision to issue saving s certificates. They see the move as ?a response to the IMF requirements? that will reduce the amount of money taken out of circulation. Andres Aybar, president of the Banco Mercantil and former head of the American Chamber of Commerce, said that he was concerned about the effect of the issuance on the financial sector, but understands that its premise is based on one of the IMF?s demands ? to reverse the devaluation of the peso. Most economic experts, such as Pedro Silverio and others quoted in El Caribe, believe, however, that the certificates will have the opposite effect: that they will increase devaluation, inflation and unemployment. El Caribe?s editorial maintains that the government had no choice but to make the issuance. As the IMF accord is likely to be signed in a few days? time, the editorialist opines that the measure will be short-lived. The writer also reminds readers that all steps taken so far by the monetary authorities have been unsuccessful, and that there are other measures to be considered, such as the reduction of the public payroll and expenditures on electoral campaigning. He concludes by saying that just as some declare war in the name of peace, imprison in the name of liberty or kill in the name of God, the government may be doing something comparable in the name of economic recovery.
The dollar-peso exchange rate fell slightly yesterday, and is now hovering just above RD$35.