Mario Mendez, economic editor for Hoy newspaper, says the Dominican people are paying a dear price for the government’s “error” of plowing ahead with the purchase of the power distributors in August 2003 without authorization from the International Monetary Fund. The country had just signed an agreement with the IMF that established ceilings on government indebtedness, when the authorities announced the buyback of the Edes from the Spanish Union Fenosa. At the time, the Central Bank Governor Jose Lois Malkun was in Dubai attending an international conference. As a result, the IMF quickly suspended the agreement and the DR was obliged to negotiate a new agreement – one that Mendez says will cost taxpayers much more. He said that in the first agreement drawn up in mid-2003 the inflation estimated for year-end was 35%. Following the suspension and renegotiation, inflation was re-pegged at 42.7%. Mendez says that the agreement had estimated inflation for 2004 in the single digits, but the revised letter of intent prepared for the resumption of the agreement with the IMF now establishes a 14% inflation rate for 2004. The new agreement also speaks of a 9.5% inflation rate for 2005, up from 5% recorded in the first agreement.