The CDEEE, the state-run energy business, reported yesterday that the government would continue its policy of subsidizing the energy supplied to the poorest areas of the major cities to the tune of US$80 million during the current fiscal year. This policy will continue in spite of IMF urgings to bring the subsidies to a halt. Radhames Segura, the administrator of the CDEEE, told reporters from El Caribe that even though the government was in no condition to subsidize the US$800 million required to meet the energy sector’s financial deficit, the US$80 million were already in the 206 budget as part of the Blackout Reduction Program (PRA).
Meanwhile, Ivan Reynoso, executive director of the Santiago Chamber of Commerce criticized the way the electricity system is set up. “We have to create a system that allows to sell energy to users that pay for it, not one that penalizes the clients that meet their payment obligations,” he commented. Interviewed along with Mario Abreu, president of the Santiago wholesalers (Amaprosan), and other business leaders, he concurred that the authorities have based the sustainability of the system on subsidies and that is no way to achieve a stable and competitive electricity system. Abreu pointed out that businesses are being hard hit by the 8% increase in electricity rates, plus the new ITBIS taxes and others that have come with the fiscal reform that is in effect starting this year.