The growth of the Dominican debt is in direct proportion to increasing corruption in government in the DR, said economists participating in the forum, “Public Debt, Corruption and Poverty” held yesterday at the Hotel Lina. The event was organized by the Transparency Table and the Economy and Trade Table of the Citizens Forum group. Economists reported that the foreign debt as of April 2009 was at US$7.08 billion, up from US$2.78 billion in 2000.
The economists stressed that the whole picture of the debt had to be presented.
When adding in domestic debt, the overall debt is closer to US$15 billion.
Francisco Checo, of the Center for Economic Investigations of the Caribbean (Cieca) says that by 2015 every Dominican will owe US$1,500, which would place the DR among the three or four most per-capita indebted countries in the region.
Checo, a former coordinator of the civic group, Participacion Ciudadana, explained that more that 50% of the debt of the country is bilateral with countries. The debt with PetroCaribe of Venezuela for oil purchases being the highest. 25% of the debt is with private debtors, and another 50% with multilateral organizations , such as the Interamerican Development Bank, World Bank.
Checo explained the Central Bank, to counter effects of the financial crisis on the stability of the local economy has taken on debt for US$3.98 billion and another US$4.19 billion locally. As a result, the total debt of the Dominican government is at US$15.26 billion, as reported in the Listin Diario.
The domestic debt increased from US$466 million in 2000 to US$4.2 billion in 2009.
Thus, while the foreign debt increased 2.6 times, the domesticdebt is up 9 times. President Leonel Fernandez had campaigned for his return to the Presidency in 2004, criticizing the debt taken on by his predecessor, Hipolito Mejia.
The economists say that the foreign debt of the DR could reach a record high of US$13 billion by the end of the Fernandez administration in 2012 if the government maintains its pace of borrowing, according to a report in El Caribe.
As reported in El Caribe, economist Isidoro Santana said that a large part of the debt has been contracted to resolve the energy situation, which continues at its worst despite bilions spent by the government.
Santana says that corruption is one of the leading obstacles to the implementing of socially efficient government policies.