Miguel Ceara Hatton, the national secretary for public policies for the Modern Revolutionary Party (PRM), says the new government will be giving priority to people’s health. The Luis Abinader administration begins on 16 August 2020.
Speaking on the “Esta Noche con Mariasela” talk show, Ceara Hatton said: “The economy has to adjust itself to the needs of public health.”
He confirmed that the Covid-19 job support and social programs under the Medina administration would continue. “These have to be sustained,” he said. He said public spending will continue even if the fiscal deficit and debt increases.
He said there will not be a reduction in government spending, because this would bring on a recession. He shares international economic forecasts that the global economy will rebound in 2021 with strong growth. Meanwhile, he expects the DR will see a 3% drop in its GDP in 2020 with the collapse of the tourism sector and the decline in exports and foreign investment.
The priority of the next government is jobs; to create the conditions for people to find work and generate income, says economist Ceara Hatton.
He spoke of government actions to strengthen farming and small business with “small investments.” He said the focus is on backing sectors that can generate hard currency, including exporters and the tourism industry.
“The new government intends to revise all government spending, to eliminate ‘filtrations,’.” He said.
“We had identified 125 to 140 billion in savings that could be cut,” he said. “He says that after the government’s extraordinary spending since March, this now needs to be revised.
He explained that the government plans to implement what they are calling “the fiscal rule.” This means the plan is to allow for increases in spending but to a level of half the growth of government revenues. He said now President-elect Luis Abinader in his campaign committed to improve the quality of government spending. “Spend where it is needed, cut where it is not needed,” he said.
He mentioned that in cases such as having 50 employees on the government’s United Nations mission in New York, only three are needed. “That money we will spent better in health,” he said. He stressed spending will be the same, but there will be better spending.
He spoke of applying the law of efficiency.” Austerity is not lowering the level of spending because that would bring a recession, he says. “What you have to do is spend better.”
He said there is the National Salary Law that establishes that no one in government can make more than the President.
He said the original plan is that efficiency in spending would eliminate the gap between government spending and government revenues in a year. “Now we need to recalculate everything because of this new scenario,” he said. He remarked that the Abinader economic team had forecast in January that government revenues would grow 10%. Now they have collapsed.
He says the Abinader government will have to borrow. “The world has changed,” he explained. “Before budgetary help did not exist. An international organization would not lend money for that, today it exists because there is a situation that requires this,” he said. “There will be flexibility in rules to access credit and pay debt,” he said.
Esta Noche con Mariasela
Esta Noche con Mariasela
8 July 2020