Economist Ernesto Selman of the Regional Center for Sustainable Economic Strategies (CREES) says that Dominicans are saving more. He said despite authorities lowering the lending interest rate and making available cash flow relief programs, businesses borrowing is down 3%, from 2 March to 24 August 2020. Borrowing declined RD$40 billion.
“People do not want to take on new debt because the perspectives for the future are not clear,” he explains. He said fiscal and monetary stimulus plans could become a problem in the next 12 months. Private borrowing is down, yet savings in US$ are up, he says. From July 2019 to July 2020 the savings in US dollar currency increased by 47%. Savings are up from US$2.87 billion to US$9.06 billion.
The governmental Banco de Reservas has announced it has available RD$5 billion in low cost loans for small businesses to help these with their cash flow during the Covid-19 epidemic.
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El Dia
Banco de Reservas
CREES
2 September 2020