The Non-Financial Public Sector (NFPS) debt stood at US$44.68 billion at the close of December 2020, reports Diario Libre. The amount is an increase of US$8.74 billion over the US$35.94 billion at the end of 2019.
This is the largest increase in debt recorded in the last five decades and reflects the Medina and Abinader administrations actions to curb the spread of Covid-19 and reactivate the economy.
Of the new debt, most was contracted through sovereign bond issues that totaled US$5.65 billion by the end of last year. The accumulated amount of commitments with external debt holders was US$22.16 billion, reports Diario Libre.
The Dominican government also resorted to loans from multilateral organizations, which increased from US$5.04 billion in 2019 to US$6.58 billion at the close of last year.
Meanwhile, domestic debt went from US$12.56 billion to US$13.98 billion at the end of 2020.
The NFPS debt includes only the commitments assumed by the central government, and does not consider the indebtedness assumed by the Central Bank.
As of September 2020, the country’s total debt stood at US$51.95 billion, an amount equivalent to 66% of the Gross Domestic Product (GDP).
The increase in the debt to GDP ratio, which at the close of 2019 was 50.5%, is attributed both to the taking on more debt and to the decline in the size of the Dominican economy, both caused by the Covid-19 pandemic.
According to preliminary data managed by the Central Bank of the Dominican Republic, the Dominican GDP has shrunk by 6.7%. The government expects the economy to recover. The forecast is for 6% growth of the GDP by the end of this year.
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Diario Libre
26 January 2021