2004News

Government could go looking

The Diario Libre reports that the Dominican government could go looking for as much as US$100 million to pay some of its creditors. The country has to cover a shortfall in the balance of payments for about the same sum in relation to the amount of money that was not successfully renegotiated at the Paris Club talks last week. If the government does not successfully find this financial package, it will have to deal with each of its private creditors, including businesses, banks, sovereign bondholders and other non-Paris Club creditors, individually. Apolinar Veloz, one of the managers at the Central Bank, told reporters that the IMF had estimated in December that there would be a deficit in the balance of payments of about US$320 million, but at the moment of the negotiations, this sum was adjusted to US$293 million due to a lower inflation, a slight strengthening of the peso and a modest predicted growth which all appeared to slow the flight of capital. Veloz said that the US$293 million is currently being renegotiated and that since there are neither problems of solvency nor sustainability, the ?classic terms? were the ones applied, giving the country 12 years to repay the money.