President-elect Leonel Fernandez does not share Finance Minister Rafael Calderon?s optimism regarding the outlook for the Dominican economy. Calderon on Monday had expressed that the incoming PLD government would receive governmental affairs in better shape than that in which the Mejia administration received them in August 2000.
?When we handed over the administration in 2000, the Dominican economy was growing 10.2% and the foreign debt had declined from US$3.8 billion to US$3.6, and that was 18% of the Gross Domestic Product,? said Fernandez. He compared this to what he is getting back from the Mejia administration. ?Now we are going to receive an economy that will decline 2% this year and a foreign debt that has increased from 18% of the GDP to 60%, so if these are not the numbers, then he (Calderon) is right,? Fernandez is quoted in Hoy newspaper.
Vice President-elect Rafael Alburquerque added that the present situation is critical. He said that inflation is at 42.8% and the exchange rate had reached RD$50-US$1, aside from the enormous quasi-fiscal debt, made up by the savings certificates deposited in the Central Bank.
Danilo Medina, another spokesman for the succeeding administration, said that the present government will need to confront a US$400-million power generation debt, as well as the uncertainty of whether it has an agreement with the IMF or not.
Temistocles Montas, one of the new government?s key economists, told Hoy newspaper that Calderon?s statements prove he is living on another planet.
The PLD representatives met with the press during a meeting among Fernandez, key PLD government officers and farmers at the Hotel Embajador yesterday.
Calderon had criticized the fact that incoming officials of the next government were making statements that they would be taking over a difficult situation.
As reported in Hoy newspaper on Saturday, 5 June, Calderon had told journalists who interviewed him the day before at the Presidential Palace that in financial terms, the incoming authorities would have it easy because the government is receiving record tax collections. He mentioned that the government is receiving 16% more in revenues than was budgeted for this year.
Calderon stated that the surplus in the current accounts of the economy is 5% more than state spending. In his view, this means that the public and private sectors are generating more than they are expending. Calderon also says that while inflation in 2003 was 42%, so far this year it stands at 7%, one of the lowest of past years. Ever the optimist, he expects this trend to continue. He furthermore stated that foreign investment is up and mentioned the installation of new free zone companies as part of a US$200-million investment. Calderon spoke of the absolute control that the government has over its spending, which he says has been recognized by international organizations. He justified the fact that there was more spending in the first quarter of the year owing to commitments due in hard currency that were superior to the revenues received in hard currency. Among other achievements during his post as finance minister, Calderon is remembered for his strong support of the railway concession project approved during the Mejia administration.