Investment banker Bear Stearns published a Sovereign Latin
\nAmerica Update, which brings optimistic tidings for the ailing Dominican peso
\nand the economy in general. The report estimates that the peso has recovered 5%
\nof its value in the past month, and that the economy may have already hit its
\nlowest point, setting the scene for a possible upturn.
\nThe US-based institution awards the DR a Ba2\/B+ rating, and attributes the
\npeso?s recent upward trend to the imminent IMF agreement, the restructuring of
\ntroubled banks Baninter, Bancr?dito, and Mercantil; US$1-billion CD issuance to
\nsoak up excess peso liquidity; increased tourism flows; robust remittances;
\nhigher exports and lower imports.
\nThe report says that tourism for the first half of the year has increased 21%
\ncompared to the same period last year, translating to 1.7 million foreign
\ntourists. Tourist revenues are cited as having expanded by more than 18%, from
\nUS$1.36 billion in the first half of 2002 to US$1.61 billion for the same period
\nin 2003.
\nRemittances were up 2.8%, to US$1.08 billion from US$1.05 billion in the first
\nhalf of 2002. Bear Stearns says that remittances have become a key contributor
\nto the country?s external accounts and represented a vital source of foreign
\nexchange during the crisis period.
\nLikewise, exports grew by 8.6% for the first half of 2003 to US$2.8 billion.
\nFree zone exports were up 5.7% and non-free zone exports 21.7%, boosted by the
\nweaker peso. Imports contracted 17.2% during the same period, causing the
\nmerchandise trade deficit for the first half year to fall to US$1.2 billion for
\nthe first half of 2003 from US$1.9 billion for the same period in 2002.
\nBear Stearns report (PDF):<\/p>\n
http:\/\/dr1.com\/news\/2003\/DR_Sov Update_082103.pdf<\/p>\n","protected":false},"excerpt":{"rendered":"
Investment banker Bear Stearns published a Sovereign Latin America Update, which brings optimistic tidings for the ailing Dominican peso and the economy in general. The report estimates that the peso has recovered 5% of its value in the past month, and that the economy may have already hit its lowest point, setting the scene for … <\/p>\n