Finance Minister José Manuel (Jochi) Vicente reported that the public debt of the Dominican Republic closed 2022 representing 59.1% of gross domestic product (GDP), a percentage lower than the 61.0% registered in August 2020.
“And we achieved this despite having faced the largest external shock in history and inflation caused by the invasion of Russia,” the minister wrote in a series of tweets.
He pointed out that the reduction in the debt of the Non-Financial Public Sector has been greater than the consolidated one. He observed that in August 2020, when the Modern Revolutionary Party (PRM) came to power, it entered with a coefficient of 49.7% of GDP and at the preliminary end of 2022 it ended at 46.1%.
However, when these percentages are converted to monetary values, this debt reflects an increase in its amount.
According to the latest update of the public debt reports published by the Ministry of Finance, as of September 2020, the debt of the Non-Financial Public Sector totaled 43,091.1 million dollars and rose to 52,264.4 million dollars as of November 2022, for an increase of 9,173.27 million dollars.
“The government has been recognized for its timely management of the debt by the IMF (International Monetary Fund) in its article IV, which concludes that the public debt of our country is sustainable and that the policies that have been adopted are adequate,” the minister tweeted.
As of November 2022, nominal GDP stood at 113,259.6 million dollars, higher than the 94,523.7 million in 2021.
Growth of external debt
Despite the fact that public debt represents a lower proportionality with respect to GDP, the country’s external debt continued to rise last year. As of November, it totaled 36,375.7 million dollars, which represented 32.1% of GDP, according to data published by the Treasury.
Key: External debt of the non-financial public sector 2018-2022
External Debt %GDP
Source: Treasury Dept Author: Diario Libre
Preliminary figures*
The Inter-American Development Bank (IDB), with 3,966.8 million dollars, and the World Bank, with 1,169.8 million dollars, remain the country’s main multilateral creditors, representing 10.9% and 3.2%, respectively, of the debt of the Non-Financial Public Sector.
Meanwhile, the Development Bank of Latin America (CAF) increased its share of external debt. When between 2018-2021 its annual amount did not exceed 180.4 million dollars, as of November last year it was 414.5 million dollars, for 1.1%.
Another debt that rose, among the bilateral ones, is the one that the country has with Japan. When it did not reach 22 million dollars a year between 2018-2021, as of November 2022 it totaled 204.6 million dollars, according to Treasury data. Its percentage of representation was only 0.6%.
The largest proportion of the external debt of the Non-Financial Public Sector corresponds to bonds, which totaled 27,738.4 million dollars as of November 2022, for 76.3%.
“The proactive borrowing strategy we have implemented is evidenced by the 3 liability management transactions that have decreased the cost of debt and increased the average maturity of the portfolio,” Vicente wrote on his Twitter account.
He assured that, in 2023, the government will continue with the “proactive management of the debt” to continue guaranteeing its sustainability and get even closer to the goal of obtaining Investment Grade by risk rating agencies.
Source:
Diario Libre