After 2020 in which the local economy fell -6.7%, the World Bank projects that the Dominican Republic will grow 9.1% this year. However, the chief economist of said entity for Latin America and the Caribbean, William Maloney, warns that the government of Luis Abinader has to pay attention to the deficit and the total debt of the country that has caused the pandemic.
In response to a question asked by Diario Libre during yesterday’s virtual presentation of a recent regional report by the agency, Maloney indicated that the Dominican Republic is an example of a good investment in the purchase of anti-viral vaccines, despite their weight in the budget.
“Obviously it cost (the country) a lot to buy vaccines, the deficit has increased because of that. However, the returns on this investment are very profitable. Obviously, at this point, we have to keep an eye on what is happening with the deficits and with the total debt, but this was clearly a good investment,” he said.
Between February 15 and September 10 of this 2021, the Government received 22,325,780 doses of vaccines from the pharmaceutical companies Sinovac, Astrazeneca, and Pfizer (and Sinopharm, donated).
The Executive Branch has defended the contract to purchase 9.9 million Pfizer vaccines for US$119.9 million. For 10 million of Astrazeneca’s it agreed to US$40 million. The amount of the Chinese Sinovac has not been disclosed.
At the end of last June, the Dominican consolidated public debt closed at US$59,648.5 million, its highest value historically. This represented 68% of gross domestic product (GDP) as of that month, according to figures compiled by Crédito Público.
As of June 2019, when the COVID-19 pandemic had not been declared, such debt – which includes the indebtedness of the non-financial public sector and that of the Central Bank – represented 50% of GDP.
The country’s consolidated external public debt alone was US$33,251.1 million as of June 2021, equivalent to 55.7% of the total consolidated debt owed.
The Minister of Finance, Jochi Vicente, has explained that the fiscal deficit in 2020 is a direct consequence of the pandemic. He indicated that the Government, in order to allocate resources to the health system and to comply with social subsidies, substantially increased its spending and, consequently, its indebtedness.
The coming ones
In the biannual report “Recovering Growth: Rebuilding Dynamic Post-Covid Economies with Budgetary Constraints”, presented yesterday, the World Bank compares the Dominican Republic with Belize, Chile, Panama, and Peru, which are also expected to grow at rates above 9%.
For 2022 and 2023 the projection is for the Dominican economy to grow 4.9 % in each year.
Source:
Diario Libre
