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Santo Domingo. - International Monetary Fund (IMF) Foreign Relations Dept. director Gerry Rice warned Thursday that if the 7th and 8th revisions in the Standby agreement with Dominican Republic aren’t complied with, “the program would expire at the end of February and the beginning of March.”

He said however that the IMF continues debating the agreement’s extension with Dominican authorities and noted that it was Central banker Héctor Valdez Albizú who made proposal of another six months, which would include next August. “The Fund maintains a close dialogue with the authorities.”

After a press conference Thursday on the IMF Website, Rice said of a total of US$1.7 billion stipulated in the agreement with the Dominican Government, thus far the entity has disbursed US$1.2 billion until its sixth revision.

He added that the 7th and 8th revision are still pending, halted after the IMF demanded that the local authorities increase the light bill 18%, measure which the Dominican Government hasn’t complied with so far, arguing an additional burden for the population, especially in a year of presidential election.

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COMMENTS
11 comment(s)
Written by: zooma, 10 Feb 2012 9:09 AM
From: United States

The IMF is out of touch with reality on this one. Rather than force the gov't to increase the tariff 18% on those who pay, the focus should be for the government to go after those who steal and those who don't pay.

This is a typical example of bean counters making edicts from the insulated world of glass towers having no idea what is happening on the street.



Written by: foresthill, 10 Feb 2012 9:41 AM
From: Dominican Republic
wrong zooma,

The theft is by the government and right now the DR government relies on borrowing money in order to pay its commitments.

When a lender sees no oppurtunity by the borrower to repay the money or interest then like any bank it will attempt to secure its loan.

There is no area in which the DR government can raise the new money needed so it will have to raise something it can control and that is electricity.
Written by: dreadlocks, 10 Feb 2012 10:35 AM
From: United States
politics meets reality/ as i said, the PLD does not want to raise the electricity costs to the nation in the immediate months before an election. the IMF says otherwise. let us see who blinks first.
Written by: RoyStone, 10 Feb 2012 10:42 AM
From: Australia
As I have said previously, no matter who wins the election, we are in for a lot of pain after election. The only question that remains, is who will suffer the most.
Written by: WalterPolo, 10 Feb 2012 11:17 AM
From: Dominican Republic, Puerto Plata
Raising the electric bill will be assumed by either one of Danny Low or the Hippo.

And Leo will save his credits with th IMF for 2016.
Written by: RoyStone, 10 Feb 2012 11:27 AM
From: Australia
Maybe after the election, and after the sh*t hits the fan, Danelo will be the sacrificial lamb for the country's salvation, and it will be time for Queen Margareta's coronation?
Written by: Ricardolito, 10 Feb 2012 1:28 PM
From: Dominican Republic, vieja Santo Domingo
some months ago I wrote that the IMF wanted the 17% increase and juanb called me a total liar ..but nevertheless I would not cave in to the IMF and mereley request that the revenue rises by 17 % this can be done by more meters and less cheating
Written by: RoyStone, 10 Feb 2012 1:37 PM
From: Australia
Ricky, the meters would be stolen then sold as scrap, after first being bypassed by consumers. Maybe the smart one will reverse them so their accounts are always in credit, and they get regular refunds? Very Dominican!



Written by: dreadlocks, 10 Feb 2012 2:07 PM
From: United States
Written by: RoyStone, 10 Feb 2012 11:27 AM
From: Australia
Maybe after the election, and after the sh*t hits the fan, Danelo will be the sacrificial lamb for the country's salvation, and it will be time for Queen Margareta's coronation?

whoever wins is in for a torrid ride. if the PLD goes ahead with the light increase, there goes any hope of winning the election. so, Hippo wins. but Hippo is not a fan of the IMF, and vice versa. so, there goes the standby arrangement, not to mention any more work on the Metro, which Hippo rejected, from the beginning. so, what does Hippo do? devalue, and attract more race to the bottom FDI and Hot Money? what is a guy to do? i am curious to see how this turns out.
Written by: tomito, 13 Feb 2012 1:17 AM
From: United States
If I had to bet, my money would be on the government not raising a penny before the election, historically the DR government has pretty much had its way with the IMF with the exception of Hippo who ignored the IMF warnings and repurchased the Edes causing the standby agreement to break, anyway the risk of losing the election over this by far weighs more than an IMF agreement that would be renegotiated after the fact anyway and as usual. The DR loves money at low interest rates from this so called " lender of last resort" which of course it sees as a "lender of first resort" at such good rates. Too bad DSK is not in charge of the IMF anymore, since his favorite tour in Boca Chica along with a few cold ones would have solved this "minor" problem.
Written by: josean, 13 Feb 2012 1:45 AM
From: United States, Show your Love for DR Vote AGAINST the PLD!

“Industrial sectors fear over the top spending on the ruling party’s campaign”

“SANTO DOMINGO (Dominican Republic).-The small and medium industry sector today expressed their fear that letting the standby agreement (for financial assistance) with the International Monetary Fund (IMF) expire, will lead to uncontrolled public spending by the government during the electoral period and will result negatively affecting the macroeconomic stability of the country.”

http://www.7dias.com.do/app/article.aspx?id=115382
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