The Minister of FinanceJosé Manuel (Jochi) Vicente, attributed this Thursday the decrease in the public debtduring the first quarter of this 2022, to 47.2 percent of the Gross Domestic Product (GDP) to good government management.
The official was interviewed by journalists after a meeting he attended to explain to the members of the Permanent Commission of Budget, Patrimony and Accounting of the Chamber of Deputies details of the report public debt January-March 2022, which was presented to the National Congress as part of a legal requirement.
When questioned about the meeting, he explained that the most important thing they discussed was about “the downward trend that the debt has had as a percentage of GDP after the growth it had due to the pandemic and the efforts that we are making from the Ministry of Finance to ensure that this trajectory of the debt continues to descend”.
He explained that the COVID-19 pandemic forced the country to borrow significantly to meet the needs generated. He gave as an example the purchase of vaccines against this viral disease and social assistance programs, which caused the debt of the non-financial public sector to go from 40.4 percent of GDP to 56.6 percent of GDP in 2020.
He highlighted that in 2021, as a result of fiscal consolidation, a reduction in the deficit was achieved in relation to what was budgeted and that influenced the public debt decrease from 56.6 to 50.4 percent of GDP.
Regarding the current year, he explained that: “our projection is that it will be similar to how it closed in 2021 or slightly below, obviously there are many factors that affect it, but depending on market conditions, we must continue to see that trend decreasing debt.
The official said that thanks to the good management of the debt, the Dominican government recently received the recognition “Sovereign Liability Management Operation of the Year”, as part of the annual awards given by the prestigious financial magazine LatinFinancecorresponding to the year 2021.
According to the last report of the General Directorate of Public Credit, of the Ministry of Finance, as of March 31, 2022, the balance of the external and internal debt of the non-financial public sector (SPNF) totaled US$50,503.6 millionequivalent to 47.1 percent of the estimated GDP.
According to José -Bertico- Santana, member of the Permanent Commission of Budget, Patrimony and Accounting, the Minister of Finance attributed the decrease in debt to the management that the government has had in relation to investment and to the fact that the economy has been growing, which reduces the need to incur new financing.
He highlighted that the public debt ended 2021 at 52 percent of GDP.
will submit another report
On the other hand, Santana revealed that the official promised to present them with a report on the renegotiations of the public debt with multilateral organizations, at the request of the Permanent Commission of Finance.
He said that the Government managed to reclassify the debt so that those financings that were about to expire and had to be paid quickly were postponed, which allowed them to use those economic resources in development plans and current expenses.
He revealed that according to the explanations they received, the Ministry of Finance is promoting that the Government obtain financing with multilateral organizations, because these financial commitments allow greater slack in account of payment terms and interest, because they are lower than the bonds.
Santana assured that the members of the Permanent Commission of Budget, Patrimony and Accounting, chaired by deputy Napoleón López, including those from opposition parties, were satisfied with Vicente’s very convincing and precise explanations.
