Santo Domingo.– The former Dominican president, Danilo Medina (2012-2020) responded this Monday to the president Luis Abinaderafter the statements in which he defended his debt policy and stated that 80% of the loans contracted by his Government have been used to pay debts inherited from the past.
The former president described this argument as incorrect. and maintained that, if this had been the case, the public debt would not have increased so rapidly.
“If he had dedicated himself to paying overdue loans, his debt would not have increased at the level it is at. Today the debt is at 60,000 million dollars, because he found it at 35,000 and has taken it to 60,000; “That is not paying overdue debt,” said Medina when approached by the press after an event by the Dominican Liberation Party (PLD) in Santiago.
The economy cannot withstand that level of spending
Medina explained that the increase in debt is not justified with the argument of refinancing loans, since when an overdue debt is paid, it is not counted as a new obligation.
“If I owe 1,000 and I take 1,000 to pay it, I still owe 1,000; but if I take 1,500, then my debt grows by 500 more,” he exemplified.
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The former president warned that the current rate of debt growth is unsustainable, pointing out that the country will go from paying 298 billion in interest this year to 324 billion next year. “This economy will not resist this trend for long,” he warned.
“The President (Luis Abinader) has to review his level of spending, because the Dominican economy cannot withstand that level of spending,” the PLD president also insisted.
Public spending under the magnifying glass
Danilo Medina questioned the increase in state payroll and transfers to the electricity sector, which he said are putting pressure on public finances.
“It has to pay 111,000 million in transfers to the electricity sector this year, but next year that will reach 2,000 million dollars, approximately 120,000 million pesos,” he explained.
He indicated that the public payroll has gone from 204,000 to 358,000 million pesoswhich represents an additional 156,000 million, in addition to an increase of 32,000 million in pensions “of people who have not earned it.”
If this pace continues, he warned that current spending next year will reach 398,000 million pesos, “a figure that the Dominican economy will not have the resources to face, and that is extremely dangerous.”
