Loans in Congress exceed $ 12 billion –

Loans in Congress exceed $ 12 billion

Paul Mathiasen
Santo Domingo, RD.-At least 14 possibilities of indebtedness, for an amount greater than 12 billion dollars, have been handled by the National Congress since the start of the new legislative train on August 16.

Specifically, to date the senators and deputies have had in their hands 11 loan contracts, signed by the Executive Power, for a sum greater than 1.5 billion dollars and just over 11 billion dollars to authorize for the placement. of public debt securities or “sovereign bonds”.

So far, both legislative chambers have approved 11 possible indebtedness so that the Executive Power has more resources, prioritizing the health crisis that the country is experiencing. However, not all the money appears to be aimed at the COVID-19 pandemic.

The beginning of the indebtedness of the new legislative train began with the approval of the bill that modifies the already approved general budget of the State, or supplementary budget, for the year 2020. In this the Ministry of Finance was authorized to place 3.8 billion dollars in sovereign bonds.

At that time, both the Treasury and the President of the Republic, Luis Abinader, justified that the largest placement of debt securities in the history of the country was to keep the social plans initiated by the past government in force, as well as to mitigate the effects of the COIVD-19 pandemic.

After a few months, between October 14 and December 15, both houses approved four more loans for an amount greater than 621 million dollars. But the detail is, in that only one of those three loans approved in that period had as justification something related to the COVID-19 pandemic.

For 100 million dollars, Congress approved a loan contract signed with the International Bank for Reconstruction and Development (IBRD) to develop a “Development Policy Program in support of the Dominican Republic’s response to the COVID-19 crisis. ”.

The other three loans, two were signed with the French Development Agency (AFD) and one with the Inter-American Development Bank (IDB); for an amount greater than 521 million dollars.

Of these, 500 million would be used for the “Support Program for Mobility, Land Transportation and Road Safety in the Dominican Republic” and the remainder for the purpose of “financing and refinancing the eligible expenses of the project designated for the agroforestry and comprehensive management of natural resources implemented by the non-profit association Plan Sierra on the southern slopes of the middle and upper basin of the Yaque del Norte River ”.

Subsequently, and before the end of 2020, Congress approved the new general budget law of the State for 2021, where the Ministry of Finance was authorized to place sovereign bonds worth 2.5 billion dollars.

The Legislative Branch also approved a law to “issue and place public debt securities for a maximum amount of up to two hundred ninety-one thousand five hundred twenty-eight million four hundred eighty-seven thousand one hundred fifty-three Dominican pesos (RD $ 291,528,487,153), or its equivalent in foreign currency”.

After only 12 days of the year 2021, the Chamber of Deputies approved another loan, which had already been known by the Senate, for an amount of almost 45 million euros, equivalent to about 50 million dollars, with the AFD for the “ increase in the transport capacity of Line 1 of the Santo Domingo Metro ”.

Precisely in January, the Senate also approved three loans for an amount greater than 445 million dollars that, in the following three months, were confirmed by the Chamber of Deputies.

The loans, signed with the AFD, the IDB and the JPMorgan Chase Bank, were for amounts of 236 million, 155 million and 54 million dollars, respectively. The detail is that only one of them was with something related to COVID-19.

The loan with the AFD was the only one related to mitigating the pandemic, having as motivation “the Program to Strengthen Public Policy and Fiscal Management to attend to the health and economic crisis caused by COVID-19.”

On the other hand, the one signed with the IDB, seeks the “financing and execution of the Program for Expansion of Networks and Reduction of Electrical Technical Losses in Distribution”. While that of the JPMorgan is destined to “financing of the Project of Pluvial and Sanitary Sanitation of the Cañada de Guajimía Phase II, Stage I”.

In total, the indebtedness approved by both legislative chambers to date, yield an approximate amount of USD 12 thousand 531 million 310 thousand 862.51.

Other loans
On the other hand, Congress still has three loans pending approval by a legislative chamber.

The most recent is a loan signed with the Andean Development Corporation (CAF), for an amount of 300 million dollars, and with which the “financing of the Program to support the emergency generated by the COVID pandemic is intended. -19 in the Dominican Republic ”.

The other two, agreed with the IDB, are 50 and 70 million dollars, which are intended to be used for the “financing of the Program for the Improvement of Vocational Education and Training” and the “Financing of the health and agricultural innovation project. ”, Respectively.

DATA

Specifically, of the 14 debts that Congress has handled, only three specifically mention that they are to mitigate the effects or face the COVID-19 pandemic, totaling an amount of $ 636,080,000.

Regarding the organizations with which the different loans have been signed, there are four taken with the IDB and AFD, one with IBRD, JPMorgan and CAF, while the placement of sovereign bonds by the Treasury.

If the remaining three loans pending approval in a legislative chamber are approved, the approximate amount of money loaned would be USD12 thousand 951 million 310 thousand 862.51 which, at an exchange rate of 57 pesos per dollar, would give an estimated total of RD $ 738 thousand 224 million 719 thousand 163.15.

A detail to highlight is that each loan has an individual contract and therefore different conditions, such as the exchange rate, interest, payment times, among other specifications.

The entry Loans in Congress exceed $ 12 billion was first posted on VisionRDN.