Congress authorized new debt for US$6.0 billion
SANTO DOMINGO. In the Public Budget 2014, Congress authorized the administration to take on loans for specific projects for the amounts of US$US$3.4 billion and €7.0 million. What the agreements for this financing have in common is that they were done through international banks (which is understood to mean commercial banks), for seven (7) years and “at an interest rate and commissions compatible with the market.”
This amount does not include the emission of global bonds, which for US$1.5 billion was also authorized by Congress for 2014.
Between April and May, the administration completed this emission at a 30 year period, and at interest rates between 7.45% and 7.5%.
Neither does this include the authorization for the Minister of Hacienda to issue securities in the internal market and the taking on of debt with the local banks, for an amount of RD$33.6 billion.
This information reveals that the administration is authorized by the legislators to take on new debts for nearly US$6.0 billion in 2014.
Once this new financing is agreed upon, it is stipulated that the Executive Branch will send, after the signing, “the contracts that come from the cited operations of public credit in order to be approved by the National Congress.” So, last March, the proposal to authorize the emission of global bonds for US$1.5 billion went through Congress (already issued) and that of the Ministry of Hacienda securities.
One of the most important projects for the administration is that of the construction of two coal-fired generation plants in Punta Catalina, in Bani. Each will have a capacity of 337.39 megawatts. In the Budget, the government is authorized to contract a loan for US$1.5 billion.
Last 10 July, Jeremias Santana, the CDEEE manager for the construction work at the generation site, reported that the efforts for getting the loan are “well under way”, and that the National Economic and Social Development Bank (BNDES) of Brazil will finance part of the project.
Nonetheless, among the loans approved by the Congress there is included one for US$33 million to be used in the financing for the program of Urban Development and Habitat Phase II, that will be carried out by the National Housing Institute (INVI). This project and this financing are not included in the 2014 Budget.
The other financing
During 2014, Congress has approved loan agreements for US$44.4 million dollars, and €65 million Euros. These agreements were for projects that were undertaken in 2013 and that were approved by the legislators in 2014. Among them can be noted an addendum to the financing agreed upon with the BNDES for the construction of the dam at Monte Grande for US$249.6 million.
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