Dominican Republic may face fiscal adjustments, economist warns

Economist Jaime Aristy Escuder has warned that the Dominican Republic must prepare for fiscal adjustments due to the economic situation in the United States. He noted that as long as U.S. interest rates remain high, the Dominican Republic could face increased costs for financing its debt.

Aristy Escuder indicated that the country's risk premium, currently at a historically low level, could rise from 167 basis points to between 180 and 200 points. This shift could push rates to approximately 7%, resulting in higher interest payments for the Dominican state. To manage this, he suggested the nation may need to reduce spending, increase revenue, or implement a combination of both measures to ensure public finance sustainability.