Press Release No. 08/312

Press Release: Statement by IMF Managing Director Dominique Strauss-Kahn at the Conclusion of his Visit to the Dominican Republic

December 8, 2008

Mr. Dominique Strauss-Kahn, Managing Director of the International Monetary Fund (IMF), issued the following statement today in Santo Domingo at the conclusion of his visit to the Dominican Republic:

"It has been a pleasure to visit the Dominican Republic as a part of my first official tour to the Caribbean and Central America. My trip to the region takes place in the context of a very serious global financial crisis, which requires firm and comprehensive action by all our countries as well as close policy coordination among them.

"During my stay in Santo Domingo, I had the privilege to meet His Excellency President Leonel Fernández Reyna, Governor of the Central Bank of the Dominican Republic, Mr. Hector Héctor Valdez Albizu, Secretary of Planning, Economy and Development, Mr. Juán Temístocles Montás, Secretary of Finance, Mr. Vicente Bengoa, and Superintendent of Banks, Mr. Rafael Camilo Abréu.

"Our discussions focused on the dual challenge facing the Dominican Republic in this difficult time: the need to return to a financeable fiscal position in the face of tight world credit markets, while ensuring that macropolicies do not exacerbate an emerging slowdown in economic activity. There was broad agreement on the need to rebalance macroeconomic policies by reducing the fiscal deficit, as proposed by the authorities, to allow some easing of monetary policy and lower interest rates to help spur private sector activity. Over the medium term, improving economic welfare will hinge on accelerated employment creation and income growth that will be enhanced by a further gradual but steady reduction in the public debt ratios.

"In these difficult times, close oversight of the financial sector is most important. On this front, bank indicators are favorable, suggesting a well-capitalized, liquid, and profitable banking system that should be well-positioned to withstand current adverse external conditions. A joint IMF and World Bank mission is scheduled for early 2009 to conduct an update of the financial sector assessment program, which should further aid the superintendency of banks to strengthen its efforts in ensuring the financial sector becomes a major strength of the economy.

"The policy objectives for 2009 should contribute significantly to allow the Dominican economy to weather well the current global economic crisis."