Caribbean & Central America - 26 August 2003

The government has agreed a US$618m aid package with the IMF after two months of negotiations. The standby credit agreement should pave the way for further loans from the World Bank and the IDB. The government is keen to secure US$1bn of total aid from the multilaterals. 

Complete details of the agreement, which should be approved by the board by the end of the month, have not been released, but the government has agreed to cap government wages and cut the fiscal deficit. It also agreed to impose a two percent import tariff and double the departure tax to US$20. 

Business organisations have been highly critical of the government's decision to place a five percent tariff on Dominican exports, and are appealing to the supreme court of justice against the presidential decree that imposed it. They argue that only the national assembly is able to approve the imposition of fresh taxes. 

Meanwhile, police have clashed with rioters on numerous occasions over the last few weeks. The rioters are protesting the IMF deal, rising prices and electrical blackouts.