Dominican Republic: Uncertain times ahead for Haiti’s neighbour
DR bankers look towards earnings from reconstruction; Others worry about negative domestic effects
Since an earthquake hit Haiti in January analysts covering the neighbouring Dominican Republic have lurched between positive and negative predictions for the year ahead.
On one side of the debate are the commercial banks, which are lining up credit lines that will meet the new and growing needs of local companies.
"Our economy will be helped by the fact that everything the Haitians need to rebuild and modernize will be supplied by the DR," says Edward Baldera, manager, financial institutions division, at Banco Popular Dominicano. "Because of this we are already starting to see local commerce increase and sales grow significantly. Local companies are growing and need more credit. DR importers are also demanding more financing as they try to satisfy local and Haitian needs. Right now interest rates are at record lows and so this is a good time for us to offer our clients access to credit at very attractive rates."
Banco Popular Dominicano has started talks with multilateral agencies as it searches for new credit lines that will enable it to meet the growing local demand. So far feedback from the International Institute of Finance and the Inter-American Development Bank has suggested that credit lines of $20 million to $25 million could be made available by June.