Local banks hold Sun Land debt

The Standard & Poor's agency has improved the credit rating of the Dominican Republic to B+B, and took the DR off of the non-trustworthy list of nations where it was placed last 8 February with negative implications due to the uncertainty surrounding payments that had to be made between March and July to Sunland for a total of US$130 million.

The risk assessment firm reported that the promissory payment notes for US$130 million should have been paid in September of last year, but were cleaned up this year, when they were bought by foreign investors and then acquired by a local, Dominican bank last February.
The firm points out that the forecast for the Dominican Republic is negative in the near future due to an increase in the fiscal deficit in the current accounts which has reduced the external liquidity of the nation.

The report also points out that the forecast reflects the increased risk due to the lack of liquidity and the stress due to macro-economic problems that in the future could damage the credit level of the Dominican Republic.

Standard & Poor's says tat a successful implementation of the economic policies intended to reduce the external and fiscal vulnerabilities of the country, that do not cause a fall in the Dominican economy, could have a good result, and therefore they have changed their estimate from negative to ‘stable'.
The risk assessment firm pointed out that recent fiscal plans announced by the authorities and that include controls on public spending, could lower the fiscal deficit to 4% of the GDP this year and perhaps to a 3.4% for next year, compared to the 6% that was forecast without any fiscal corrections.