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When aid loans squeeze

THE recent food-price riots and social unrest in the Dominican Republic should be a warning to Congress and international lending institutions that efforts to stabilize financially troubled Caribbean and Latin American nations should take into account the region's unique cultural and historical background.

Tough austerity measures imposed by lending institutions such as the International Monetary Fund (IMF) may work in one nation - such as Mexico, as has occurred recently without the mass public unrest seen in the Dominican Republic - but not necessarily work in another nation. Each nation must be helped in terms of its own unique history.

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To its credit, the IMF - which imposed tough measures on the Dominican Republic as a condition for a loan from the fund - has been making efforts to be more accommodating to local conditions in drafting its loan requirements, according to outside analysts. But it seems clear that even greater attention to accommodation will be necessary in the future; otherwise, IMF or other loan requirements could add to the present social and economic difficulties.

The unrest - including recent protests and riots in Brazil, Bolivia, and Peru - also underscore the need for Congress to consider one key aspect of the Kissinger Commission report on Central America: the need for a massive infusion of emergency aid to the region in general. Had the Dominican Republic had access to some type of large-scale emergency aid from the United States, then the IMF might have been able to impose easier loan terms.

Just how serious is the recent unrest in the Dominican Republic? Is it indicative of the potential for future social unrest in other Caribbean nations? Experts differ in their assessments. So far as the Dominican Republic, some specialists believe that the ruling government of President Salvador Jorge Blanco will survive the current crisis - the first significant unrest in that nation since 1965, when US troops were sent in to quell a civil war. The Jorge government, for its part, is staffed with many technocrats and professionals. And the government is listening to its critics. Mr. Jorge, for example, met earlier this week with top union leaders.

Experts also point out that this is the season when weather conditions are at their hottest in the region, often accompanied by draught. Indeed, the 1965 strife occurred during this period of particularly adverse weather patterns.

That is not to minimize severe economic difficulties: high unemployment and much underemployment; and large trade imbalances, the result of falling sugar prices and the high cost of imported oil supplies.

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