Critics Call for End to State Control

ECONOMISTS and political analysts widely agree that the May 16 general elections heralded profound economic and political change in this Caribbean democracy. During the last decade the economy of the Dominican Republic has shifted from its traditional sugar-coffee-cocoa-tobacco base toward manufacturing and services. Tourism is now the biggest foreign-exchange earner.

At the same time, the strategy of state-led development is exhausted. Government coffers are empty; state-owned companies are spewing red ink; the economy is stagnant; inflation is at 60 percent; and foreign-debt payments are $900 million in arrears.

``We are seeing the end of the cycle of state capitalism,'' says Andres Dauhajre, a Dominican economist. ``The role that the state has played must be substituted by private initiative.''

The political system is due for a shake-up, too.

President Joaquin Balaguer, the apparent winner in the May elections, and rival Juan Bosch have been political forces since the 1960s. Political analysts generally agree that either restructuring or disintegration of their respective Social Christian Reformist and Dominican Liberation parties will follow their retirement.

But change will not be limited to changing faces. Political analyst Julio Brea Franco says major political parties will be restructured - some may even disappear while others are created - because they have not kept pace with society's shift from a rural to an urban base.

``By the next elections in 1994 we will have seen major changes,'' predicts Mr. Brea Franco. ``Balaguer and Bosch will be gone. This is the beginning of the end of an epoch.''