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Daily News - 03 December 1998

Senate postpones Monetary Code debate
The Senate suspended work yesterday and postponed debate on the bill to create a Monetary and Financial Code until next Tuesday, just as the Senate did the day before for the national budget. Late Tuesday a compromise accord was announced on the Code by Senate President Ramón Alburquerque and the President of the Association of Commercial Banks, José Manuel López Valdéz. Passage of the bill has been four years in the making. Debate was suspended yesterday so that the leadership of the Dominican Revolutionary Party (PRD) could meet with allied Senators of the Santo Domingo Accord (ASD) to discuss in detail the compromise reached on the Code, as well as the compromise accord worked out last week with the Fernández Government on the national budget. After emerging from that meeting, PRD President Dr. Enmanuel Esquea Guerrero told the news daily El Siglo that the PRD leadership endorsed both compromise pacts.

Honduras, Nicaragua have not signed trade deal with DR
Industry and Commerce Minister Luis Manuel Bonetti clarified yesterday that Honduras and Nicaragua did not sign the free trade agreement finalized last Sunday in Miami by the Central American countries and the Dominican Republic. Only the DR, Costa Rica, El Salvador and Guatemala actually signed the Protocol filling in the details of the framework treaty signed by the DR and Central American nations last spring, he revealed.
Honduras and Nicaragua have said that they may remain "outside" the trade pact until they recover from the disastrous impact of Hurricane Mitch on their countries.
He expressed confidence that the Dominican Congress would ratify the agreement quickly, allowing it to take effect January 1999. He said that under the terms of the Protocol, 19 products will be broadly exempted from tariff reform, including petroleum derivatives, tobacco, cigars and cigarettes made from blond leaf, sugar made from cane or beets, roasted and unroasted coffee, wheat flour, ethyl alcohol, alcoholic beverages, malts, rice, poultry, milk, onions, garlic, beans and cotton textiles. Tariffs will be gradually lowered until the year 2004 on bovine and porcine meats, processed tomatoes, hygienic paper, napkins, polyethylene and polypropylene bags, oral and intravenous sera, plastic films made of ethylene polymers, shrimps and lobsters. Tariff quotas within which will products be given favorable tariff treatment will apply to chicken breasts, oils, margarines and milk.

CDE divided into 7 operating units + corporate
The administrative board of the Dominican Electricity Corporation (CDE) announced yesterday the immediate reorganization of the company into seven distinct operating units in order to prepare it for the upcoming capitalization. Decree 428-98 creates the following units: (a) Southern Electricity Distribution; (b) Northern Electricity Distribution; (c) Eastern Electricity Distribution; (d) Hydroelectric Generation; (e) Itabo Electricity Generation (includes Itabo plants I and II, gas turbines Itabo I, II and III, and Santo Domingo plants V and VIII); (f) Haina Generation (Haina plants II, III and V, the Haina gas turbines, and plants Puerto Plata I and II); (g) Electricity Transmission System. Also created was a Corporate Unit, which includes centralized services such as overall administration, auditing and legal counsel.

ASD figures reject reelection idea
Prominent members of the Santo Domingo Accord (ASD), the longstanding alliance of the Dominican Revolutionary Party (PRD) with several smaller parties, yesterday rejected suggestions by Secretary of the Presidency Danilo Medina for reform of the Constitution. Speaking on the television program "Hola" on Monday, Medina had suggested that PRD might be persuaded to agree to a compromise on reform: allow presidential reelection in exchange for lowering the threshold which must be passed in order for a candidate to win the presidency in the first round of voting.
The PRD in the past has called for lowering the 50% threshold in the Constitution for winning the presidency in the first round of voting. PRD's fallen leader, Dr. José Francisco Peña Gómez, won the most votes in the first round of presidential elections in 1996, but just missed the 50% threshold. He lost in the second round after the Reformista Party (PRSC) threw its support behind the Dominican Liberation Party (PLD) candidate, Leonel Fernández. The PRD worries that a similar scenario could be played out again in future elections. Medina said that the PLD might be willing to support a lower threshold if in exchange it could gain PRD support for a Constitution amendment to allow reelection of a President.
After a political crisis sparked by fraud in the 1994 presidential elections, the Constitution was then amended to prohibit reelection.
ASD Senators Fernando Alvarez Bogaert, Darío Gómez and Vicente Sánchez Baret all rejected the idea. Gómez, spokesman for the PRD bloc in the Senate, declared that the constitutional prohibition on reelection is "not negotiable." "Under no circumstances will [PRD] leadership negotiate that, less so in exchange for lowering to 45 or 40 percent" the threshold for winning in the first round. "Stop dreaming," he advised Medina.
Sánchez Baret recalled that while alive Dr. Peña Gómez consistently opposed allowing presidential reelection, so PRD endorsing such an idea now would be repudiating what Peña Gómez stood for.
Alvarez Bogaert, who is also the President of the Democratic Unity Party (UD), said that Dominican society has too many important problems to solve before it can even think about constitutional reform.
Also asked about Medina's idea, PRD Secretary-General and presidential precandidate Hatuey Decamps echoed the point made by Senator Sánchez Baret about it violating the legacy of Dr. Peña Gómez. He characterized the reelection idea as "negative for a democratic country like the Dominican Republic." It is a non-negotiable point and no time should be wasted seeking a constitutional amendment to this end.

Administration already has constitutional amendments drafted
The Executive Secretary of the Commission on Reform and Modernization of the State, Dr. Onofre Rojas, revealed yesterday that the Fernández Government has already drafted the constitutional amendments it feels should be considered by a constituent assembly. The Administration has been working on this project since the day it took office in 1996. Some final material will be added by December 16th that takes into account the conclusions by the National Dialogue last March, after which it would need only the blessing of President Fernández in order to be formally submitted to Congress. Dr. Rojas said that the Administration has prepared amendments following the dictates of Articles 116, 117, 118 and 119 of the Constitution (the articles governing constitutional reform proposals), dealing with the topics of human rights and the powers of the three branches of central government (executive, legislative, judicial).

Sammy can't lobby for RD's PanAm bid
Home-run king and Most Valuable Player (MVP) Sammy Sosa told Hoy newspaper last night that, as much as he would like to do it, prior commitments in Puerto Rico and the U.S. preclude his participation in the Dominican delegation to lobby for Santo Domingo to host the 2003 Pan American Games. It was announced yesterday that Sosa had been invited to accompany the delegation, and the news sparked considerable excitement in Panama City, where the Pan American Sports Organization (ODEPA) is due this weekend to decide on the site for the 2003 PanAm Games. Sosa told Hoy that he wants to help his country in every way possible, but he cannot back out of the commitments he made weeks ago.

Straw poll: SD needs only 4 votes to win PanAm bid
The newspaper El Siglo has conducted an informal poll of ODEPA delegates due to vote this weekend on the site for the 2003 PanAm games. According to El Siglo, Santo Domingo already has 23 "solid" votes, enough to ensure that it makes it past the first round of voting and only four votes short of winning the bid in the first round. Its two rivals for the Games, Guadalajara, Mexico, and Medellin, Colombia, so far have 19 and 9 "solid" votes, respectively. SD's bid is openly supported by 19 nations, four of which (Canada, Puerto Rico, U.S., Venezuela) have two votes instead of one by virtue of having hosted the PanAm Games in the past. Guadalajara has the support of 16, three of which (Argentina, Cuba, Mexico) have two votes. Colombia has just seven open supporters, two of which (Brazil and Colombia) have double votes.

Capitalization's impact on Banco de Reservas
The Administrator of the Banco de Reservas (Banreservas), Roberto Saladín will meet today with President Leonel Fernández and members of the Commission for Public Enterprise Reform (CREP) to discuss what to do with the massive debt owed to Banreservas by the state firms due to be capitalized. Concerns have recently been expressed about whether the capitalization process will weaken Banreservas, the bank to which the state firms in question owe RD$2,173 billion. The Dominican Corporation of State Enterprises (CORDE) owes RD$852 million of this, the State Sugar Council (CEA) RD$761 million and CDE RD$560 million, according to Saladín. He asserted that it must a national priority to liquidate this debt. On Wednesday, CREP President Antonio Isa Conde assured media representatives that Banreservas would emerge stronger from the capitalization process, and explained that CREP has been working closely with Banreservas to come up with a solution to the debt problem.

Assets seized of alleged money launderers
A "highly reliable source" in the National Drug Control Directorate (DNCD) told the afternoon news daily El Nacional yesterday that it not only arrested seven associates of accused Mexican money launderer Carlos Cabal Periche, but also has arranged to freeze bank accounts and close five phantom businesses connected to them. Cabal Periche, wanted in Mexico for laundering some US$300 million, was arrested last month in Australia. Mexican authorities announced on Monday that his seven associates - two Dominicans, two Puerto Ricans and three Italians - were arrested in the DR this past weekend by Dominican authorities and Interpol agents. The phantom operations, all listed under the names of the two Italians, included a nonexistent hotel in Sosúa and a fictional ranch with 100 head of cattle. Dominican investigators are still looking into the business operations of the group to see if they can identify any other money laundering fronts. Mexican authorities and DNCD are to meet today to exchange documents and evidence that would help Dominican authorities trace any illicit operations run by the group. The DNCD source also said that a lawyer who allegedly helped the group set up the false enterprises has been arrested, and arrests have been ordered for several people accused of providing false Dominican passports to Cabal Peniche and his family.
As to where the seven alleged money launderers will be tried, the DR's Solicitor-Generalís Office points out that Mexico and the DR do not have a bilateral extradition treaty, so delivery of the seven to Mexican authorities for trial in that country is unlikely.

Credit and bank card fraud rising
Yesterday the District Attorney for the National District (DN), Francisco Domínguez Brito, added his voice to those warning of increasing credit and bank card fraud in the Dominican Republic. In recent weeks several newspapers have had feature articles on the growing problem, with general statements from regulators and commercial banks about how they are trying to combat fraud and providing advice to consumers on how to avoid it. Banks have estimated that card fraud in the Dominican republic already costs card issuers RD$200-300 million annually.
Domínguez Brito yesterday warned that card fraud is indeed on the rise, and that his office is giving priority to addressing cases of this type. Card fraud is not unique to the DR; it is a global problem. He argued that while most (but not all) of the perpetrators identified so far are Dominicans, most "have international roots" and he wants closer cooperation with U.S. authorities in order to combat the fraud more effectively. He warned card users that there are gangs devoted to searching through trash cans - especially those near stores - looking for credit card receipts with the card user's name and number on them. This information is then used in fraudulent purchases and bill payments.
Meanwhile the National Police announced yesterday the arrest of three people accused of swindles involving bank cards used at automatic teller machines (ATMs). The three had concocted a scheme whereby they would use a piece of adhesive tape to inhibit the proper functioning of an ATM, so that it would retain the next user's card. They would then approach the distressed user, offering to help. During the process of "helping," they would learn the user's secret code. The user leaves when his card still is not returned; the "helper" removes the card and tape, and uses the card and its code to withdraw large sums. The culprits were caught after an investigation by police's Fraud Unit.

False consulate dismantled in Montecristi
The Solicitor-General of Montecristi District, Dr. Elbis Muñoz Sosa, ordered the imprisonment of Nicolás Villalona Marichal, alias "Sasote," for allegedly swindling more than twenty people in Montecristi province in providing false visas. Muñoz Sosa says "Sasote" gained more than RD$500,000 charging RD$60-70,000 a piece promising to deliver visas to Germany, Spain, Switzerland and the U.S. The false "consul" would give his victims falsified visas using the name of Sports Minister Juan Marichal or Oakland Athletic scout Santiago Marichal.

Automated monitoring of large tax contributors?
The head of the Directorate-General of Internal Revenue (DGII), Juan Hernández, announced yesterday that his office is contemplating the use of so-called "smart cards" instead of human inspectors to monitor some large tax contributors. On October 28 DGII placed inspectors in large commercial establishments around the country to ensure that these companies' tax declarations are line with their true sales levels. DGII is now considering the use of special cards that would be attached to the cash registers of certain establishments and convey sales data directly to DGII, eliminating the need for the physical presence of DGII inspectors in each establishment. Hernández said that the measure would only be taken with those establishments who do not cooperate voluntarily with DGII in correcting their tax declarations. DGII asks those establishments not reporting sales in line with DGII's data on averages for their sector are asked to work with DGII to "rectify" their declarations. Where no agreement can be reached, DGII would force the installation and use of the "plastic auditors."

SESPRES: Government is addressing nutrient problem
Just one day after the local UN Children's Fund (UNICEF) representative released that organization's finding of serious micronutrient deficiencies in Dominican children, the Public Health Ministry (SESPRES) asserted that it is already addressing the problem. Dr. Matilde Vásquez, Director of Nutrition at SESPRES, pointed out to the news daily El Siglo that it has in the budget RD$17.7 million to supplement all pregnant women and children under the age of two with iron and folic acid in order to combat anemia. Anemia is a danger to pregnant women and can lead to low birth-weight in their children. Regarding iodine, one of the worst deficiencies identified by UNICEF, Dr. Vásquez said that SESPRES has worked with the local salt industry since 1995 to have this nutrient added to their product, and now all four salt producers offer iodized salt. [UNICEF has urged going a step further, and mandating by law that all salt sold in the DR contain a minimum iodine content.] As for vitamin A, SESPRES has negotiated with the sugar industry to add this nutrient to sugar, and has earmarked RD$10 million for this project. Vitamin A will not actually be added until the 1999 harvest, however, because the technicians responsible for the project need to receive training first in Guatemala. SESPRES is distributing vitamin A capsules to women and growing children, and has sufficient supplies of the capsules to last until the year 2000, thanks to UNICEF, the Pan American Health Organization (PAHO) and the Government of Canada. In other areas, Dr. Vásquez said that (1) SESPRES has nearly concluded negotiations with the flour industry to added iron, folic acid and vitamin B complex to the flour and derivative products they manufacture; (2) SESPRES is designing campaigns to educate the public on which vegetables are rich in iron and vitamin A and the need to provide children these nutrients.

70% of bottle water not meeting mineral content norms
SESPRES' Director for Environmental Health, Luis Emilio Feliz Roa, told a roundtable of health reporters that 70% of the bottled water presently sold in the DR does not meet existing norms set for such water by the National Directorate for Norms and Quality Systems (DIGENOR). According to Feliz Roa, around 25% of the overall Dominican population consume bottled water, and approximately 35% of Dominicans under one year old do. Yet most bottled water in the DR does not meet minimum standards set by DIGENOR for mineral content of such waters. Water can be an important source of micronutrients, especially for children. Feliz Roa said 150 of Dominican bottlers use an osmosis process which results in water low in necessary minerals. He said that his Directorate formed a technical committee aimed at toughening rules regarding bottled water, but it has come under pressure from vested interests.

Customs extends hours to deal with holiday load
Customs head Miguel Cocco Guerrero has ordered all Customs collection offices to stay open extra hours to ensure that the traditional extra influx of merchandise for the holidays can be processed quickly. In a circular issued to collectors in all seven airports (Las Américas, Cibao, Herrera, Gregorio Luperón-Puerto Plata, Maria Montez-Barahona, Punta Cana and La Romana) and eight ports (Boca Chica, Dajabón, Haina Oriental, Jimaní, Occidental, Puerto Plata, La Romana and Santo Domingo), Cocco ordered the offices to extend their operating hours to 9 pm.

Eagles trounce Licey; Lions rout Giants
The Cibao Eagles trounced the Licey Tigers 8-2 at Cibao Stadium in Santiago last night, increasing the Eagleís lead in the Winter Professional Baseball Tournament over second-place Licey to seven. Meanwhile at Quisqueya Stadium last night the Escogido Lions destroyed the Northeast Giants 9-3, in part on the strength of five perfect innings pitched by Julio Santana.
Tonight at 8 pm in Cibao Stadium the Eagles and Tigers will face off again, while the Lions and Giants are due to meet again tonight at 8 pm in Julian Javier Stadium in San Francisco de Macoris.

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