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Daily News - 04 December 1998

Business calls for lower combustibles prices
The heads of several important business groups called yesterday for the Fernández Government to lower the price of key combustibles. Issuing the call were Celso Marranzini, president of The National Council of Private Enterprise (CONEP); Antonio Espín, former president of the Association of Industrial Firms of Herrera; Cesáreo Contreras, president of the Association of Ranchers and Farmers; and Ignacio Méndez, president of the Association of Industrial Firms of Herrera. They all recalled the government's 1996 promise to adjust prices of these products whenever world market conditions change, and noted that world oil prices are currently at their lowest since the early 1970s. The government owns the DR's sole refinery, operated under contract by Shell, and it sets the minimum sale prices for petroleum products in the Dominican market. Marranzini said that while he does not favor lowering the price of gasoline, he felt that certain derivatives that affect the family budget ­ gasoil, kerosene, and liquefied petroleum gas ­ should have their prices lowered. Both Méndez and Espín urged at least the lowering of prices for gasoil, which could help lower the costs of production for Dominican industry.
Industry and Commerce Minister Luis Manuel Bonetti declared yesterday that the Fernández Government would not be lowering the price of combustibles. He characterized the recent drop in world crude oil prices as "not significant," and in any case, a fall in crude prices does not automatically equal a fall in the prices of derivatives. The government procures crude at forward prices and must pay the contracted price, which is part of ensuring a secure supply. When there is a significant drop in costs for the government's procurement of crude, it will be reflected in the prices of petroleum products, he insisted, pointing to a March 1998 reduction. As far as gasoil goes, he declared, its current price is lower than it was during the government of Dr. Balaguer.

Peynado ready to run for President
Just days after a poll showed him to be the favorite choice of most Dominicans to be the Reformista (PRSC) candidate for President in the year 2000, former Vice President Jacinto Peynado announced that he would launch "within hours" the process to make him an official PRSC presidential precandidate. Besides completing the registration process within the party and organizing his campaign apparatus, Peynado said he would shortly convene a group of experts to help him update the platform he ran on during the 1996 presidential elections. He called for the PRSC candidate to be selected through a set of primary elections, as this was the most transparent and democratic manner to pick a standard-bearer. As for whether the PRSC should enter into a coalition agreement with the Dominican Liberation Party (PLD) as it did in 1996, Peynado did not rule out the idea as long as the PRSC, not the PLD, led the coalition this time. But he felt that the party should make it clear that it is not allied with PLD and that it has its own ideas, agenda and platform to offer the Dominican electorate.

Formula set to settle state firm debt with Banreservas
At the meeting held yesterday at the National Palace, President Leonel Fernández approved the settlement plan presented by officials of the Banco de Reservas (Banreservas) and the Commission for the Reform of Public Enterprise (CREP) in regards to the tremendous debt owed Banreservas by state firms headed for capitalization. The Dominican Electricity Corporation (CDE), State Sugar Council (CEA), Molinos Dominicanos and the Dominican Corporation of State Enterprises (CORDE) all owe significant sums to Banreservas. Molinos, for example, alone owes RD$355 million. Among other things, it was decided to transfer ownership of the state-owned insurance company, Compañía de Seguros San Rafael, to Banreservas. Banreservas will also gain title to some lands currently owned by CEA and will be given blocks of stock in several of the firms that emerge from the capitalization process. Some of the debt, however, will simply be transferred to the new firms for them to service. In the case of Molinos, for example, the new "Molinos de Ozama" will carry RD$125 million of the debt "Molinos Dominicanos" currently has with Banreservas.

Leftist groups seek to block capitalization
Just two weeks before CDE becomes the first state-owned enterprise to be put to bids in the Government's capitalization program, a coalition of five leftist organizations have announced that they will seek court actions to block the program's implementation. The Patriotic Union (UPA), Dominican Workers Party (PTD), Dominican Popular Movement (MPD), Communist Workers Party (PCT) and Alternative Action (AA) said at a press conference yesterday that next week they will seek court orders blocking the capitalization program, which they characterized as "illegal." They said that the Constitution prohibits the transfer of national patrimony to private hands. They also argued that (1) the state-owned companies up for capitalization are being purposefully undervalued in order to expedite their sale; (2) "in not a single country in the world has privatization solved a social problem"; (3) the recent examples of private company handling of telephones, energy generation and garbage collection in the DR should make Dominicans think twice about giving more public enterprises to the private sector.

Banking community says money laundering unlikely in DR
Interviewed yesterday at a meeting of Latin American bank supervisors currently being held in Santo Domingo, both the DR's Superintendent of Banks, Vicente Bengoa, and the President of the Association of Commercial Banks, José Manuel López Valdés, asserted that money laundering is difficult to do in the DR. The question has risen in public consciousness this week as associates of accused Mexican money launder Carlos Cabal Peniche were arrested in the DR. Bengoa said his office has ordered all commercial banks to examine their client lists to determine if any of them have links to Cabal Peniche. "I have always told the press that it is impossible to launder large quantities of dollars in the Dominican Republic," Bengoa declared. He explained that all banks in the DR have special units watching for money laundering whose reports can be accessed by his office. Banks are also required to report any account containing more than US$10,000 or its equivalent in Dominican pesos. For his part, López Valdés expressed doubt that the investigation linked to Cabal Peniche would affect any of his Association's members, since they all have been taking steps to prevent money laundering for several years. These include requiring any client seeking to deposit large sums to fill out forms attesting where the money comes from.

AIRD to propose changes in tariff bill
Groups affiliated with the Association of Industries of the Dominican Republic (AIRD) are drafting proposed changes to the tariff reform bill sent to Congress by the Fernández Government two weeks ago, says the newspaper Hoy. AIRD members are disturbed that the government's proposal leaves the tariff levels for many primary materials at high levels, some as high as 20%. While AIRD is not publicizing the content of its proposal yet, it reportedly is in line with a proposal recently put forth by CONEP. CONEP suggested capping tariffs for all primary materials at 20%, then instituting three cuts of 15%, 8% and 3%, with zero tariff rates set for agricultural and textile materials not covered by the "technical rectification" the DR made to the Uruguay Round global trade agreements. AIRD reportedly will submit its proposal to the Chamber of Deputies next Wednesday.

Free zones set new export record
The Director-General of the Corporation for Industrial Promotion (CFI), José Tomás Pérez, reported yesterday that the nation's free zones ("zonas francas") will set an export record this year, exporting around US$3.1 billion worth of goods and services despite the production interruption caused by Hurricane Georges. In the 1997 the zones exported US$2.6 billion. Pérez projected zone exports in 1999 of US$4 billion.

RD$1 billion to be invested to supply water to SD
At a press conference held yesterday at the National Palace, the Director of the Santo Domingo Aqueduct and Sewer Corporation (CAASD), engineer Euclides Sánchez, announced that the Fernández Government plans to invest RD$1 billion over the next year and a half to solve Santo Domingo's longstanding water supply problem. RD$300 million of this will be spent on damming the Higüero River to serve new aqueducts. Another major project foreseen under the program will be the construction of a series of wells in the vicinity of the Brujuela y Casuit River. Sánchez that the $1 billion price tag does not include the cost of proper maintenance of the new water sources and aqueducts, which is of critical importance. He said 58% of current CAASD production is lost due to leaks, water taps left open and related causes. Paying for such new investments and improving service is difficult, he said, because currently only 10% of CAASD's clients actually pay their bills.

SD is taking back its public spaces
The National District Government (ADN) of Mayor Juan de Dios ("Johnny") Ventura appears determined to "take back" Santo Domingo's public spaces and beautify them. Last week the ADN, working with the National Police (PN), started forcing commercial establishments that displayed their wares on city sidewalks or otherwise blocked public walkways to remove the obstructions. Earlier this week the ADN, again working with the PN, began relocating streetside vendors' shacks from places where they blocked walkways or created traffic jams on major throughways, and completely from Maximo Gómez Avenue, where the Metropolitan Transit Authority (AMET) is trying to create its newest bus corridor.
Wednesday the mayor's office unveiled a proposal that would severely restrict the use of billboards, posters, banners and other outdoor propaganda. A longstanding complaint of Santo Domingo residents is that the city is littered (literally and figuratively) with indiscriminate and imprudent use of such propaganda, often blocking from sight traffic lights and street signs. Affected parties are now studying the proposal, which is due to be decided at a municipal meeting next Wednesday after public discussion.
Yesterday came the newest step by the Municipality: an operation designed to remove "wrecks" from public roads and walkways. Initially tow trucks hired by the city focused on removing abandoned vehicles and vehicle wastes from market areas, public plazas and areas with streetside booths, but over the coming week the ADN plans to cover the entire territory of Santo Domingo. Dozens of vehicles were hauled the first day, plus a number of heavy partial remains of vehicles. Items are hauled to the Duquesa waste dump near Haina. ADN Transit Director Luis José Chávez urged owners of vehicles in public streets and sidewalks that may appear abandoned to remove the vehicles themselves, or else they will have to go to Duquesa to recover their property.

SCJ will sanction judges not submitting economic declarations
At a swearing-in ceremony yesterday in San Pedro de Macorís, Supreme Court (SCJ) President Jorge Subero Isa warned judges throughout the country that they must submit their sworn declaration of possessions and economic interests. The declarations are intended to fight corruption by making transparent when any given judge might have an economic conflict-of-interest in a case. The declarations are sent to the National Treasury, which in turn sends them to the nation's Attorney-General. The Department of Corruption Prevention says that currently only 68% of the country's judges have deposited their declarations. Subero Isa said that he has instructed the SCJ's Department of Accounting and Treasury to withhold December paychecks of magistrates who have not submitted their declarations until they comply. He further warned that those not submitting the declaration run the risk of being dismissed.

SESPRES warns of false permits
The Ministry of Public Health (SESPRES) issued a warning yesterday against a group of swindlers, passing themselves off as SESPRES officials, extorting money from merchants, producers and others in exchange for falsified sanitary permits and certificates. Many establishments, including colmados, supermarkets, restaurants, bars, food processors and others, are required to get special permits or certificates from SESPRES in order to operate. SESPRES warned yesterday that a yet-unidentified group has been making rounds of establishments in Santo Domingo, the Cibao and northeastern provinces claiming to be from SESPRES' Environmental Health Directorate-General. These persons are demanding large sums to issue the establishments new certificates and permits, all of which are false documents. SESPRES warned that businesses should not pay for permits and licenses except at their local SESPRES office. If someone tries to pull this scheme on an establishment, they should notify the police immediately.

A tiff over sex education in schools
On Wednesday. the Executive Director of the Dominican Association for the Well-being of the Family (PROFAMILIA), Magaly Caram, raised a lot of eyebrows by calling on the Fernández Government to return full-fledged sex education in the nation's schools. Caram cited a number of alarming statistics about teenage pregnancy in the DR (23% of girls age 15-19 were pregnant or mothers in the 1991-96 period, some 80,000 abortions are committed annually, most of them teens) to support her case that the lack of a formal sex education program in the DR is harming Dominican society. PROFAMILIA helped run a sex education program in DR schools for nine years (1983-92), but the program was canceled by the then-Education Minister Jacqueline Malagón, allegedly at the behest of Cardinal Nicolás de Jesús López Rodríguez. Asked Thursday about PROFAMILIA's call, current Education Minister Ligia Amada Melo angrily rejected it. She asserted that schools do teach sex education, albeit not in the fashion Caram would like. She accused Caram of really seeking to distribute condoms in public schools, which the Education Ministry could never agree to.

Police plan massive presence to keep holidays safe
National Police (PN) spokesman Simón Diaz announced yesterday that the PN's chief, Major General José Aníbal Sanz Jiminián, has ordered a nationwide mobilization of 25,000 police officers starting next Monday with the aim of keeping the holidays safe for citizens. The operation will last until Three Kings Day (Epiphany), January 6th. Diaz said that normal citizens have nothing to fear from the deployment, but delinquents should think twice before attempting anything because "we're going to be drastic with them."

Prisoner awaiting extradition to US freed
The DR's Attorney-General, Mariano Germán Mejía, yesterday ordered the release of a Dominican man held while waiting a decision on his possible extradition to the United States. 33-year old Victor López Paulino had been detained by the National Drug Control Directorate (DNCD) and the U.S. had sought his extradition to stand trial for allegedly killing four people in New York City and international trafficking of cocaine. He was also wanted for providing false declarations to the U.S. Immigration and Naturalization Service. López Paulino's lawyer had demanded his client's release because the 60-day holding period under current law had passed without a decision by President Fernández whether or not to extradite the man. The U.S. Embassy expressed dismay at the action, and asked the Public Ministry to explain how such a thing could occur. Embassy spokesman Michael Stanton called the release "extremely worrisome."

Queen Air inaugurates daily flight to NYC
Queen Air began its daily flights to New York's JFK airport this week. Flights leave Santo Domingo's Las Américas International Airport at 8:00 am. Return flights to Santo Domingo depart JFK at 12:30 pm. Queen is utilizing a 170-passenger Airbus A-320 for the flights.

Licey tops Eagles
The Licey Tigers reminded everyone last night that the Cibao Eagles are not unbeatable, defeating them 3-2 in Cibao Stadium in Santiago.
Today at 8:00 pm the Tigers play the Lions at Quisqueya Stadium in Santo Domingo and the Giants play the Eagles at Cibao Stadium.

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