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Daily News - 04 February 1999

PRSC says expansion of JCE not enough
Acting on precise instructions from the party’s leader, ex-President Dr. Joaquín Balaguer, the Social Christian Reform Party (PRSC), members of the PRSC Executive Committee declared that a simple expansion of the Central Election Board (JCE) membership will not solve the political crisis regarding the Board. A PRSC delegation traveled yesterday to Miami to consult on several issues with Dr. Balaguer, who is convalescing in the home of friend and long-time supporter, businessman Guaroa Liranzo. Upon their return last night by private plane at Herrera Airport, PRSC Political Secretary Federico Antún Batlle said that Dr. Balaguer insisted on a firm, unwavering Reformista stance regarding the JCE: the number of members (the present 5, 7 as some suggest, or 9 as the Dominican Liberation Party has called for) does not really matter; what counts is that those sitting on the Board be impartial. The PRSC has long maintained, in statements and its court challenges of the present JCE, that the members appointed last August by the Dominican Revolutionary Party (PRD)-dominated Senate are PRD activists, and thus incapable of being impartial.

Senate moves on Financial/Monetary Code
Yesterday the Senate wrapped up much of its work on the draft Financial and Monetary Code, leaving only 33 articles to be debated, most of those related to savings and loans institutions. Senate President Ramón Alburquerque (PRD-Monte Plata) told reporters that the Finance Committee is meeting this morning with representatives of the Central Bank and the savings and loan industry to try to hammer out a compromise on the 16 relevant articles. The savings and loans want to be put on competitive par with commercial banks, able to offer a broader range of financial services.
The amendments to the Executive Branch’s draft made by the Senate are creating some concern in financial and business circles. For example, the Senate changed the term of appointment for the Central Bank Governor and Superintendent of Banks from four to one year; many bankers and businessmen have worried aloud that this would subject these positions to greater political pressure and reduced policy consistency, in the process hurting market confidence. Yesterday the Senate amended Article 206 to allow financial groups to obtain financing for up to 100% of their so-called "paid-in capital" (called "own funds" in Europe) and reserves. Some experts question the financial prudence of such a rule.

President sends Financial Services Protocol to Congress
President Leonel Fernández yesterday sent to Congress for ratification the Financial Services Protocol, underlining his commitment to trade liberalization. The Protocol is a supplement to the 1994 Uruguay Round trade liberalization agreement package overseen by the Geneva-based World Trade Organization (WTO). The Protocol itself was first agreed in 1995 after arduous negotiations, and then amended in 1997 at the insistence of the U.S. to include more countries and better market opening commitments. The actual Dominican commitments under the Protocol are rather limited in scope. For example, although the DR will allow foreign companies to enter any portion of the Dominican insurance sector, the DR is one of only eight countries (out of 102) that will not allow insurance services to be offered across borders (i.e., a Miami-based or San Juan-based firm to insure people or businesses in the DR), and it is one of only five nations that will not guarantee the right of foreign firms to have majority control of their Dominican insurance subsidiaries. The DR likewise does not guarantee the right of 100% ownership of subsidiaries in the banking and securities sectors, although a few banks operating in the DR (Bank of Nova Scotia, Citibank) are 100% owned by foreign banks. It will guarantee "right of establishment" for banks – i.e., no barriers in setting up a Dominican operation as long as they meet the same requirements as local firms – but not for securities firms.

CONEP rejects re-negotiation of Miami Protocol
The President of the National Council of Private Enterprises (CONEP), Celso Marranzini, revealed yesterday that his organization has sent a letter to Foreign Minister Eduardo Latorre urging the Chancellery not to re-open negotiations on the Miami Protocol to the free trade agreement with Central American nations. Re-opening the Protocol to accommodate the demands of Honduras and Nicaragua would be dangerous, argues CONEP, as it would allow Central American nations to impose new market restrictions on Dominican products. CONEP is arguably the most influential of Dominican business lobbies. The Miami Protocol features restrictions on market access for a number of agricultural and fishery goods, including a "negative list" of products excluded from the trade liberalization measures of the Treaty, such as beef, beer, chicken, cigarettes, milk and shrimp. Honduras and Nicaragua have yet to sign the Miami Protocol, at first blaming the delay on damage to their economies by Hurricane Mitch and later saying that they wanted better market access terms from the Dominican Republic for their products. Last week the principal agriculture lobby, the Dominican Agro-business Board (JAD), wrote to Latorre expressing its opposition to any re-negotiation of the Protocol.

CONEP supports tax amnesty idea
CONEP President Celso Marranzini, yesterday added his voice to those calling for a national tax amnesty. Recently famed businessman José Luis Corripio ("Pepin") called for a limited tax amnesty as a way for the government to get the private sector to clean and correct their accounting books and begin paying what they really owe in taxes. Corripio also called for simplification of the DR’s tax bureaucracy and paperwork, with all forms made easy-to-use and all rules clear, precise and easy to comprehend, apply, enforce and inspect. Both ideas were promptly embraced by two major business groups, the National Union of Businessmen (UNE) and the Association of Industrial Firms of Herrera (AEIH). The head of the Internal Revenue Directorate-General (DGII), Juan Hernández, has said that the Fernández government would support a "conditional" amnesty as long as it was established by a law passed by Congress. He has pointed out that the Administration’s first economic reform package submitted to Congress in 1997 included a type of amnesty where taxpayers would have paid a symbolic fraction of tax owed when they came clean in their reporting to DGII.

Five new free zones approved
The National Council of Free Trade Zones has approved the creation of five new FTZs (known in the DR as "zonas francas"), representing an initial investment of RD$55 million and expected to generate more than US$4 million in revenues. The approval was announced by Industry and Commerce Minister Luis Manuel Bonetti after a meeting of the Council in Santiago. Two of the new parks will be created in San Pedro de Macorís, and one a piece for Los Alcarrizos, La Romana and Salcedo. In 1998 alone, seven new FTZs were authorized by the Council and 58 new firms approved to operate within the parks.

Aristy: my resignation within hours
Senator Amable Aristy Castro (PRSC-Altagracia) told reporters last night that he will announce his resignation from the Senate "within hours." Last week Aristy Castro was "elected" Secretary-General (SG) of the Dominican Municipal League (LMD) by one of two parallel national municipal assemblies (a second, run by PRD, "re-elected" peredista Julio Maríñez Rosario), and then installed (under heavy security guard) in office by Interior Secretary Ramón Andrés Blanco Fernández. Upon his election Aristy Castro promised to resign his Senate seat, as required under Article 18 of the Constitution (which specifies that national legislators can not simultaneously serve in another public post). However, a week later, with no resignation in sight, Senate and PRD spokesmen protested and several lawyers opined that until he did leave the Senate, his LMD decisions may be considered without legal effect. The source of Aristy Castro’s delay has not been explained: some acquaintances suggest that he did not want to resign until it was clear that a PRSC member would be appointed to his vacated Senate seat, and the party had decided who that would be; others suggest he was hesitant to renounce his Senate post until the legal challenge to his LMD leadership was resolved. Yesterday Aristy Castro accompanied PRSC leaders on their consultation with party leader Dr. Balaguer in Miami. Officially Aristy Castro went to report to Dr. Balaguer on the LMD battle, but it is widely believed he also sought Balaguer’s counsel on the resignation issue. Speaking upon his return at Herrera Airport, Aristy Castro declared that he would resign "within hours," that the list of possible replacements had been narrowed, and the PRD-controlled Senate "is obligated" to accept whomever PRSC designates to fill his seat.

Will there be a PRD Convention?
Yesterday three of six PRD luminaries seeking the party nomination for president in the year 2000 elections rejected the idea of selecting the party standard-bearer "by consensus" among PRD upper ranks. Senator Milagros Ortíz Bosch (National District), former Santo Domingo Mayor Rafael ("Fello") Suberví Bonilla and ex-Agriculture Minister Hipólito Mejía all insisted that they believe the party’s nomination should be decided by PRD rank-and-file at a national convention, as originally planned. A fourth pre-candidate, PRD Secretary-General Hatuey Decamps, had already expressed his reservations about the idea. The convention was originally scheduled for this month, but has been postponed indefinitely. This week Senator Milton Ray Guevara (PRD-Samaná) suggested that a candidate be decided by consensus among party leaders so that the party can present a united front. Several PRD leaders have expressed interest in the idea, while stressing that it is not an official proposal under consideration by the Party Presidium.

Firearms law to be proposed
Yesterday Interior and Police Minister Blanco Fernández confirmed that the Executive Branch is drafting a bill to place more controls over the licensing and private ownership and use of firearms. He said that the legislative proposal is in the final drafting stages and should be sent to Congress shortly. Among other things, the measure is intended to make it more difficult to procure a firearm and to prohibit the public exhibition of firearms by civilians. Earlier this week the District Attorney for the National District called for such legislation, saying the present law has too many ambiguities and loopholes and allows far too many Dominicans to openly tote firearms during their daily activities.

1999 PP Carnival to feature international salsa stars
The Tourism Ministry (SECTUR) announced yesterday that this year’s Carnival parade and celebration in Puerto Plata will feature four stars of salsa: Celia Cruz, Oscar de León, Johnny Pacheco and José Alberto ("El Canario"). The televised events are being organized and sponsored by SECTUR, Cervecería Nacional Dominicana (brewers of Presidente beer), American Airlines, the Association of Playa Dorada Hotels and the Tour Operators Association.

DR defeats Mexico in Caribbean Series
The DR yesterday racked up its second victory in the Caribbean Series, beating Mexico 6-3 at Hiram Bithorn Stadium in San Juan, Puerto Rico. The DR is represented in the Caribbean Series by the Licey Tigers, winners of the Final Series of the DR’s Winter Professional Baseball Tournament. Mexico is represented by the Mexicali Eagles. The Tigers scored all their points in the first three innings while pitcher Darío Pérez held them runless. Tonight’s game pits the DR against the tough Puerto Rican team at 8 pm. PR is represented in the Series by the Mayagüez Indians, who are also unbeaten in this Series. The game will be televised in the DR on Channel 7 (Rahintel). The rest of the Series schedule is as follows:
  • Thursday, Feb. 4th: Venezuela v. Mexico, 4:00 pm; PR v. DR, 8:00 pm
  • Friday, Feb. 5th: Venezuela v. DR, 4:00 pm; PR v. Mexico, 8:00 pm
  • Saturday, Feb. 6th: Mexico v. DR, 2:00 pm; Venezuela v. PR, 6:00 pm
  • Sunday, Feb. 7th: Mexico v. Venezuela, 2:00 pm; DR v. PR, 6:00 pm

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