The Hamilton Beattie & Staff-Hoy March poll shows PLD candidate Leonel Fernandez winning in a first round, albeit with a much lesser lead than predicted by Penn Schoen and Gallup polls carried out in January and February, respectively. The Hamilton poll shows Fernandez winning with 52%, followed by Hipolito Mejia (PRD) with 25% and Eduardo Estrella (PRSC) with 17%. The Hamilton poll comes after Fernandez and Mejia choosing their Vice-Presidential candidates. The complete tickets are now: Hipolito Mejia and Rafael Subervi for the PRD; Leonel Fernandez and Rafael Alburquerque for the PLD; Eduardo Estrella and Jose Hazim for the PRSC. The poll took place 20-23 March and 1,200 eligible voters were interviewed nationwide. In February, a Gallup poll had shown Fernandez leading with 63.1%, versus 14.6% for Mejia and 14.9% for Estrella. In January, the Penn Shoen poll showed Fernandez ahead with 65.7%, followed by Estrella with 16% and 13% Mejia. This latest survey revealed that, should none of the candidates net the minimum 50%+1 majority to win a first round, Fernandez would also win in a second round to become the next President. Hoy newspaper says that in the case of a showdown between Mejia and Fernandez, the vote would result in 59% for Fernandez and 27% for Mejia. In case the final two candidates were Estrella and Fernandez, the vote would yield 54% for Fernandez and 32% for Estrella. In both scenarios, Hamilton says 14% of the voters are undecided. The survey also polled voters on party preferences, indicating that 60% would never vote for the PRD, 30% would never vote for the PLD and 23% would never vote for the PRSC. The polled showed that 30% of Dominicans would never vote for Fernandez, 62% would never vote for Mejia and 21% would never vote for Estrella. Other findings disclose that 71% of those who have said they will vote for the Fernandez-Alburquerque ticket are firm in their decision, versus the 29% who are still considering it. Regarding the Mejia-Subervi ticket, 68% are unwavering in their choice, while 32% are still pondering whether to vote or not.
The latest steps taken by the Central Bank to further reduce the money in circulation have created tension between the bank and the IMF mission in charge of the standby agreement. The IMF people outrightly objected to the measures, saying they “rejected the validity of the impact” of the measures to shrink the money supply. This information was contained in a letter sent by Jose Lois Malkum to the sub-director general of the IMF, Agustin Carstens. In the letter, Malkum complains that the IMF team rejected the Central Bank measure that established an investment coefficient of 5% of the funds subject to the legal reserve as of 24 March, and the obligatory use of these funds in certificates from the Central Bank. Lois Malkum said the technicians rejected this policy because it would not have any effect. Apparently, according to sources close to the IMF negotiations, this letter by Malkum was in response to one sent by the IMF mission team that not only rejected the proposal but questioned the quality of it, too.
Elena Viyella de Paliza, the head of the nation’s top business association CONEP, told reporters from Hoy that the upcoming tax reform must simplify the tax structure. She said the present system makes collecting the taxes very difficult and that a simplification of the structure would insure more transparency in collection and the universal application of the legislation. Viyella also urged incentives for exports and investment and the creation of jobs. The fiery CONEP mouthpiece said that the state must become more modern and efficient, meaning an improvement in tax collection, supervision and application of tax laws. Finally, she warned that “if we create a tax reform that negatively affects the development of the country, we will be doing a tremendous harm to the nation.”
The government is proposing a tax reform that will increase the VAT (or ITBIS) to 16% and the tax rate to 20%. This information was offered by Eduardo Tejera, Federic Emamm-Zade and Julio Ortega at the Economic Meeting at Hoy. The three form part of the economic advisory team of PLD candidate Leonel Fernandez. Their central theme was that the IMF should not insist on tax reform during a period of political transition. Emam-Zade was particularly emphatic as he insisted that the government lacked transparency and that this was just a new set of taxes they don’t want anybody to know about this because of the political cost.
Frank Raineri, one of the more illustrious figures in the Dominican Republic’s hotel industry, called on President Mejia to rescind an agreement that advocates denying the smaller private generators access to duty-free fuels. These so-called “non-regulated” power producers, about 53 in number, are allowed by law to import fuel for their generating plants duty free, but a top-secret agreement between the CDEEE and the large generation units like Haina, Itabo and AES, appears to have infringed on this privilege. Rainieri told reporter Soila Paniagua from Hoy that the President was apparently misinformed about the deal as the clause that denies the access to duty-free fuel has not yet been activated. He said that to not disregard this agreement would generate huge deficits in the tourism sector, because a large number of the hotels are generating their own electricity and at current retail prices they would lose competitiveness and be tossed out of the market. The purchase of diesel fuel at current retail prices would easily lose the hotels money and cost thousands of jobs. Said Raineri, “The President must issue this decree (to terminate the clauses that restrict access to duty-free fuel) in order to bring some tranquility to many sectors of the economy.” The former president of ASONAHORES said that disregard for laws and agreements is one of the things that creates uneasiness among investors. Rainiers specifically mentioned the General Law on Electricity, and pointed out that in areas such as Punta Cana there are no power lines from outside, forcing them to rely on independent power sources.
Economist Julio Ortega warned that the electrical system is functioning only because it is obtaining fuel through international financial organizations, and that after the elections it is possible that the system will finally collapse. Ortega pointed out that the InterAmerican Development Bank (IDB) was assisting financing fuel purchases for three months. As soon as the election campaign is over, however, Ortega feels the system will begin to fail because the distributors do not have the collection capacity or the short-term plans necessary to solve the problem. Speaking at the Economic Meeting at Hoy, Ortega was joined by Federic Emam-Zade, Eduardo Rodriguez and Eduardo Tejera. Ortega is also a chemical engineer who specializes in petroleum issues and said that the electrical system is unsustainable, pointing out that after the CDEEE took over the EDEs, the collection rate fell. According to the speaker, the latest steps taken by the CDEEE were politically motivated.
The continual price increases combined with difficulties at the gas stations reduced gasoline consumption by 400,000 gallons last month and a sharp decrease in propane use. Propane use fell by 4 million gallons, due in large part to the scarcity in the marketplace. In February, the Dominican Refinery reported sharp decreases in gasoline sales, but large increases in kerosene and diesel. Combining the rise in diesel and other less expensive fuels, the refinery saw a 6% increase in sales overall.
The vice-president of the Dominican Association of Exporters (ADOEXPO), Horacio Alvarez, warned of the danger of a Free Trade Agreement that does not take into consideration the repatriation of earnings. He cited the experience of Chile, which had signed an agreement with the United States that did not include any regulations for the repatriation of earnings. At that time, Chile had many foreign companies investing much lesser amounts of money and whose earnings were shipped back home. While Alvarez recognized that this idea of regulating the repatriation of funds will surely be resisted by those who are “more Catholic than the Pope” and who will say that such a move will scare investors away, the reality is that if a company invests US$10 million and sends back US$15 million, the country is losing a lot. Alvarez urged the legislature to approve a law that would emulate the Chilean experience. In Chile, a company is now allowed to repatriate 25% of its investment after five years. Alvarez said that the people he talked to in Chile last year were emphatic in warning of the dangers of no control over repatriation of earnings.
Cacao made the papers over the weekend as Hoy published an Op-Ed piece by Jose Antonio Martinez Rojas, the president of the International Cacao Organization (ICCO) on Saturday and a major article in the economic section on Sunday. Martinez Rojas reported on his recent trip to the Ivory Coast, the new seat of the ICCO. The three-day meeting took a long, hard look at cacao futures. One of the suggestions was to create a parallel commodity marketplace for cacao, because the world price for the chocolate bean is fixed, not by the producers, however, but by the purchasers in the developed countries. Readers will remember that cacao is one of the Dominican Republic’s four main exports, along with sugar, coffee and tobacco. The suggestion failed because of the financial weakness of the producing countries. Martinez Rojas said any battle against organizations with budgets that were in most cases larger than the national budgets of the producer nations was doomed, in his words, “to be exorcised,” as indeed it was. The Sunday article touched on the triumphs of Dominican cacao in the world markets. Fausto Adames, one of Hoy’s economic reporters, said that the Dominican Republic is a world leader in the export of organically-grown cacao, and is famous for its quality, aroma and flavor. Isidoro de la Rosa, the executive director of the National Council of Dominican Cacao Growers (CONACADO), confirmed this opinion, as he detailed the facts that 15% of the total area dedicated to the production of cacao is classified as organic. This represents 300,000 tareas (about 17,000 hectares or 50,000 acres) of land for the organic cacao crop. Unfortunately for the producers, the total cacao crop has fallen from over 1 million quintales (with 100 pounds per quintal) ten years ago to just over half a million quintales last year. On a more positive note, processed cacao exports rose by 51% and organic cacao exports rose to over 7,000 tons. Well-known names such as Carrefour of France and Sudbury of England have signed contracts with Dominican exporters from San Francisco de Macoris and Hato Mayor.
A welcome bit of news from Venezuela was reported in most of the papers on Saturday. Hoy, for example, says that Dominican Ambassador to Venezuela Manuel Morales Lama has said that the diplomatic crisis that motivated the suspension of oil shipments from Venezuela in 2003 is now over and that oil would flow normally. The Listin Diario gave the story its headlines on Saturday, saying that the ambassador had met with Venezuelan oil kingpin Ali Rodriguez, the head of PDVSA, formerly known as Petroven, and established that shipments were, in fact, back to normal. This information was contained in a press release from the office of the Venezuelan Vice-President. Of course, both papers mentioned the accusations made by Venezuelan President Hugo Chavez regarding a coup attempt that former president Carlos Andres Perez was supposedly staging from Dominican soil. The suspension of Venezuelan oil cost the Dominican Republic an additional US$800,000 a day, as the Dominican Refinery looked for oil from other sources. The refinery supplies 66% of the local demand of 144,000 barrels of petroleum products daily. The private sector also imports oil from Venezuela, as well as from the Persian Gulf, mostly for the production of electricity. Sixty-five percent of oil imports are semi-refined and come from Venezuela and Trinidad-Tobago, with the remaining 35% refined at the Dominican Refinery which is run by the Shell Company in partnership with the Dominican Government. Major private-sector importers are Falconbridge Dominicana, Central Romana, Coastal Petrolium Dominicana and Mundogas America Dominicana.
The debate over the toxicity of the thermoelectric ashes being dumped on the Samana Peninsula is still front-page news, albeit below the fold. The latest information, written by Manases Sepulveda, says that scientists and environmental experts believe the residue from coal-fired thermoelectric plants to be highly toxic when mixed with water or air, but is useful in construction. The waste matter is used in cement, in bricks and in prefabricated concrete pieces. The coal used to produce electricity contains any number of metals such as lead, sulfur, cadmium or strontium. Storage of this waste is highly-sophisticated and requires million-dollar investments for infrastructure, including the waterproofing of the ground, drainage canals, and specialized personnel. The components of the “rockash” are listed among the “List of Dangerous Residues in the European Union,” which also specifies a rigorous set of rules for transportation and storage of the ash. Readers should also know that Samana registers the highest rainfall in all of the Dominican Republic, providing further complications for storage of the substance. Alejandro Salazar, an environmental specialist from the University del Valle in Columbia, mentions in a report seen by Hoy that these waste products, left out in the open, are a serious danger due to their exposure to air or water, since leaching will affect the ground water, and in this case the marine fauna along the coastline.
Hoy’s Page-2 editorial called “Que se Dice” enjoys taking shots at some of the contradictions seen in our political and social scenarios. On Sunday, two of those targets were the Metropolitan Transit Authority (AMET) and Osmar Benitez, the former executive vice president of the Agrobusiness Board and the agriculture specialist of the free trade negotiating team. The author says that it is notoriously obvious that the AMET agents are no longer as zealous at their jobs as before they were annexed to the National Police. During peak traffic hours, the absence of the AMET agents at the most important intersections is very noticeable. There are rumors that AMET boss General Pedro de Jesus Candelier no longer even goes to his office. Those in the know are not talking. As far as Benitez is concerned, the columnist says that the successful consultant to the private sector and collaborator with the Dominican government for many years, and who recently angered the negotiators from the United States so much that he was removed from the negotiating team, was just named a representative of the G-33 at the World Trade Organization. Benitez, who was objected to, blocked out and told to be quiet in Washington, will now be the spokesperson for nations such as China, India and the other members of the Group of 33. It seems his ability to irritate and infuriate the US negotiators is the ideal qualification to fight the battles against the great powers in the ring of globalization.
El Caribe reported on Sunday and again today that the presence of French troops on the Haitian border seems to indicate that the provisional government will be taking control of the troubled area around Juana Mendez (Ounaminthe). About twenty troops arrived Saturday in Juana Mendez as part of the plan to take control of the northern region of Haiti. The soldiers went as far as the International Bridge which crosses the Massacre River and divides the Dominican Republic from Haiti. One of the troops, using rebel leader Johnny Cesar as an interpreter, said that 150 more soldiers would be arriving on Sunday in time for the new civilian authorities to be in place by Monday. Since 19 February, the frontier has been controlled by elements of the Resistance for Peace in Haiti, which have charged tolls and taxes for crossing over the border. As a result, the traditional commerce between the two nations has slowed to a crawl. El Caribe’s edition today carries a story on Page 8 that includes a photograph of Jonny Cesar. The story emphasizes that the presence of the French contingent should slow the use of the border as a bridge for the narcotics trade. The troops are part of the French Foreign Legion, “hard people”, according to sources in the Foreign Ministry in Santo Domingo. These sources said they have not received official word as to what role the troops will be playing along the frontier. One positive sight, however, was the renewed activity of the traditional market held each Monday. Groups of Haitians and Dominicans began arriving late Sunday to set up their stands in time for the early morning market.
While the Listin Diario headlines that a peregrine falcon has been lost, the body of the story tells another story. The bird, identified with the number 788-47361, from Maryland, USA, is currently resting at the home of the Valoy Veras family in Santo Domingo. How it got there reflects on how birds of prey are treated in the Dominican Republic. According to Adriana Peguero, the Listin reporter, the handsome bird arrived at the Valoy Veras household via their friend, businessman Francis Chanel Abreu, who had paid RD$400 for it from “a guy who had him for sale.” After first offering RD$1,000 for the bird, Abreu thought better of the deal and said that RD$400 was a better price – “take it or leave it.” Believe it or not, the “lucky” bird went to Abreu, because the other bidders offered less and their intentions were to eat the endangered-species bird. The peregrine falcon is a bird of prey that hunts during the day, and can reach over a foot and a half in length. It is famous for its speed and strength. Abreu, however, not particularly astute with his ecological facts, told reporters he bought the bird thinking it was an eagle. When he saw the ID bracelet on the right leg, however, he realized that there were international implications, and gave the bird to his neighbor, Leo Valoy Veras, until it was determined what to do with the animal. Currently, the falcon is being kept in a large cage, where it has refused to eat and looks a bit unhappy. Contact emails can be sent to: bolivarveras@hotmail.com or consultorp2001886@hotmail.com
Today’s El Caribe reports that there will be 150,000 volunteers in 2,000 spots around the country for the country’s famous Semana Santa celebrations. With the aim of reducing the number of accidents over the holidays, this year’s theme is “An Acident isn’t accidental.” Organized by the National Emergency Commission (CNE), and headed by Vice-Admiral Radhames Lora Salcedo, the prevention program is divided into three phases, the first of which will start on Thursday. The second phase will begin on 4 April and will emphasize preparedness for motorists. The final phase begins on Holy Thursday and will place thousands of young people along the highways and waterways of the Dominican Republic to provide help and advice for the travelers. There will be some tough measures taken this year and Lora Salcedo told reporters that there will be buses placed along different roads to give drivers “a safe seat” if they are violating the traffic laws. Motorcyclists with their papers in order and helmets on their heads will not be bothered. This year there will be huts equipped with communication gear and first-aid equipment to tend to accident victims.
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