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Daily News - Wednesday, 07 March 2007

Closer ties with Saudi Arabia
Foreign Relations Minister Carlos Morales Troncoso met Prince Saud al Faisal at the Ministry of Foreign Relations of Saudi Arabia. "The time has come to formalize our friendship ties. This historic visit shows the interest of your government and President in closer relations with our region," said Prince Saud. The DR is expected to shortly establish full diplomatic relations with Saudi Arabia, along with a generalized strategy of improved ties with Latin America. At the meeting, over topics covered were the interest of the DR in a seat in the UN Security Council, the strategic geographic position of the country, the DR-CAFTA agreement, the pro tempore presidency of the DR at the Rio Group, the increase in Arab tourism to the Caribbean, and business opportunities in the DR for Arabian businessmen were also discussed.
Morales Troncoso highlighted the fact that there are a large number of Latin Americans, Dominicans included, of Arabian descent, and thus common customs, values and heritage link the citizens of both regions. "It is important to forget the distances that separate us and find ways to connect both at the diplomatic, touristic and cultural levels," said the minister. He commented that the Rio Group could be the stage to make possible this strategic alliance.
Present at the meeting was Ambassador in Qatar Hugo Guiliani Cury and Ambassador in India Hans Dannenberg Castellanos, who from their missions will follow up with the agreements reached during the visit to Saudi Arabia.
As part of the events planned for the visit of the Dominican mission a country presentation was organized by the Chamber of Commerce and Industry of Riyadh.

Coal-fired generators, redux
Once again the issue of the very large coal-fired generators planned for Azua and Manzanillo is in the news. Radhames Segura, head of the CDEEE, told reporters from Diario Libre that the financial deals necessary for these generating stations are nearly closed. He announced that actual construction of the sites would begin in April and May this year. According to Segura, President Fernandez might well do the honor of inaugurating the construction in Montecristi in April. The installation in the Manzanillo Bay area will be under the supervision of the Sichuan Heavy Machinery Corporation. In May, the Seaboard and Vicini consortium will begin work on the Azua site. Costs are estimated at US$1.2 billion.

For deputies, "Food comes first"
Apparently in the spirit of one of their party slogans, members of the Chamber of Deputies prefer to eat instead of working on pending legislation. For the 18th time in 49 sessions the deputies failed to make a quorum and the session was recessed. Congress leader Julio Cesar Valentin's efforts to work through the 35-point agenda came to a halt after deputies voted on just two of the issues. All this comes after a two-month recess during which the deputies continued to receive their much-envied salaries. According to Diario Libre, three votes were cast, but the absence of a quorum rendered them invalid, even after waiting for the required five minutes. When Valentin tried, once again, to obtain a roll call vote, the lack of a quorum forced him to recess the session, much to his displeasure. Valentin ordered the deputies' restaurant to be closed between the hours of 11:00am and 3:00pm, and this, according to Valentin, should give the deputies enough time to clear the agenda. Diario Libre says that statistics from the Chamber of Deputies show that close to 37% of the sessions have been recessed due to a lack of quorum during votes. Valentin spoke with PRSC and PRD leaders in order to reach a consensus about the restaurant's closure.
Deputy Pelegrin Castillo explained today on the 106.5 FM radio talk show of Rafael Molina Morillo that party politics are behind the no shows. The PLD is majority in Congress and its deputies are divided by adhesions to President Fernandez who is expected to seek reelection and former Secretary of the Presidency, Danilo Medina, who is actively campaigning to be chosen the PLD candidate in the 2008 presidential election.

No sugar for the European Union
Despite recent news items about the possibility of the Dominican Republic exporting sugar to the European Union, the EU has apparently not offered nor will it offer a sugar quota within the economic agreement that will be signed with the ACP (Africa, Caribbean and Pacific) nations. According to Diario Libre, what chief EU negotiator Karl Falkemberg has proposed is a reduction of the other Cariforum countries' quotas, as well as a reduction of tariffs, both of which would allow the Dominican Republic to offer its sugar and gain a share of the European market, if prices are favorable. Hugo Ramirez, a member of the Dominican negotiating team told the newspaper that Falkemberg said that "the reformation of the European system will force internal prices to fall substantially, and this will cause the subsidies to fall. Without subsidy protection and high tariffs, the market is free for all." The European negotiator also said that he proposed to dismantle the current sugar protocols that benefit all the Caribbean nations except the Dominican Republic. The idea is to eliminate quotas.
Meanwhile, sugar stats indicate the DR does not have inventories at present to export to Europe.

Rules of origin give boost to DR
DR-CAFTA gives the Dominican Republic the opportunity to export products made with raw materials from any country. The CAFTA deal is more flexible than the US's NAFTA agreement with Mexico and Canada. This flexibility will allow the DR to attract new investments, not only from countries that don't have a free trade agreement with the United States, but also from Mexican sources. According to Diario Libre, what is happening is that Mexico's agreement with the US stipulates that 50% of raw materials have to come from NAFTA nations, which increases costs. In the case of DR-CAFTA, the raw materials can come from any nation, with the only stipulation being that the final product is manufactured or assembled in the Dominican Republic. In the past, 35% of raw materials of any product shipped to the US under the old Caribbean Basin Initiative (CBI) had to come from the US. Because of the new flexibility, investors from China and Mexico are considering the possibility of transferring their operations to the Dominican Republic. However, the same conditions that exist for the DR also exist for the Central American CAFTA member nations, and the government must offer enough in the way of incentives to guarantee that the investments come here and not there.

Capellan on industry issues
One of the leaders of the free zone industrialists and a spokesperson for the sector, Fernando Capellan was interviewed by reporters from Multimedios del Caribe, the publishers of El Caribe newspaper. During his interview, Capellan revealed how what he called "a mafia of lawyers" was exploiting workers and employers alike. As president of Grupo M, one of the larger free zone enterprises, Capellan denounced the existence of these law firms that encourage workers to claim liquidation payments and then purchase their rights. According to data collected by El Caribe, 95% of cases are settled in favor of the worker, while on a national scale the average is 65%. Capellan says that some adjustments to the Labor Code are needed in order to put an end to the problem of "extortion" that is threatening to bankrupt many of the smaller businesses in the Santiago industrial cluster.
According to Capellan, the Labor Code has been "hijacked" by some people and needs to be "enriched" in order to protect investors. The industrialist told the reporters that the code has fulfilled its original purpose and now needs to be reformed in order to create more jobs and prevent the huge number of labor cases that are being created because of what he calls a "bad interpretation of the law." He was particularly critical of articles 539 and 86 of the code.
For readers who don't understand the issues in question, Capellan explained that when the Santiago Free Zone began operations, the owners were mainly foreigners and when they went on vacation during December and January, they would liquidate their employees. When work resumed in February, the same workers would be re-hired. The process became a tradition and the annual "liquidation" of workers was considered a triumph for the workers. The problems arose when lawyers began to argue that workers who were "liquidated" in December and re-hired in February were, in reality, continuing in their jobs and if a factory was going to totally cease its operations or the worker was going to be fired, the owners should pay the worker compensation for all of the years that worker had been at work, despite being liquidated each year. These cases were upheld in the labor courts and this has forced the factory owners to create a labor reserve contingency fund of unproductive capital.
Capellan pointed out that this is one of the issues that need to be resolved in order for the free zone factories to continue in existence. He said that the DR-CAFTA agreement is a second step forward. The issue of the overvalued Dominican currency is the third step needed, and Capellan said that what the industrialists mean by this was not a devaluation of the peso but rather a stabilization and real market value for the currency. He reminded the reporters that the free zones experienced their greatest expansion during the period when the peso was at 3 to the dollar and 16 to the dollar. And the fourth step needed for the survival and recovery of the industry is the creation of a good lobby in Washington, D.C. to look out for Dominican interests.

Attorney General to cleanse files
The Attorney General of the Dominican Republic has announced the beginning of the cleansing of 635,000 police files on citizens and residents of the Dominican Republic. The AG announced that any file that was not accompanied by a judicial conviction would be eliminated. The first step will be to go through the files dating back to the Trujillo dictatorship up to 1996. The commission meets at the Attorney General's office and will have the support of the police and the DNCD and the National Bureau of Investigation (DNI).

Strikes in Bonao, Salcedo and Santiago
Two people were wounded and 10 arrested during demonstrations in support of the 24-hour strikes in Bonao and Salcedo. The strikes were successful in both provinces, with schools, public offices and stores all shut down. In the province of Monsignor Nouel (Bonao), the people were asking for a roadway between the villages of Arroyo Toro and Masipedro, the completion of the UASD university branch, a public library and the paving of streets in the barrios. All the reported injuries and arrests were in Bonao. There were no reports of injuries in Salcedo. The strike was lifted in order to open negotiations with government officials, including the Minister of Public Works, Freddy Perez. Like Bonao, the Salcedo strikers were calling for better roads and other public works. In Santiago, residents of the Yaguita de Pastor area took to the streets in demand of street repairs. Homemade explosive devices and police tear gas were both in evidence.

Chief sends 100 patrols to the streets
Police Chief Bernardo Santana Paez has assigned 100 new patrols to the streets of Santo Domingo. The patrols will work in the central neighborhoods of Naco, Piantini, Winston Churchill Ave. and surrounding areas. More patrols are scheduled for the Kilometer 9, San Carlos and Cristo Rey areas of the nation's capital. Seventeen officers will be supervising the new patrols and their base will be Command Post C-1, located in Naco.

US State Department on human rights
The latest State Department report on human rights in the Dominican Republic could be seen as positive or negative, depending on which newspaper one reads. Listin Diario says that the State Department accuses the Dominican Republic of practicing serious discrimination against Haitians and their descendants. In contrast, El Caribe's article starts by saying that "human rights improved in 2006", and says that the report applauds the elections in May as "free and fair". According to El Caribe, the State Department comments on the 650,000-1,000,000 undocumented Haitians in the Dominican Republic. The report goes on to mention that the new chief of police (who is not named - Bernardo Santana Paez) has "improved" the department, although it said that abuses were still committed against suspected criminals. The report also mentions violence against women, child abuse issues and prostitution.

John XXIII Center is a model
The John XXIII Health Care Center is now ten years old and is described as a model for community-based health care in the Dominican Republic. The facility, located in the southern part of Santiago, is run by the PUCMM University in conjunction with the Public Health Ministry and the Southern Zone Health Council (CODESA). Center director Sergio Diaz reported that during the past year the center treated 55,576 emergency cases and provided 31,628 outpatient consultations. The center operates on a budget of over RD$8.0 million per year, most of which is self-generated. Prevention is one of the key elements of the center and personnel from the center have given 52,000 talks to groups on health issues and prevention. The John XXIII Center is the focus of a network of two basic care clinics, 22 community homes, 16 supervisors and 130 health promoters from the community it serves.
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