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Daily News - Friday, 22 June 2007

Big borrowing from Brazil
At a time when the government tax revenue surplus is at an all-time high, the Fernandez administration has chosen to increase the country's debt to record levels. President Leonel Fernandez has announced in Brazil that the country will be undertaking major loans from Brazilian banks once the commitment for a borrowing ceiling with the International Monetary Fund ends in January 2008.
Today's Listin Diario reports that the Banco de Brazil has approved lending for the purchase of 300 Brazilian buses that will come from a US$350 million financial package with the Brazilian banking. The DR will also be taking a Brazilian US$93.7 million loan to purchase eight Brazilian-made Super Tucano airplanes for the Air Force.
Of the total US$350 million in Brazilian loans, US$64.7 million have already been used in the construction of an aqueduct in the northeastern part of the country. This aqueduct was constructed by Brazilian company Andrade Gutierres.
Yesterday, the Chamber of Deputies approved four loans from Brazilian banks for US$202.5 million, for the financing of hydroelectric project in Pinalito, that is being built by the Brazilian Norberto Odebrecht company, and two loans for the Palomino hydroelectric generation facility (US$30 million and US$81.3 million) and the construction of an aqueduct in Samana, for US$71.2 million, also being built by Norberto Odebrecht.

Deputies approve recapitalization
The Chamber of Deputies has approved, in a second reading, the recapitalization of the Central Bank. The recapitalization, for RD$320 million looks to cover the Central Bank's quasi-fiscal deficit and is part of an overall plan to resolve the Bank's long standing problems that include accumulated losses totaled at RD$202,140,583,810.00.

Senate approves tax cuts
The Senate has approved bills that will reduce taxes on alcoholic beverages and tobacco products, with the aim of reversing a decline in sales, and to cut taxes for individuals and businesses. The President had proposed a tax amnesty for people who had not filed taxes, a reduction on corporate taxes, and taxes on beer and cigarettes. Taxes on alcohol will be reduced by 50% and on cigarettes by 80%, with reductions to the luxury tax. In addition, taxes on income, tax on corporations, individuals and businesses owned by a single person will be reduced from 29% to 25% as part of a gradual tax reduction program. Everyone who qualifies for the tax amnesty has 45 days to take advantage of the break.

Less able to evade taxes
The crosschecking system instated with credit card voucher checks has enabled the Tax Department (DGII) to reduce the number of tax evaders. The DGII said that 5,800 people who weren't declaring the ITBIS (VAT) tax but were invoicing for the sale have been detected and will have to pay penalties and past taxes due. Law 8-04 granted the DGII direct control of payments made through credit and debit cards. The DGII says that reported sales increased from RD$501.4 million in 2005 to RD$569.2 million in 2006, up 13.5%.

JCE organizing a national debate
The Central Electoral Board (JCE) is organizing a national debate between the 2008 presidential candidates. The debate will allow candidates to speak on electoral issues, government programs and general topics of national interest. The cost of the debates will be covered by the JCE and is part of the overall electoral campaign reform process that is being proposed by many at the JCE. As for talk of campaign reform, the JCE is expected to begin discussions on changing electoral campaign regulations during the first week of July.

Inside details of Puig interpellation
Detailed reports received at DR1 from people who attended Environment Minister Max Puig's interpellation at the Senate yesterday point out that the initial press reports failed to highlight the fact that Puig did indeed show proof that efforts were being led by senator Ruben Cruz to covertly change the Sectorial Protected Areas Law 202-04. Furthermore, rather than an apology, Puig's emphasis was on expressing an interest in ending the confrontation now that the objective of bringing the issue into the open had been accomplished state the observers. Around 150 environmentalists attended the session in support of the Minister of Environment.
Senator Ruben Cruz had originally denied that meetings had been held to reform the law, although he latter admitted to this. During the interpellation, Cruz confirmed that he had held the meetings to reform the law in a discreet manner because fellow senator Charlie Marriotti had advised him that "absolute discretion" was necessary until the revised bill was far advanced, and that otherwise he would risk getting a bullet in his head or receive tempting offers for millions of dollars.
Environmentalist Nelson Batista of the Cibao Environmental Society (SOECI), explains that one of the letters presented as proof of the lack of transparency was one dated 4 June from the director of the Department of Geography at the state university, UASD, Tomasina Espinosa to the rector of the university. She advised the rector that she was recommending that the university should not take part in the talks because of the interests involved and the discretion the Senate had chosen when carrying out the meetings to modify the law.
Another letter dated 21 May 2007 that caused Puig to protest against Cruz is from Ministry of Environment official Mariana Perez. In the letter, she mentions that Cruz's honorary advisor, ecotourism expert Bolivar Troncoso had called the meeting and one of the objectives was to remove beach areas from protected parkland areas. Troncoso also recommended that the Senate commission seek the assistance of Environment Deputy Minister Dannerys Santana to modify the law. The Perez letter mentions that Senator Cruz told those present at the meeting that of the seven members of the environmental commission, only two were in agreement with the initiative to reform the law.
After presenting the two letters, Puig stated that since his objective of putting a halt to covert modifications of the bill had been accomplished, he would not continue the confrontations with Cruz. One observer who was present clarified that Puig never apologized, as originally reported in the press.
Puig defended his statements, which he said were made with the intention of safeguarding the beaches of the National Park of the East and Bahia de las Aguilas.
Batista of SOECI says that at the interpellation it was clarified that at Dannerys Santana's recommendation, the Senate sent a letter to Puig requesting a meeting to discuss the law, and that Puig did not respond with a meeting date.

High-rise Santo Domingo
Santo Domingo will soon be unrecognizable by anyone who has been away for five years. As reported in Clave Digital, in the so-called Poligono Central, the booming residential-commercial area between Winston Churchill, Ortega y Gasset, 27 de Febrero and John F. Kennedy avenues, there seems to be a high-rise apartment building going up on every one of the 184 blocks, replacing single-dwelling homes. Clave Digital says that 182 "towers" have been approved for the area, according to Vencian Ben Gil, City Planning director for the National District Municipality (ADN). These include 26 towers for Piantini, 16 for Paraiso and 28 in Naco. The towers reflect the distribution of wealth gap in Dominican society, with some penthouses going for US$3 million. [Maintenance fees are just as high, with some at US$1,000 a month, while luxury building dwellers are also subject to paying for "electrical potency," about RD$15,000 a month without consuming a single kilo. Thus high cost of living in these towers, makes them off limits for all but the very wealthy.]
There is also a change in mindset. Realtor Melido Marte told the newspaper that Dominicans have lost their fear of heights. He points to the highest towers that have gone up in another area, Anacaona Avenue, with the 38-floor Caney, the 30-floor Margot, and another 55-floors colossus due to start construction there. On Anacaona Ave. there is no limit on the height of the towers.
A report in today's Diario Libre says that the seafront Avenida Espana could be the next area authorized for high-rise construction. Avenida Espana is adjacent to the Sans Souci Marina project. A group of private investors, led by the Sans Souci company (Vicini Group) and the government have announced investments of US$700 million in the Santo Domingo port over the next three years. There will be a US$50 million investment in the terminal alone. The investment will include the construction of a marina, hotels, apartments and a casino.
Realtor Melido Marte attributes the boom in real estate lending to the fact that new banking regulations prohibit banks from lending money to their shareholders and as a result there is more external lending. He also says that interest rates are currently at a low. He says the pension funds deposited in banks are keeping these rates down.
He comments that the DR is also attracting much foreign investment. The 18-floor Plaza Quisqueya at the corner of Winston Churchill and Gustavo Mejia Ricart Avenues, for instance, is a US$60 million investment by the Venezuelan Grupo Allard Industries in coordination with Grupo Varma, which belongs to engineer Miguel Vargas Maldonado, former Minister of Public Works in the previous government and current PRD presidential candidate, as reported in the Clave article. There is also lots of Spanish investment in several towers.
Marte also explained that nevertheless most of the investment is from wealthy Dominicans who prefer investing in real estate than in Wall Street or depositing the money abroad.
In the interview, Ben Gil of the ADN acknowledges that the municipal authorities have not made provisions for the increased demand for parking spaces and greater traffic flow. "If we continue increasing the number of vehicles without parking or mass transit, the city of Santo Domingo will become uninhabitable. If we do not embark on integrated planning, the options for saving the city will be few."

Priest urges commitment to education
Father Jorge Cela, international director for the Fe & Alegria education program, urged a turn around so that there is more trickle down of funds to young people and education. "A country with such a strong economic growth is in danger of seeing the collapse of that growth if it is not sustained on human capital," he said as reported in Hoy newspaper. He said that there is no way to justify the government investing relatively so little in education when the country shows one of the highest growth rates in the region. He criticized the delays in the Ministry of Education assigning teachers to schools, and the large number of students to a single classroom, and the long work hours of the teachers.
Speaking on the Uno + Uno TV show produced by Juan Bolivar Diaz and Adriana del Conte, Cela explained: "Investing in education is not having one or two schools with many computers. Education is having quality education accessible to all the population," he stated. He believes education should be obligatory until a 4th grade level is reached. He commented that with an increase in education programs, there would be less violence. He pointed out that there are not many productive things that a 14 year old youth that is not in school can do. He urged the involvement of the entire Dominican society in the matter of investing more in education. He commented that in an educated society, there would not be obstacles to development, nor would there be violence, or lack of respect to laws.
Fe & Alegria is organizing a major fundraising event this Sunday from 12 to 6 pm on TeleAntillas, Telesistema, Channel 4, CDN, Color Vision and other TV stations to secure funds for the 31 schools they run nationwide in some of the poorest neighborhoods, benefiting 27,000 students. Their goal is to collect RD$10 million. Persons who want to contribute can send their funds to the Banco Popular account 054-14897, or contact them by calling 809 221-2786.

Police department cleaning house
A major, a captain and two low level officers in the National Police were dishonorably discharged from their duties for being part of a contraband ring and sent to justice. Dario Lorenzo y Lorenzo, Santiago Encarnacion, Juan Antonio Decena Javier, and Jose Joel Contreras Reyes are accused of robbing trucks that contained merchandise and selling the goods as contraband. These four former officers join Captain Generis Sanchez Moreta and Sergeant Major Ramon Antonio Duran Lopez, who had previously been accused of association with illegal activities. Those two officers were arrested on the 22nd kilometer of the Duarte Highway as members of a gang that was robbing a truck that was carrying whisky. Police Chief Bernardo Santana Paez said that there is no place for corrupt cops in the Dominican police force. The chief said that proof of the efforts to purge the police is that in the past these events would have been kept private and wouldn't have made headline news.

Phantom women caught
National Police is announcing that they have apprehended a woman accused of cashing RD$20 million worth of fake checks. Magalys Margarita Fernandez Ariza (Phantom Woman) is 55 years old and accused of cashing checks for US$20,000, US$360,000, US$85,000, US$90,000, US$85,000, US$75,000, US$385,000, and a check in the name of Bank of America worth US$405,000. Police say that she is part of ring that engages in such activities. Police are still looking for two other suspects, named as Yudith Adela Inmaculada Fernandez Martinez and Rafael Fernandez.

Senate will honor Sammy
Slugger Sammy Sosa received a phone call from President Leonel Fernandez yesterday, congratulating him on reaching the 600-homerun milestone. Fernandez, who is in Brazil, phoned the slugger, as did many of his Major League Baseball counterparts. Sosa was also congratulated by fellow Dominican athletes. The congratulations don't end there. The Senate has announced that they will honor Sosa and his achievement. A resolution was unanimously approved by the Senate yesterday.
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