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Daily News - Monday, 02 July 2007

From Hollywood to Domiwood?
President Leonel Fernandez met with movie producers from around the world for nearly two hours yesterday as part of his program to attract more attention to the Dominican Republic. Executives from Twentieth Century Fox and Spyglass Entertainment were sided by local producers Freddy Beras Goico and Juan Basanta at the meeting. According to Basanta, the President guaranteed film companies an institutional framework and the government's collaboration and good will for future projects. The meeting with film executives from India, Hollywood and New York opens the possibility that the Dominican Republic could become the next "Domiwood," exporting films to the international market.

Dominican flag planes will fly to the US
For the first time in 14 years, planes with tail numbers beginning in HI are authorized to fly to the United States. Tonight at 8pm President Fernandez will make the official announcement of the United States' Federal Aviation Administration (FAA) and Transportation Security Administration's (TSA) approval of Dominican airplane operations in a ceremony at the Presidential Palace today.

Calvo on toll roads
Former manager of the Central Bank Felix Calvo says that the Viadom 2007 program of concessions will not work. He calls it an "illusion" after looking at the flow charts of vehicular traffic along the proposed toll roads. He says that in the first place it is not possible to build or rebuild these toll roads with future income coming from those that will use the roads. In the second place, it is not wise to add to the public debt in the form of guarantees to builders that propose to develop the roadways based on inflated numbers for vehicular flows. The economist says that at the end of 30 years the traffic will not have produced earnings and then the guarantees will become part of the public debt.
He was commenting on the plan promoted by the Fernandez administration that would bring in private builders to operate concessions to widen and rebuild the main highways of the country - San Francisco de Macoris, Puerto Plata, Rio San Juan, Monte Cristi, Barahona, among others.
The Dominican Republic has 48,000 square kilometers and 8 million inhabitants, and the road system was designed by the American occupation troops in 1916. Since that time nobody has broken the mold of highways and we take, according to Calvo, many illogical routes, with some regions marginalized because of the highway system, not necessarily because of their geographical location.
Calvo says that in 2001 and 2002 he analyzed vehicular flows and only three points had sufficient flow to guarantee a return on investment over thirty years, even with toll adjustments every two years. He refers to the one on the Duarte Highway at Kilometer 25, the one on the highway to San Cristobal and the one on the Las Americas Highway leading to the airport. The return on investment, according to the economist, was not enough to "go crazy" over the profits.
Since the profits would be the result of the bi-yearly adjustments, the Dominican electoral cycle produces some "anguish" amongst those that receive the concessions. The best example of this is the empty toll plaza between La Vega and Santiago that nobody dares to put into operation. And so, he urges that the Viadom 2007 plan be re-examined in the light of Dominican reality. He reiterates in the opinion piece that the estimates made by the proponents of Viadom seem to be based more on realities in other countries, than those of the Dominican Republic.
Calvo suggests that it will be cheaper over time to change the orientation of the national roadways to serve the internal markets better. He states that the Dominican highway system is based on the "Haitian threat", and is therefore obsolete. Finally he says that it might be a good idea to take a map of the country and draw a straight line between San Juan de la Maguana and the Santiago International Airport.

JCE to control party finances
The Central Electoral Board has announced that it will take control of the finances of the political parties as a means of preventing narco-dollars from influencing the elections. The step also seeks to prevent ever-present economic interests from promoting patronage and the use of state funds. In order to carry out this program the JCE will audit the money handled by the parties and demand that any donation is accompanied by the name and address of the donor as well as any additional information required by the board. The auditing of the funds is part of the new set of rules laid out by the JCE last week.

High prices allow EDEs to make money
In spite of incredible losses to fraud and transmission problems, the nation's electricity distributors are making money. A lot of money. According to the Diario Libre, the EDEs, speaking generally, lose 41.1% of the electricity they purchase from the generators. The EDEs prefer to have the losses covered by the government with the energy subsidy lump payment. Another reason for the losses is that transmission lines are inadequate to the task, despite millionaire loans have been taken out to resolve this problem over the years. Nonetheless, the EDEs are making money. Using figures from last May, journalist Esteban Delgado reveals that the three EDEs purchased RD$2.62 billion in electricity from the generators. They collected RD$2.76 billion from their customers, and earned RD$147.0 million, in spite of the 41% loss in theft and transmission. According to the paper, the EDEs buy electricity at eleven cents of a dollar per Kw/h and sell it at 20 cents of a dollar per Kw/h. This margin gives them their profits. Furthermore, the analysis shows that Dominicans that are billed for power, pay for the service. Of the RD$1.26 billion filled by Edesur, RD$1.23 billion was collected. Of the RD$830.3 million billed by EdeNorte, RD$763.7 million was collected. And of the RD$828.1 million billed by EdeEste (the only private company), RD$776.5 was collected.

FTA talks with Canada
Canadian Ambassador Patricia Fortier told Hoy newspaper that a new round of trade talks are expected to start no latter than August. The DR was to negotiate a free trade agreement with Canada in xxxx, but this was discontinued when talks began for a trade agreement iwht the US, which is the DR-CAFTA. Fortier said that there have already been preliminary meetings. Canada has FTAs with the US, Costa Rica and Chile. She said that they are also holding ongoing talks for FTA with Peru and Colombia. She explained that the DR has potential to export tropical fruits to Canada, such as papaya, coconuts, melon and mango, coffee. Bilateral trade with Canada and the DR was US$277 million in 2006.
The ambassador estimates that 25,000 Dominicans live in Canada, and 10,000 Canadians live in the DR. She says that 600,000 Canadian tourists visit the country.
Major Canadian businesses here are YVR airport operation, Scotiabank, SNV Lavalin.

Food fair a success
The first international food fair, Agroalimentaria 2007 was an all around success, way beyond organizer's most optimistic expectations, Mario Velazquez, president of the organizing committee, told the press. The goal was to bring 60 buyers from abroad. The fair attracted 152 buyers from major distribution centers worldwide. Both organic and convention produce were transacted. Products with the most demand were: bananas, cacao, coffee, mangos, avocados, pineapples, melons, lemons, oriental vegetables, condiments, concentrated juices, sweets, marmalades and dried fruits.
Businessmen say that more than US$3 million in contracts for farm and agribusiness products were signed with visitors from US, Europe, Asia and Africa. Buyers came from New York, Massachusetts, Florida, California (representing retailers in Hong Kong) and Boston in the United States, Canada, Puerto Rico, St. Martin, Trinidad & Tobago, Barbuda, Grenada, Spain, England, France, Germany, Portugal, Italy, Sweden, Holland, Japan and Taiwan.
The Dominican Agribusiness Board (JAD) and the Center for Export and Investment (CEI-RD) organized the fair.

Basic foodstuffs up in price
Basic product prices have been going up, reflecting increases in energy and transportation costs, for the most part. Bottle water has increased 37%, milk by 10% and garlic is up 75%. According to the Listin Diario, onions, edible oils, dental cream, beans, chocolate, smoked herring, and tomato paste have also increased in price. Rice has maintained a steady price of between RD$15 and RD$18 pesos per pound, depending on the type of rice. Pastas have also held their price levels. Some persons connected to the provision market are saying that the tighter government controls put together by the DGII have affected retailers, at times of higher fuel prices.

Rumors heat up milk markets
Rumors surrounding new price increases of powdered and liquid milk have upset the local markets. Milk farmers denied rumors that milk prices will soar to RD$100 pesos per liter (from the present RD$30-40). According to spokespersons from the sector, local producers are capable of supplying demand through increased production, if the conditions established by the law are observed.
Customs (DGA) director general Miguel Cocco warned reporters that poor children would not have access to milk if the current prices were held for a long time. According to the Listin Diario, Cocco said that the government would find a solution to the problem. According to the paper, international prices for milk have increased 60% over the past few months, and the president of the National Federation of Retail Commodity Merchants, Jose Matos did not discredit rumors that the price of the large tin of powdered milk could reach the RD$1,000 mark by year's end, up from RD$600 at present.
According to spokespersons from the Association of Milk Producers said that some unfair trade practices had introduced out-dated cheeses into the local market, to the detriment on local producers. According to Marcelino Vargas of Aproleche, local production is sold at low prices.

No way to check milk
In a slightly related story, the Office of Weights and Measures (DIGENOR) revealed that it does not have the necessary equipment to analyze milk products. This problem was revealed by spokespersons from the National Cattlemen's Association and the National Council for the Regulation and Promotion of the Milk Industry (CONALECHE). The cattlemen's spokesperson, Eric Rivero, together with the milk industry spokesperson Juan Recio, told Hoy newspaper that they were assisting DIGENOR so that their technicians could get the training needed to study dairy products now selling in the local marketplace. The two organizations are also supporting the efforts of the Ministry of Public Health to supervise the condition of milk products in the marketplace. Part of the assistance was the in-service training of personnel at the University of Mayaguez in Puerto Rico. Conaleche says that it has obtained much of the equipment needed to identify the contents of dairy products and is acquiring even more. The idea is to guarantee that what the label says is absolutely correct. Part of the incentive of these two associations to assist the government identify the contents of milk products has been the introduction of non-milk cheese into the local market.

Ethanol might not have enough land
Enrique Martinez, the director general of the State Sugar Board (CEA) said that there is not enough sugar cane fields available to supply all the ethanol projects currently under study. According to the El Caribe, Martinez said that "there are a lot of people talking about ethanol, but they are totally lacking in knowledge as to the availability of land to produce it." However, the opposite point of view has been taken by the Dominican Agro-Business Board (JAD) that is estimating that within two years ethanol production will increase sugar cane acreage by one million tareas (equivalent to 166,000 acres) without diminishing local sugar production. Nonetheless, Martinez said that he doubted that a private consortium could obtain so much land for the production of ethanol. He did say, however, that by joining all of the lands of the Sabana del Guabaquico, plus the lands of the old River Haina Sugar Mill in Monte Plata province, and some other lands, it would be possible to establish a new sugar mill for ethanol. He insisted that the projects involving the Boca Chica Sugar Mill and the new investors that would operate the Consuelo, Quisqueya, Porvenir and Santa Fe mills are based upon unrealistic estimates.

Betting parlor woes
The more than 24,000 employees of the betting parlors disseminated around the country are calling for increased benefits for their long hours of work. According to the El Caribe, most of these employees are young women, and most of them do not receive the normal benefit package of other workers. According to the paper, the smallest of the betting parlors does at least RD$5,000 in business on just one of the two lotteries currently running in the Dominican Republic. If the parlor does business with both lotteries, business doubles to RD$10,000 or RD$12,000 per day. This means that the small stall just down the street is producing perhaps as much as RD$4.3 million per year in gross income. Nancy Molina works at a betting parlor and she says that most employees earn between RD$3,500 and RD$6,000 per month. According to the report in El Caribe, most do not receive the yearly 13th salary at Christmas time nor are they covered by medical insurance. Elaine Pimentel said that she works from two until nine at night, Monday through Saturday and Sundays until six. She earns RD$6,000 per month.

Police graduate 500 new patrolpersons
At the Police Academy located in Hatillo, San Cristobal, the National Police graduated 521 patrol men and women. The new graduates will be assigned to Santo Domingo and Santiago patrols under the Democratic Security Program. Speaking to the new graduates, Police Chief Bernardo Santana Paez urged them to respect human lives and civil liberties. Santana reminded the new officers that the Cold War is over and that the persecution of ideas no longer has a role to play in the police. The chief said that now is the time to fight crime, but without violating a person's civil rights. He promised to continue training those currently on duty and to recruit more university students for the force. Of the 521 graduates 453 are men and 68 women. Of these, 119 are currently enrolled in university programs.

Dell fined RD$116.5 million
The judge at the Third Chamber of the Civil and Commercial Court in Santo Domingo ordered Dell, the computer giant, to pay a RD$116.5 million indemnity to Xolutiva, S.A., their former local representative. The Dominican company had asked for RD$300 million compensation payment because Dell unilaterally withdrew its marketing agreement in violation of Law 173 on International Representations. According to the sentence handed down by the magistrate, Xolutiva had represented Dell in the DR since 1997. Dell decided unilaterally not to renew its contract with Xolutiva. The court invited Dell to send representatives to the trial on two occasions, but Dell refused on both opportunities.

Dominican wins in kiteboard tour
For the first time a Cabarete-made kite boarder has won the Cabarete stop of the Professional Kiteboard Riders Association 2007 World Tour, held 26 June to 1 July with US$40,000 in prize money. 15 year old Ariel Corniel won first place defeating runner up Spaniard Alvaro Onieva. Third place went to Frances Mallory de la Villemarque, and 4th place to Dominican Alex Soto.
Bruna Kajiya won the women's division. Second place to Gisela Pulido of Spain, and third to Karolina Winkowska.

Ten go to All Star game
Ten Dominican baseball players could be in the All Star Game at AT&T Park in San Francisco next week. There will be five starters and five substitutes on the teams form the American and National Leagues. American League manager Jim Leyland left Sammy Sosa out of his team. Instead, Leyland chose the Texas Ranger shortstop Michael Young. Most sports reporters were a bit surprised at the move. Sosa is batting in the mid .250s, has 14 home runs and leads the Rangers in RBIs with 63. Young has a higher batting average at .293, but only 4 homers and 38 RBIs.
Starting for the American League will be Boston's David Ortiz at first base, Detroit's Placido Polanco at second, the Yankees Alex Rodriguez at third and Vladimir Guerrero of the Anaheim Angels in the outfield. Manny Ramirez will substitute in the outfield. For the National League, only the Mets' Jose Reyes at shortstop will start the game and Jose Valverde (pitcher/Arizona Diamondbacks), first baseman Albert Pujols (St. Louis Cardinals), Milwaukee's Francisco Cordero (pitcher), and Chicago Cubs outfielder Alfonso Soriano will come off the bench. The winner of the All Star Game decides the home team for the World Series in October.
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