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Daily News - Tuesday, 17 July 2007

Las Placetas Hydroelectric Dam
President Leonel Fernandez attended the groundbreaking ceremony for the construction of the Las Placetas Hydroelectric project in San Juan de la Maguana yesterday. He was accompanied by Brazilian ambassador Ronaldo Dunlop and Angela Gutierrez of the Brazilian building company Construtora Andrade Gutierrez.
The hydroelectric plant will be constructed with an initial cost of US$286.2 million and will have installed capacity of 91.2MW. The construction is funded by BNDES, the Brazilian government export financing agency. BNDES will finance US$71.2 million in Brazilian goods and services for the construction that will be carried out by Construtora Andrade Gutierrez. The original plan starts in Rio Bao, with the construction of a storage dam. The dammed water will be led by gravity through a tunnel to Rio Jagua.
The plant will help reduce the DR's dependence on imported fuel and help the country fulfill its responsibilities to the Kyoto protocol. The government says that the operation will relieve the country of having to purchase 638,000 barrels of oil, currently equivalent to US$41 million per year. The contract for the construction was signed in 2005.
The Fernandez administration has contracted several loans for infrastructure works with the Brazilian government, including the UHE Palomino Project (Construtora Norberto Odebrecht) for US$81.3 million and besides the Palomino and Las Placetas operations, BNDES depends on financing for exports of Brazilian goods and services destined to infrastructure projects in the Dominican Republic to the tune of US$310 million. Among those projects UHE Pinalito stand out, with financings to Brazilian exports of US$101.5 million, the Northwest Aqueduct, phase 1 and phase 2, in the amount of US$194 million, and the Santo Domingo road signposting project, with US$13.8 million. Brazilian financing was also recently contracted for the construction of an aqueduct in Samana also with Odebrecht. No tenders were held for any of these projects.

The foreign debt
According to Listin Diario, in absolute terms the Dominican Republic's foreign debt stands at US$7,640.7 million, up from US$7,266.1 million in 2006. The International Monetary Fund established a US$410 million ceiling for borrowing in 2007. According to the Ministry of Hacienda, the foreign debt in 2006 was 26.3% of the Gross Domestic Product. Estimates for 2007 are that at year's end it will be 22.4% of the GDP.
Listin Diario points that other reports indicate that the foreign debt has increased by US$6 billion since the end of the Mejia administration, in August 2004. Government figures indicate that the public sector debt reached US$8.421.2 million as of March 2007, equivalent to 25.65% of the GDP. Of that total, US$7.283.73 million correspond to foreign debt and US$1,137.50 to internal debt (Treasury Bonds of laws 104-99, 172-03, 119-05, 120-05 and 121-05 and Treasury certificates).

Explaining high prices
Although generally speaking prices are still lower than they were in 2004, as was reported in yesterday's DR1 news, analysts in today's Diario Libre explain why food prices have continued to rise. According to the article, the increase in food prices is due to the three fiscal reforms that have increased tax levels over the past three years. Finally, the increasing cost of electricity and the high cost of gasoline and diesel used to distribute goods, also due in part to increasing taxes, have affected food prices.
The Central Bank has come out on the offensive by disputing the claims that prices are too high. Today's papers carry a paid advertisement by the Central Bank headed, "The reality of prices." The ad says that between August 2004 to June 2007 prices only increased by one digit, while between August 2002 and June 2004 prices increased by 133.05%. The Central Bank advertisement also says that critics fail to point out that even though exchange rates have fallen the fact that fuel prices have increased by 50.2% has directly affected food prices. The advertisement continues by saying that in order to make these comparisons the Consumer Price Index needs to be taken into consideration and that the DR's CPI is compared daily with the index in other countries.

Importers have 60 days
The Customs Department (DGA) is giving importers 60 days to publish the values of the freight charges that goods that were brought into the country have had to pay in the last 48 months, and say that failure to do so will lead to fines. Customs says that importers have 60 days to comply with Law 146-00 and make the corresponding rectifications. Hoy writes that a problem with importers making declarations is that they undervalue products with the aim of reducing freight charges.

Plate renewals set for August
Beginning in August the Metropolitan Transit Authority (AMET) will open license plate renewals. The process will continue until the end of October. The cost of a renewal will now depend on the year of the car and luxury cars will be subject to higher renewal fees. Cars that are owned by individuals and that are between one and five years old will pay a percentage based on the car's original registration fee. Cars between one and two years old will pay a 1% fee on the value of the car for its first registration, with a minimum of RD$5,000. Cars between three and four years will pay 0.75% of the car's initial registration fee with a minimum of RD$3,000. Cars between five and ten years old will pay RD$3,000 and cars that are older than 10 years will pay RD$1,500. Luxury cars that previously paid RD$2,200 will now pay up to RD$20,000. Cars that were subject to RD$1,200 will now pay between RD$1,500 and RD$3,000. Cars that are registered to companies will pay 1% of their book value. If the value is zero, the tax department (DGII) will apply an estimate. These values will be adjusted for inflation.

Clinton visiting the DR
Former US President Bill Clinton will be visiting the DR today at the invitation of the Presidential AIDS Council (COPRESIDA). As part of his Clinton Foundation HIV/AIDS Initiative, Clinton is committed to curbing the spread of HIV/AIDS by expanding access to life-saving medicines and in helping developing countries systematize their approach to HIV/AIDS treatment. Clinton will be accompanied by an entourage of 32 people, including 12 journalists. The former President will visit the Robert Reid Cabral Children's Hospital at 3pm and will then head to the Presidential Palace to meet with President Leonel Fernandez and First Lady Margarita Cedeno at 5pm. The reason for Clinton's visit is to promote the Pediatric Initiative, which includes the participation of COPRESIDA, USAID and the Public Health Ministry. For more information, go to

Malaria under control
The government is denying reports in the Spanish press that claimed there was a malaria epidemic in the DR, stressing that last year of the three million tourists who visited the DR only two people, one French and one Canadian, reported being affected by malaria. No tourists have been affected by the disease this year. Health Minister Bautista Rojas Gomez says that the government runs constant programs to contain malaria that may come over through migration from Haiti. Rojas says that since 18 January there have been 1,337 cases of malaria in the DR in comparison to 2,348 cases for the same period on 2006. Rojas says that at present malaria, diphtheria and tetanus are under control in the DR.

What are they hiding?
On the front page of today's Diario Libre is a large photo of the Santo Domingo Metro. The photo, taken at the intersection of Correa y Cidron and Lincoln Avenue, has the caption proclaiming, "The picture they didn't want Diario Libre to take." The caption continues by explaining that Metro workers are working on the tunnel where a collapse took place last week and that military officers have been posted there to prevent photographs from being taken. Diario Libre tried to get an official comment from the Office for the Reorganization of Transport (OPRET), but their phone calls were not returned. Traders in that area have also complained that construction has hurt their businesses as it has in many of parts of the city where construction has taken place. Pharmacist Carlos Berges says that his sales have decreased by 60% because of the Metro project. Lack of information forthcoming from the builders has spurred much speculation.

Indotel virtual classrooms
The Dominican Telecommunications Institute (INDOTEL) has announced the opening of 114 digital classrooms in schools, universities and communities in 32 provinces. INDOTEL head Jose Rafael Vargas says that the institute has spent more than RD$1 billion on building these centers that are aimed at improving peoples knowledge of and access to the Internet. During a press conference, Vargas said that the goal is to build 635 classrooms by the time 2008 comes around. Since 2005, 236 virtual classrooms have been installed.

More Internet accounts
There are 273,082 Internet accounts in the DR, as of 30 June, according to the National Commission for the Information Society (CNSIC). Speaking for the CNSIC, Jose Rafael Vargas, who is president of the Dominican Telecommunications Institute4 (INDOTEL), said this includes 77,897 new accounts this year. Of these, 196,114 are dial up accounts and 76,968 are broadband accounts. Vargas said that as of 30 June, 64.7% of every 100 Dominicans had a telephone, and of these 54.8% were cell phones.

Politicians challenge dismissals
Members of the three major political parties in the DR, the PRD, PLD and PRSC, have come together to disassociate themselves from the recent dismissals of municipal employees and are asking for the practice to stop, on the grounds that it is illegal. The Secretary Generals of each party, Orlando Jorge Mera, Reinaldo Pared Perez and Victor Gomez Casanova say that the firings violate a municipal governance agreement that was signed by the parties in August 2006. Jorge Mera says that to date 22 dismissals have been confirmed and that some government employees, citing the recently approved bill that limits the power of the Dominican Municipal League (LMD), have begun to prematurely fire municipal employees. Jorge Mera explained that municipal authorities would remain in their posts through 2010. Last week the Chamber of Deputies voted to limit the power of the LMD and convert it into an advisory body.

Cheaper beer
Leading beer manufacturers the Dominican National Brewery (CND) have announced that effective immediately there will be a RD$5.00 reduction in the price of all beers produced by the company. Rafael Menicucci, president of the CND, which produces Presidente and other leading brands, says that the decrease in prices is being introduced to stimulate beer sales, which decreased after the government's last fiscal reform.

Pan-Am Games update
The Dominican Republic continued its successful streak in the Rio de Janeiro Pan-American Games yesterday by defeating Mexico 36-24 in handball. The Dominican team, playing in Group A, has one loss but can still make a medal. Their next opponent is Argentina on Wednesday.
Three homeruns were enough for the Dominican baseball team to beat the Brazilian baseball team 14-2. The Dominican baseball team is the favorite to win the baseball medal.
Surprisingly, the DR women's volleyball team missed its chance of winning a medal after losing to Peru. The Dominican women won the gold medal at the Pan Am Games in 2003.

Diaz faces latest challenge
Dominican open water swimmer Marcos Diaz has received permission from the US Coast Guard to complete his latest challenge. Diaz is training to swim across the Hudson River in New York City in August. Marcos Diaz's technical director Augusto Garcia says that the challenge of crossing the Hudson will have an impact on the Dominican community in New York, which is home to more than one million Dominicans and one of the reasons why Diaz chose this particular site. Skeptics say that Diaz will not be able to complete the crossing in 12 hours. Diaz will head to New York at the end of this week to complete his training for the swim.

July at Casa de Teatro
July is a very active month at Casa de Teatro, the bohemian cafe in the Colonial City. The Jazz Festival continues with a performance by Prisca from Venezuela at 9pm. Audrey Campos in concert is scheduled for 9pm on Friday, 20 July, followed by Marel Alemany on Saturday, also at 9pm. Make your way to Casa de Teatro to purchase tickets for a one-off concert by merengue queen Milly Quezada singing boleros, ballads and bachatas to mark the occasion of Casa de Teatro's 32nd Anniversary. Pavel Nunez follows on Wednesday, at 9pm at Cafe Teatro. Sunday, 29 July sees a Hip Hop Festival starting at 7:30pm at the Sala de Teatro and Cafe Teatro. Tickets are RD$300.
For more upcoming events, see www.dr1.com/calendar
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