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Daily News - Tuesday, 28 August 2007

Fernandez makes more moves
President Leonel Fernandez has designated Major General Daysi Liriano Paulino as director of the auxiliary police, while Colonel Jose Ignacio Sandoval Cabrera was appointed to the post of director of the National Prisons Department. Sandoval replaces Juan Ramon de la Cruz Martinez, who was not reassigned to another post. General Franklin Vittini Duran was appointed as new director of the Police Social Security (ISSPOL) and Colonel Bolivar Pacheco Santana as governor of the Presidential Palace.

DGII refunding RD$40 million
The Tax Department (DGII) will return RD$40 million to vehicle owners who renewed their license plates before President Leonel Fernandez suspended this year's fee increase. Listin Diario explains that vehicle owners who have already paid for the renewal will receive checks that can be cashed ten days after Congress passes the bill. President Fernandez instructed the DGII to revert to last year's fees.
Senate president Reinaldo Pared Perez said that the bill to maintain license plate renewals at last year's rates would be ready today, at 3pm.
Costs for renewing plates are now RD$1,200 for cars five years or older, and RD$2,200 for cars five years or newer. The renovation process is on hold pending the modification of the bill.
Last week President Fernandez reversed the increased taxation on vehicles, on the grounds that the successful implementation of several new taxes as of January 2007 has made it unnecessary.

Cocco is after millions, not pennies
Customs director Miguel Coco says that the Customs Department (DGA) will not prosecute small business operators suspected of selling fake designer merchandise. As reported in El Dia, he said that DGA policy is "to go after the millions and then the pennies." He said their focus is on the freight containers, not small stores. He made his comments after a TV program revealed that the wife of a Customs deputy director, Luis Sanchez, was selling fake designer bags, perfumes and other products in her store. He defended his employee, saying that he has had an exemplary career. He said that the prosecution of those cases is the responsibility of the National Copyright Office, as well as Customs. Cocco was speaking after a ceremony during which he handed a compilation of Customs legislation to the Supreme Court president.

UASD opens day care center
Santo Domingo's UASD University has opened a day care center on campus that will provide students who are mothers with the option of continuing their studies while leaving their children in safe hands. The center cost RD$12 million and was inaugurated in May. The center has a capacity for 200 children between the ages of three months and six years. Zoraida de Leon, director of the center, said that services are free for students and the center will be open from 7am to 7pm. Children at the center will have the opportunity to play educational games and the workers who will care for the children are trained in social work, psychology and education. De Leon says that a similar center will be built at the UASD campus in Santiago (CURSA).

Aquarium temporarily closed
The National Aquarium is being closed temporarily in order to repair the damage caused by Hurricane Dean. The aquarium will be closed for 15 days and Aquarium director Enrique Pugibet says that the repairs will cost RD$2 million. The aquarium suffered some structural damage, but Pugibet said that the aquarium's emergency plan worked and that no animals were lost during the hurricane. Omar Ramirez, the recently appointed Minister of Environment and Natural Resources, has given the aquarium RD$1 million towards the restoration process.

1,600 MW in renewable energy
Investment opportunities valued at US$2 billion are awaiting the implementation of the Renewable Energy Investment and Incentives law, which is being prepared by the National Commission of Energy (CNE). Alternative energy projects aimed at providing an additional 1,600 MW of energy are planned for the DR. Aristides Fernandez Zucco, president of the National Energy Council, says that the rulings should be ready by mid-September. Fernandez Zucco, quoted in Listin Diario, said that by the end of the year construction of solar and wind power projects would begin to provide 600 MW of energy for the Dominican grid. These 600 MW will save the country US$400 million per year. Fernandez Zucco says that by next year further installations aimed at providing another 1,000 MW will begin construction.
Fernandez Zucco also pointed out that the DR has the potential of producing 10,000 MW in wind energy and that in 15 years the country could generate 20% of its energy from alternative or renewable sources.
He was speaking during a Workshop on Alternative Energy Planning, organized by the Ministry of Environment and the National Energy Commission (CNE).

Reducing public debt a challenge
International Monetary Fund country resident representative Erik C. Offerdal has said that the short term challenge for the DR is to maintain fiscal discipline in order to help reduce the burden that the public debt has on the economy, so as to reduce external vulnerabilities.
Offerdal added that, as determined in the IMF Stand-by Arrangement with the country, the public debt should become 30% of the GDP within a 10-year period. The public debt is currently at 45% of the GDP. Offerdal says that reducing the public debt will require a continued effort to reduce public sector subsidies to the electricity sector. He spoke of the importance of the electricity sector becoming self-sufficient.
He also commented on progress made by the State-Run Electricity Companies (CDEEE) in renegotiating contracts with generating companies, renegotiating the Madrid Accord contracts and reducing the distribution companies' financial losses.
Offerdal says that the volatility of international financial markets will not affect the DR and says that if there is an effect it will be minimal. He continued by saying that a lesson the DR should take from international market vulnerability is that it should reduce its debt.
He said that he expects the IMF to approve the most recent letter of intention sent by the government authorities. With the approval by the IMF board, the country would receive US$228 million this year.

Business sector wants IMF
Lisandro Macarrulla, president of the National Council for Private Business (CONEP) and Rafael Menicucci, chief executive of Cerveceria Nacional Dominicana that brews Presidente beer, are both in favor of the country signing an agreement with the IMF once the current Stand-by arrangement comes to an end in January 2008. Both businessmen believe that the IMF's presence will generate economic confidence in terms of both investment and finance. Macarrulla added that this wasn't a case of loss of confidence in the local authorities. In his opinion, an IMF agreement is a welcome sign of stability on the international finance markets. Menicucci also commented that the IMF would help the government manage resources and state funds. The businessmen's statements come in response to comments by members of the government's economic team. Temistocles Montas and Vicente Bengoa both said that the government has been the reason for economic stability, not the IMF, and that there is no need to sign another agreement with the IMF. Bengoa, however, said that only President Leonel Fernandez could decide whether or not to sign an agreement with the IMF.

The finals of the Baninter case
The case of the state against the former owners and managers of the Banco Intercontinental (Baninter) is coming to an end. For the public to follow, Channels 7 (Antena Latina) and 21 will be transmitting the court conclusions of the leading bank collapse that shook the Dominican economy in 2003. Journalist Alicia Ortega will be in charge of the TV special coverage on the 2003 bank fraud case. The defense lawyers have based their case on the claim that processes that led to the fraud were generally accepted as common practice in the Dominican financial system. The accused - Ramon Baez Figueroa, Vivian Lubrano de Castillo, Marcos Baez Cocco, Jesus Maria Troncoso Ferrua and Luis Alvarez Renta are on trial. On 13 May 2003 the Dominican Central Bank reported irregular or fraudulent Baninter operations worth more than RD$55 billion, or about US$2 billion. The bank collapse has cost taxpayers more than RD$74 billion, and led to the intervention of the IMF, according to a report in Clave Digital.
Meanwhile, IMF resident representative Erik C. Offerdal spoke about the conclusions of the case and said he hoped that penalties are levied on those responsible for what he describes as a very serious case, with serious consequences for banking and for the country. "What is important is that the facts are there, it is a bank fraud, and the judicial system has the independence and capacity to levy penalties at the level of the seriousness of the case", he said, as reported in Hoy. He said that the IMF position is that when there is bank fraud, those found responsible need to be punished.
Offerdal stated their position in a 10 May 2006 statement on occasion of the review of the stand by arrangement: "...Criminal proceedings against former owners of those banks involved in the 2003 banking crisis should send a strong signal regarding the consequences of misconduct, and it will be important to ensure the proceedings are sufficiently comprehensive to include all concerned officials."
The World Bank has also addressed the issue, with a statement on their web site:
http://web.worldbank.org/WBSITE/EXTERNAL/BANCOMUNDIAL/...

Corruption as bad as drug trafficking
Supreme Court President Jorge Subero Isa says that corruption is just as bad as drug trafficking, adding that people who are carrying out public functions should not be getting rich. He says that any public official who wants to make money should find another job. Subero says that corruption is not endemic to the DR and says that it has been developing recent years because of bad examples set by public officials. Quoted in Listin Diario, Subero said that corruption is just as harmful to the DR as drug trafficking.

"Quita Tenis" gets seven years
Samuel Rosario a.k.a. "Luis Quita Tenis" was sentenced to seven years in jail after being found guilty of smuggling 10.84 grams of cocaine in September 2006. "Quita Tenis" will be sent to La Victoria prison and has been order to pay a fine of RD$50,000. Prosecutors had originally asked for 20 years.

Felix Sanchez wins silver
Dominican runner Felix Sanchez has won the silver at the 400 meters hurdles finals of the Track World Championships in Osaka, Japan. Sanchez's win seems to indicate that the runner is almost fully recovered from the injury that kept him sidelined for most of 2006. In Sanchez's last international competitions, at this year's Pan American Games, he did well and would have won gold had he not clipped the final hurdle.
 
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