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Daily News - Thursday, 06 September 2007

Fernandez struggling?
Frequent trips by President Leonel Fernandez to Santiago and the Cibao region in recent months seem to reflect a growing concern within the government about the President's decreased popularity. Diario Libre comments that Fernandez only has a 22% approval rating in some areas. Some possible reasons for the decline in the President's popularity could be the failure to finish public works projects that were promised or the dismissal of many free trade zone workers. Today Fernandez will make his third visit in as many weeks to Santiago to inaugurate the "Villa Magisterial" and meet with Grupo M, a leading manufacturing conglomerate.

Sticker reduction cleared
President Leonel Fernandez has signed the license plate reduction bill into law, clearing the way for a reduction in license plate renewal stickers. The law now establishes that license plate registration stickers will cost the same as last year. Cars that are five years or older will be subject to a RD$1,200 fee and owners of cars that are five years or newer will be charged RD$2,200. The law also indicates that vehicle owners who renewed their stickers before the law was passed would get the difference in their money refunded. The license plate renewal process had been on hold awaiting the change in the law, and is expected to resume next week.

JCE approves reductions
The Central Electoral Board (JCE) judges have agreed to reduce the cost of 'cedula,' the ID and voting cards issued to Dominicans living abroad. Cedulas will now cost US$15, down from US$35. The cost of obtaining duplicates was also reduced from RD$500 to RD$350. Anyone requesting a cedula for the third time will now pay RD$500, down from RD$1,000.
Also, the JCE agreed to not charge for address changes on the cedula.
The announcement coincides with a scheduled President Fernandez trip to Miami, Boston, Washington, D.C. and NYC this September.

Fiscal reform wasn't necessary
Leading executives of the Association of Industries of the DR (AIRD) have criticized government overspending in violation of the 2007 Austerity Law in an interview with Hoy newspaper. Manuel Diez, president; Ligia Bonetti, vice president and Circe Almanzar, executive director said that increased taxation and spending could bring about an economic crisis. They said that the government should instead of increasing taxes, continue to make tax collections more efficient.
They point out that the government's last fiscal reform wasn't necessary, going by government revenue surpluses so far this year. Diez pointed to the subsequent removal of increases in license plate renewal fees and alcohol and tobacco taxes stipulated in the January 2007 reform. He said that even without those taxes, government revenues are still comfortably over budget.
Circe Almanzar questioned the fact that the government asks the IMF for special dispensations from complying, but has not done so when levying new taxes on the population. She also criticized the lack of accountability in government, which she said only applies in theory but not in practice.
Meanwhile, Bonetti says that politicians should be obliged to reveal their government plans so that the people can then demand their fulfillment once they are elected.

Pablo Amaury Espinal at DICOEX
The Ministry of Industry and Commerce has appointed Pablo Amaury Espinal to head their Foreign Trade and International Trade Treaty Department (DICOEX). Espinal replaces Vilma Arbaje de Contreras who will continue in a technical advisory role. The appointment comes following the designation of Melanio Paredes as the new Minister of Industry and Commerce, replacing Francisco Javier Garcia. Garcia now becomes chief coordinator of President Leonel Fernandez's re-election campaign.

Taiwan donates money
The Ministry of Higher Education, Science and Technology will have more funds for scholarships to needy students. Taiwanese Ambassador Eduardo Chen has handed Higher Education, Science and Technology Minister Ligia Amada Melo a check for US$1 million to be used for student scholarships. Melo added that a portion of the funds would be used to fund the Chinese/Mandarin language program at the UASD University and the Ministry of Foreign Relations. Chen considered the possibility of increasing the funds assigned to the DR for 2008.

Bear Stearns: DR marketperform
In their Central America and Caribbean Monthly Report issued today, Bear Stearns reports that strong growth continues in the DR, driven by the financial services, communications and commerce sectors, and by a healthy upsurge in total exports. The DR's GDP expanded by 7.9% in the first half of the year, and is projected to expand by 6% this year. Bear Stearns forecasts that "given its positive momentum, however, we expect it to grow between 7.5%-8.5%, instead." The brokerage firm rates the DR with B2/B+ and "marketperform".
The brokerage firm mentions that inflation is well contained, coming in at 0.3% in July, the lowest monthly level since October 2006. Nevertheless, Franco Uccelli, analyst for the firm, believes it will be difficult for the country to meet the 4%-6% inflation forecast for 2007 as a whole. "However, we also believe that DR's tight monetary controls will likely keep any deviations from the target relatively small (1% or less)".
The country's external liquidity continues to improve, Bear Stearns points out. "Strong growth in DR's net international reserves, which have escalated by 31% to reach US$2.4 billion so far this year, has noticeably improved its external liquidity position."
Nevertheless, the brokerage firm points out that despite the recent favorable economic results, its external bonds have failed to outperform. "We attribute this to the market perception that the DR has finally left its troubles behind and has graduated to a more mainstream status (by regional standards), becoming one more stable credit that performs well from a fundamental perspective, yet, like its peers, fails to generate greater market interest in its bonds. A caveat to this conclusion, however, is that its bonds continue to afford a premium over those of its closest comps, making them a likely target of yield-hungry investors during relatively peaceful times."

AmCham on El Salvador VP visit
The American Chamber of Commerce has invited El Salvador Vice President to speak on trade and social responsibility in the DR next week. AmCham vice president William Malamud made the announcement yesterday at a press conference.
Also speaking at the conference, El Salvador Ambassador Ernesto Ferreiro explained that Vice President Ana Vilma Albanez de Escobar will visit and attend meetings to strengthen trade and cultural ties between both countries. The ambassador stressed the DR is lagging behind in trade with El Salvador.
Eleven trade missions from El Salvador have come to the DR seeking new business, according to Ambassador Ernesto Ferreiro, but not a single Dominican mission has reciprocated and traveled to El Salvador, as reported in Hoy. According to the Ambassador, El Salvador missions have resulted in deals in tourism, food, pharmaceuticals, metalworks, arts and crafts, and other products and services. Ferreiro explains that not only large businesses have come, but also medium and small sized businesses. He attributed this to the promotion and help that investors receive in El Salvador. Trade is duty free between the DR and El Salvador.
A highlight of the visit of the Vice President will be her talk on the El Salvador free trade experience during an American Chamber of Commerce luncheon on Wednesday, 12 September at the Hotel Jaragua. AmCham vice president William Malamud has highlighted the key role that Albanez de Escobar has played in implementing and making the most of DR-CAFTA for her country. Malamud explains that El Salvador was the first country to sign DR-CAFTA into effect.
AmCham has also coordinated for her to speak the next day in Santiago on the impact social investment has on economic development at a luncheon at the Hotel Gran Almirante.
Interviewed about DR-CAFTA in Hoy, trade and customs consultant Juan Jose Zuniga encouraged Dominican business to make the most of DR-CAFTA . Zuniga added that the government should create the necessary infrastructure and provide better information about the treaty for businesses . Zuniga says that making the most of DR-CAFTA is a task that the government and the business sector should tackle together.

Remittances a big part of GDP
The Dominican Republic is one of the largest recipients of remittances in Latin America and the Caribbean. In recent years, remittances have made up more than 8% of the country's GDP. In 2007 the DR is estimated to receive RD$3 billion, according to Central Bank director Hector Valdez Albizu. Valdez Albizu, quoted in Hoy, added that since 1999, remittances as part of the GDP have grown at a rate of 9%. The Central Bank director added that 80% of Dominican remittances come from the United States.

Controversial Bayahibe port contract
The special commission appointed to study the contract for the construction of a tourism dock in Bayahibe has issued a negative verdict about the company, as reported in Diario Libre. Bayahibe is the main departure port for boats taking tourists on the Saona Island tour.
Before presenting the report, commission president, deputy Eugenio Cedeno Areche (PRD-La Romana) resigned. He said he did so after the proceedings for the questioning of Tourism Minister Felix Jimenez in Congress, "that put me in a prejudicial position to deliver an impartial report." Jimenez is a member of the decisive political committee in the ruling PLD party, and the PLD is majority in Congress.
Tourism Minister Felix Jimenez awarded the controversial dock construction contract in 2005 without holding a tender to a recently established company, Embarcaderos Turisticos del Caribe, a company with no previous experience in ports and a registered capital of RD$50,000. According to the contract, the company commits to investing US$2.5 million to build a modern port in Bayahibe.
According to information provided by the Technical Office for Legislature Reviews, Embarcaderos Turisticos del Caribe is a subsidiary of another company, Belmont Investment, S.A. about which the report states legislators have little information, except that it is headed by Francisco Armando Rodriguez Castro. The legislature report states that Rodriguez Castro assumes no role or obligation, even though he heads Embarcaderos in representation of Belmont, neither of which has any commitments with the state.
Nevertheless, the state is obliged to take on multiple responsibilities such as delivering the land where the project will be developed as well as the area for the infrastructure construction; to facilitate permits and authorizations, and to coordinate the social relationship between the company and the communities that may be affected by the port construction. The contract also obliges service provision by the Tourism Police and the Navy in regulating and controlling security and access to the area and prohibiting commercial boat trips from embarking and disembarking.
The legislature report also found that on the board of Embarcaderos Turisticos, Rodriguez Castro will also represent A.R. Inmobiliaria, a real estate company, in the rental, purchase, sale and mortgage of properties.
The contract, signed by the Minister of Tourism on 5 December 2005 in representation of the Dominican state, stipulates the concession for the Bayahibe property would last 20 years.

Human Rights want investigation
The National Human Rights Commission has asked Attorney General Radhames Jimenez to order an investigation into an incident where three unarmed prisoners were shot and killed at the jail in Moca. Officials claim that the prisoners were attempting to break out of the jail. The head of the human rights organization, Manuel Maria Mercedes, told Diario Libre that officials could have used another method to control the prisoners instead of shooting them. Mercedes added that human rights groups in the DR are concerned that the officers who committed the shootings were "trigger happy."

Mattel recall affects DR
For the third time this year Mattel Inc. has recalled toys that were made in China following fears that the toys contain lead and could be harmful to children. Listin Diario reports that as a result, the company has announced that seven Barbie doll accessories will be removed from Dominican toy-store shelves. Mattel says that the Barbie dolls themselves are not affected by the recall. In recent months, 719 toys have been affected by the growing concern about the safety of Chinese-made toys. The USA's largest toy manufacturer has taken a huge hit with the continuous recalls but Dominican officials have been efficient in collecting all recalled toys and no case of lead poisoning as a result of the toys has been reported in the DR.

Drug officials face challenges
Dominican drug officials are facing increased challenges in the fight against drugs as consumption in the country increases due to falling prices. The situation is causing great concern and National Drug Council president Mabel Feliz is acknowledging an increase in "micro-trafficking," especially in the country's poorer barrios. Diario Libre writes that the decrease in price has increased temptations for drug users. Street prices vary depending on quality and area, but on the streets of the DR a small rock of "crack," a chemical derivative of cocaine, costs between RD$60 and RD$90, a small baggie of heroin costs RD$500, a gram of cocaine costs between RD$200 and RD$300, a "dime" bag of marijuana costs between RD$25 and RD$50, and a small bag of ecstasy costs between RD$300 and RD$700. According to Diario Libre, a kilo of cocaine costs RD$260,000, a kilo of heroin US$40,000, 1 pound of marijuana RD$20,000 and 1 ounce of marijuana RD$2,000.

Reckless driver gives himself up
Julio Antonio Dominguez has turned himself in to the police a day after reportedly killing 36-year old bus passenger Antonia Castro. He had fled after the accident. Fellow passengers reported that the bus driver was racing another Fenatrano bus along the San Martin Avenue route from Villa Mella to Santo Domingo city center. His reckless driving led him to cross a red light, and then crashed into a car, finally coming to a halt at a lamppost. Dominguez turned himself in accompanied by transport union leaders Juan Hubieres and Antonio Marte. On Tuesday the deceased woman was on her way to work from her home in Villa Mella, and was thrown from the public commuter bus and died instantly of severe head injuries at 6:30am. The accident took place at the corner of San Martin and Ortega y Gasset Avenues. The woman had just boarded the bus and had not had time to take her seat when the crash occurred.

Carrying sacks to running marathons
Most marathon runners train by running long distances, but Bernardo Martinez says that carrying large sacks at a warehouse in the Villa Maria area of Santo Domingo has trained him to run a 40-kilometer marathon in the German capital Berlin on 29 September. Martinez, who is being sponsored by the Ministry of Interior and Police, was chosen following his performance during the 30-kilometer race at the Mirador Sur Park, where he clocked in at 2 hours and 37 minutes. Martinez says that he has always wanted to participate more actively in sports but his responsibilities haven't allowed him to do so. He says that 15 years in his warehouse job have prepared his muscles for the competition.

Win in Pan Am master swimming
Danilo Vicioso and Mercedes Aybar captured high point trophies in the 40-44 and 35-39 age group respectively at the recently held II Pan-American Master Swimming Championships in San Juan, Puerto Rico. The pair were part of the 11-swimmer strong Dominican team that competed at the swim meet from 30 August to 4 September. Vicioso, who is ranked 7th in the world by FINA, the world's governing swimming body, in the 200 meter butterfly, won 4 gold and one silver and set Pan Am master records in the 100 and 200 meter butterfly events.
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