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Daily News - Monday, 22 October 2007

President looks at energy plan today
President Leonel Fernandez is holding a meeting with his energy team this morning to analyze the proposed Energy Contingency Plan drawn up by the Ministry of Industry and Commerce. The plan includes fuel saving suggestions, changes in working hours, better traffic light coordination and a possible modification of the Hydrocarbon Law. The latter is one of the key issues that sparked national protests in July and early this month. The President is expected to announce just which measures will be put into place. In 2005 there were similar calls of fuel savings and many steps were announced, but few, if any, were ever fully enforced. With petroleum prices at an all-time high, the government is in a position where it is forced to ensure that these new measures are really put into practice.

Unprecedented fuel price hikes
The Ministry of Industry and Commerce has authorized price increases of RD$8.60 and RD$7.90 for a gallon of premium and regular gasoline last Friday night. Diesel went up a whopping RD$7.30 a gallon and propane gas (LPG) went up RD$0.56 per gallon. Dominican fuel prices are indexed to the price of West Texas Intermediate, which hit prices of over US$88 a barrel last week, over fears of interruption of oil supplies due to tensions between Turkey and Iraq.

More than patches for industry
The spokesman for the Association of Industries of Herrera, Jesus Moreno told reporters that the Dominican Republic industrial sector needs more than "quick fixes" or patches in order to survive in the new world order. While Moreno praised the Energy Contingency Plan to be announced by the government, he also expressed concern about finding the dollars needed to pay for the oil. He said that, "the Dominican Republic cannot continue to depend on foreign investment to sustain the economy". Taking a closer look at exports, Moreno explained that if mined exports were to be excluded from the statistics, net Dominican exports would be a negative US$74 million over the past eight months. The business leader called for increased job creation initiatives and a push for lower operating costs for local industry.

Two new telecoms in the DR
Two new telecommunications companies, ETGETEL and OneMax are now operating in the Dominican Republic. Etgetel will specialize in television, telephone and Internet broadband service in the poorer parts of the country, and is expected to start up next month. The announcement was made in Los Botados, in Yamasa, north of Santo Domingo, in Monte Plata province. The director of the Dominican Telecommunications Institute (INDOTEL), Jose Rafael Vargas, announced the arrival of OneMax (Wi Max technology), which will offer the latest in hi-tech communications for the country's major urban areas.

More issues between HMOs and SFS
The differences between the Health Management Organizations (HMOs in English and ARS in Spanish) and the National Family Health Insurance Program (SFS) continue to multiply. The most recent comments by the head of the National Social Security Council (CNSS) accused the HMOs of blocking the system, "and therefore, the best thing would be for all of them to remain outside (the SFS)". Jose Ramon Fadul also said that the ARS/HMOs would have to return RD$253 million that they had collected on policies. The sum represents 18% of the premiums that are intended for preventative health care. Jose Cruz Pichardo, an official of the HMO association (ADARS), told Lisania Batista from Diario Libre that without the HMOs the system would not work since there wouldn't be anybody to administer the claims. He said that the call to eliminate the HMOs is just an attempt to convert the whole system into a state-run health program.

Decision on BanInter case
The three-judge panel, made up of Santiago Sanchez, Esmirna Mendez and Pilar Rufino, has issued its decision in the case involving the high-ranking executives of the Banco Intercontinental (Baninter). The verdict was guilty for two of the accused, Ramon Baez Figueroa and Luis Alvarez Renta, but not guilty for their associates Vivian Lubrano de Castillo and Jesus Maria Troncoso. The magistrates ordered the two guilty parties to serve 10-year jail sentences and the payment of RD$63 billion in damages and fees for violation of Monetary and Financial Law 83-02. Ramon Baez Figueroa was acquitted of charges of asset laundering, unlike Alvarez Renta, who had been accused of being an accomplice in asset laundering in the case. The reading of the sentence took over five hours. As part of the sentence, the judges ordered the sale of a series of radio stations, television channels, aircraft, a villa at Casa de Campo and vehicles, and for the defendants to pay the legal costs. The lawyers for the convicted bankers have said that they will appeal the sentences. They have 20 days to appeal.
The banking story is being carried in the business press abroad.
See http://www.forbes.com/feeds/ap/2007/10/21/ap4243367.html

Comments on the verdict
The editor of Diario Libre, lawyer and historian Adriano Miguel Tejada, commented that the guilty verdict has served the Dominican judicial system's best interests. While admitting that the verdict would surely be appealed not only by the defense lawyers, but also by the Office for the Prevention of Corruption (now called DPCA), the editor praised the organization and order with which the sentence was pronounced. According to Tejada, in the final analysis the most important thing is that the judicial institutions get good marks from the public and that the system proves that it works. The editor concludes that the sentence lowers the stress levels that were evident in local society, although there is a lot of interest in the authorities' failure to pursue politicians, as in the PEME case.
El Caribe newspaper carries comments by lawyer Ramon Antonio Veras (Negro) who called the verdict "a gift for impunity and a stimulus for white collar crime to continue in the country."

Against PEME decision
The decision taken by the District Attorney for the National District, Jose Hernandez, not to pursue the case against the principal official in the Program for Minimal Employment (PEME), created during the first Fernandez administration (1996-2000), was strongly criticized by the head of the Office for Prevention of Corruption (DPCA), Otoniel Bonilla, and the head of the Broad Front for Popular Struggle (FALPO), Fidel Santana. Santana said that the decision not to continue the case was proof that impunity for public officials is part of the Fernandez administration. The PEME case concerned over a billion pesos in funds that was intended for use in employing gang members in order to reduce crime in many of the more populous barrios of Santo Domingo. Serious administrative errors were alleged in the process of the disbursement of the funds. Orlando Jorge Mera, the general secretary of the PRD, told Listin Diario reporter Elias Ruiz Matuk that the decision to drop the case was "proof of the government's lack of willpower" in fighting corruption. In his statement, Bonilla said that "what starts poorly, ends poorly," and he added that the case started with many difficulties and turned into a pamphleteering war rather than a corruption case.

Plot thickens in Sun Land case
New documents have turned up in the Sun Land case, but they only serve to confuse matters even further. According to Diario Libre, a letter from the subcontractors of the construction projects at the Autonomous University of Santo Domingo (UASD) to Felix Bautista, the head of the Office of Supervising Engineers of State Public Works (OISOE) reveals that the contractors offered to finance the construction. The letter is dated 10 July 2007. According to the proposal, the contractors would finish the projects within 12 months, with no payments to be made by the government. The subcontractors said that the promissory notes currently in the hands of the HSBC Bank USA are sufficient guarantee of payment. What, according to Diario Libre, really stands out is the fact that the proposal is dated just three months ago, not over a year ago when the notes were signed by Bautista. The letter also mentions a total budget of RD$3,057,397,673.16. Nevertheless, in paid adverts in the local press, Delgado Malagon, the supervising engineer for the projects, published a figure of US$112,267,713, which at an exchange rate of RD$33.50 per dollar is equal to RD$3,760,968,385.50, a number impressively higher than the contractor's figure. Another item that raised eyebrows was the legal fees, which were estimated to total almost 40% of the total contract. Furthermore, the five public works that were to be built with the funds contrast with the 11 public works listed in the contract signed with Sun Land.
Diario Libre also points to the RD$924 million that was to be allotted to pay for legal and banking fees, plus interest for borrowing RD$2.07 million. Furthermore, the government was to make another RD$900 million available to pay for complementary works and for equipping them. Diario Libre points out that the original contract with Sun Land had covered all costs.
Diario Libre adds that OISOE director, Felix Bautista has not been available for questioning by the press.

The dunes controversy continues
Researchers from the Ministry of the Environment have been able to ascertain that the lands leased by to the Ciramar group the municipality of Bani are, indeed, part of the land covered under the Protected Areas law, as reported in the Listin Diario. The purchase contract was authorized by a presidential decree.
The technicians were accompanied by members of the Senate Environment and Natural Resources Commission. Commission president Ruben Dario Cruz headed the junket. The lands in question, some 56,000 square meters, were to be rented to Ciramar supposedly for use as a ship repair depot, but some local people claimed that the idea was to convert the region into a shipyard for dismantling old vessels. As a result of the visit by the Senate commission and the map work by the technicians, the local mayor, Camilo Landestoy announced that the Ciramar contract would be rescinded forthwith.
Nevertheless, Ciramar publishes an advertisement today denying the Ministry of Environment determined the lands were Protected Areas.
In 2005, Listin Diario reported that fraud against the Dominican state had been detected by the General Accounting Department in a contract for the repair and operation of the same naval shipyard. The Accounting Department found that there had been criminal responsibility on the part of representatives of Ciramar S.A., Ciramar International Trading, Co. Ltd. and Anabalca. At the time, it ordered the Armed Forces Ministry to cancel the contract signed by the state and the three companies with immediate effect.

UN to look at racism in the DR
Two special United Nations envoys will look at racism in the Dominican Republic over the next week, invited by local authorities. The Office of the UN High Commissioner for Human Rights announced the visit in a press release from Geneva. One of the officials, Doudou Diene, is a special reporter in the fight against racism, xenophobia and intolerance. The other officer, Gay McDougall, specializes in minority questions. The team will try to obtain first-hand information on issues of racial discrimination, xenophobia and intolerance during visits to Dajabon, Santiago and San Pedro de Macoris. They will also interview legislative and judicial figures as well as NGO leaders. Last March, Amnesty International denounced what they described as "deep-rooted racial discrimination" in the Dominican Republic, specifically against people of Haitian descent and called on local authorities to stop mass repatriations. Close to one million Haitians, most of them illegal migrants, live in the Dominican Republic.

PLD halts cash for posters
The PLD party's national campaign committee has called a halt to the RD$1000 gifts to drivers who put PLD posters on their vehicles. A report in the Diario Libre revealed the new publicity stunt last weekend after looking into a traffic tie-up on one of the main thoroughfares of Santo Domingo. Drivers were lining up to get the RD$1000 pesos and placing a large, transparent decal on their rear windows. There was a promise of RD$1000 per month until the May 2008 elections. In Santo Domingo and Santiago, hundreds of vehicle owners lined up to get the easy cash. According to a press release from PLD headquarters, "the party is suspending the operation because it is not necessary to pay anyone to display a PLD poster." The party's campaign committee also said that the whole thing did not come from the party itself, but was most likely thought up by businesspeople linked to the party.
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