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Everything is ready for XII Ibero-American Summit Saturday, 16 November is the scheduled opening date of the XII Iberoamerican Summit, where leaders from the Caribbean, South and Central America, Spain and Portugal will address an agenda that includes poverty, health issues such as AIDS and TB, and social and economic inequality. Other items, such as migration, human rights and environmental concerns will also be included. The President of Peru, Alejandro Toledo, will be the only head of government not present from the Ibero American countries. King Juan Carlos of Spain will chair the talks and will introduce Spain’s proposal to suggest changes in the current system of summit meetings. |
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Release of results on Pepegate probe delayed Diario Libre says that there is a profound silence surrounding the “Pepegate” fraud and corruption case. The hush that has surrounded the case since its inception is such that no reason was given for the absence of the final report, which was supposed to be handed over to the President as of 5 pm on Monday. Some sources, not yet verifiable, say that the chief of the Armed Forces, General Jose Miguel Soto Jimenez, submitted the report to the President at his residence early in the morning. The Solicitor General for the Dominican Republic, Virgilio Bello Rosa, told the press that the jurisdiction of the case will depend on whether the bank that was affected by the case lays charges. If this were so, then the case would be tried in the civilian courts, rather than in the military tribunals. The El Caribe headline reports on comments made by Cardinal Nicolas Lopez Rodriguez, who described the Pepegate incident as a national embarrassment, given Goico’s close ties to the President. Goico was the chief of security for the President and is under investigation for major credit card fraud and irregularities pertaining to the illegitimate use of airplanes and a helicopter exclusively designated for the presidential advance team. |
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Pepegate airplane detail corrections The presidential advance team airplane confiscated by the Armed Forces is a British Aerospace Jetstream turboprop, not to be confused with the Gulf Jetstream name. The Caribair airplane in question is another turbopropeller. It was confiscated at the executive airport of Fort Lauderdale (FXE) and not in Miami. |
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Major Constitutional reform? The efforts of Senator Cesar Augusto Matias to change 27 articles of the Constitution seem to be gaining strength in spite of strong outside opposition. 22 senators have signed on to back the proposal for constitutional reforms. Among the articles to be amended are those that deal with extending the presidential term to 5 years, the stability of the Supreme Court judges, parliamentary immunity for deputies and senators, and the 50%+1 majority needed to elect the President (for a 45% plurality and 10% margin over opponents to win the election). Also included are the Public Defender’s position and a new political division of the National District (Santo Domingo). Cardinal Lopez Rodriguez asked the legislators to respect the Constitution and to put an end to this “joke”. He asked that if a reform be necessary that a group of people specialized in constitutional law be formally convened, instead of resolving matters with mere political deals. |
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Preferential sugar quota a must The Dominican ambassador to the United States, Hugo Guiliani Cury, told reporters that if the issue of sugar is included in the negotiations of the Latin America Free Trade Agreement (FTAA), the Dominican Republic would find itself in a difficult position. At the same time, Guiliani Cury argued for the need to obtain a bilateral free trade agreement with the United States, and in so doing avoid the dangers that both Brazil and Guatemala represent to the maintenance of the preferential quota now in place. Ambassador Guiliani insisted that both the government and the private sector must defend the interests of the Dominican Republic. “…If Brazil takes this issue (of sugar quotas) to the negotiating table, the Dominican Republic can forget about its preferential quota…” said Guiliani Cury, as he spoke at a luncheon sponsored by Hoy newspaper. Also discussed at the luncheon meeting were the World Trade Organization, the Free Trade Agreement of the Americas and the “probable” bilateral trade agreement with the United States. |
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Telephones and taxes The head of the Dominican Association of Importer Warehouses (ASODAI) called the proposed change to the taxation paid by the telephone companies “an absurdity.” The lead article in the Economy section of Hoy newspaper says that the telephone companies pay a “canon”, or royalty fee, of 10% of their gross income. The proposal would rescind this fee in favor of the companies entering the regular taxation system, where taxes are levied on net income. Most experts feel that the resulting income generated would be much less than what the government now receives. Domingo Espinal, the head of ASODAI, commented on the contradiction of the tax reduction for a vigorous industry at a time when it has been increasing taxes to other sectors that are barely surviving. |
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Government “errors and omissions” The government account named “errors and omissions in the balance of payments” shot up US$567.8-million during the first half of the year. This accounting phenomenon has economists pulling their hair, as the situation does not allow them to balance the country’s accounts. Like many things that are not regularly seen by the public, this case reveals the weaknesses and deficiency of public accounting of the external sector of the Dominican economy. According to Mario Mendez, editor of the economic section of Hoy newspaper, the account for errors and omissions should have a minimum value, given that the accounts of the external sector should appear only in two columns - one for credits and one for debits. However, the ongoing negotiations and differing rates of disbursements render this system impractical, necessitating an account for errors and omissions. Nonetheless, the figure of US$567.8-million dollars has surprised a lot of people, since the amount represents 2.5% of the Gross Domestic Product (GDP) and is larger than the deficit in the balance of payments for the same period of US$309.3-million dollars. One economist said, “In that much money you can hide anything.” Several interpretations have been given on the huge account, ranging from the multiple loan transactions that are financed with unclear resources, to simply the registration of large flows of hard currency. Some people see humor in the accounting solution, calling the account “(h)orrors and omissions.” |
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Future of Business in the Americas The “A” list of speakers was present in Santo Domingo for the conference on the Future of Business in the Americas 2002, held at the Hotel Jaragua. The speakers included William Gambrel, president of the Association of American Chambers of Commerce, David Hirschmann, senior vice president of the US Chamber of Commerce, Congressman Charles Rangel and Thomas Shannon, the US Deputy Secretary of State for Central America and the Caribbean. Tom Shannon’s main idea was that, although the area is not currently making headlines in the Washington Post, the United States is indeed working with Latin America. He emphasized that the United States is committed to the Free Trade Agreement of the Americas and will continue to hammer out the details, in spite of difficulties. For his part, Charlie Rangel urged the different countries of the region to work together and prepare a powerful and united block within the FTAA. Representative Rangel pressed for the countries to get their own people to back these initiatives. As one of the principal speakers at the conference, Rangel pointed out that a positive atmosphere was needed to achieve new sources of employment and training in areas that had lost the capacity to compete in the world market. For more information on the conference, see http://www.amcham.org.do |
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Power in DR is the most expensive in the region Antonio Pantoja, executive vice president of Edesur and Edenorte, admitted in an interview with Hoy newspaper last week (7 November) that power service in the Dominican Republic for those with consumption of over 1,000 kWh is the most expensive in Latin America. Nevertheless, he said that those consuming 50 kWh pay the lowest rates in the region. According to Pantoja, the Superintendence of Power is responsible for setting the prices of electricity consumption - not the power companies themselves. Pantoja said the Union Fenosa affiliate companies have paid RD$111-million in taxes to the government and that the company contributed US$212-million during the capitalization process. Of this amount, 70% was used to pay for the purchase of power, or US$149.4-million (previous years show figures of US$23-million for 1999 and US$126.4-million for the year 2000). Only 10.4% of the total amount was invested in improvements to the service. Pantoja also said that the capitalization process did not require the companies to make investments. Their books show that investments in assets were recorded at US$22-million. Previous years show figures of US$6.9-million for similar investments in 1999 and US$15.2-million for the year 2000. The financial report drafted by Edenorte and Edesur shows that the company used US$8.2-million to make severance payments to employees of the Dominican Electricity Corporation (the state electricity utility), US$15-million to pay CDE past debt, US$11-million to pay a CDE loan, US$529,000 to pay Salomon Smith Barney, US$4.2-million was registered as an administration fee, US$1.05 million to incorporate the companies and US$200,000 in commissions to the CREP, the governmental agency that supervised the capitalization process. Regardless, he said they have invested US$180-million in the country up to date and that the company has a high satisfaction rate among its clients, mentioning that only 0.6% of their clients have placed claims. Pantoja feels this shows that most of their clients are satisfied with the service that Edenorte and Edesur provide. He justified the massive power increases by explaining that the rates had not gone up since February 2000, despite the rate of inflation, devaluation of the peso and the increases in the price of petroleum on world markets. |
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High cost of power shuts off Columbus Lighthouse Diario Libre reports that the light show of the Columbus Lighthouse has not been seen for many weeks due to its high cost of operation. General administrator Luis Valdez Yaport says that operating the laser beam for only 2 hours costs RD$50,0000 and by not running the weekend show they have reduced their power bills from RD$900,000 to RD$180,000 a month. He also explained that they do not turn on the beams so as not to offend residents of the nearby ghettos subject to long hours of blackouts. The newspaper also mentioned the poor maintenance given to the monument now that it is no longer under a private board. The monument is now under the Ministry of Culture department. |
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Trade with Brazil is US$210 million A Brazilian public and private sector trade mission that recently visited the DR hopes to entice the Dominican Republic into producing alcohol for fuel purposes in the near future. The trade mission says Brazil hopes to resume its production of ethanol now that sugar prices are low and petroleum prices high. In the 80s, Brazil was a major producer of the fuel. The mission highlighted the fact that trade between the Dominican Republic and Brazil is on the rise, with current annual business valued at US$210-million - up from US$70-million four years ago. |
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Future of Business in the Americas The “A” list of speakers was present in Santo Domingo for the conference on the Future of Business in the Americas 2002, held at the Hotel Jaragua. The speakers included William Gambrel, president of the Association of American Chambers of Commerce, David Hirschmann, senior vice president of the US Chamber of Commerce, Congressman Charles Rangel and Thomas Shannon, the US Deputy Secretary of State for Central America and the Caribbean. Tom Shannon’s main idea was that, although the area is not currently making headlines in the Washington Post, the United States is indeed working with Latin America. He emphasized that the United States is committed to the Free Trade Agreement of the Americas and will continue to hammer out the details, in spite of difficulties. For his part, Charlie Rangel urged the different countries of the region to work together and prepare a powerful and united block within the FTAA. Representative Rangel pressed for the countries to get their own people to back these initiatives. As one of the principal speakers at the conference, Rangel pointed out that a positive atmosphere was needed to achieve new sources of employment and training in areas that had lost the capacity to compete in the world market. For more information on the conference, see http://www.amcham.org.do |
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Need to convince Bush to come for a holiday Dominican Ambassador in Washington, D.C. Hugo Guiliani and his predecessor, Roberto Saladin, question why the United States has given priority to Central America in the bilateral trade talks negotiations over the Dominican Republic. Speaking at the Future of Business in the Americas 2002 conference, Saladin highlighted that the DR has been the Caribbean country to take the greatest advantage of the Caribbean Basin Initiative. The DR is also the second largest trade partner with Florida and the fifth largest trading partner of the United States. Manuel Rocha, a former charge d’affair of the US Embassy in the DR and former US ambassador to Argentina and Bolivia, understands the Dominican frustration. But he says things can change. He points out that as more US tourists are coming to the DR and that the country has successfully persuaded Charles Rangel and former President Bill Clinton to invest and vacation in the DR, the country now needs to work on getting President George Bush to visit. Rocha forecast that, with the interests coming into play in favor of Central America, it is possible for the region to sign a bilateral trade agreement with the US, even ahead of Chile, which is next in line. On the other hand, William H. Lash III, Deputy Assistant Secretary of Commerce for Complaints and Compliances commented that the DR needs to fix matters on governance, ethics, trade interference, procedures to facilitate commerce, procurement and transparency to advance on trade talks. Trade facilitation index the Dominican Republic ranks low, especially because of customs and non-trade barriers. He said that Central America has improved a lot lately to the middle level bracket of the index. |
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Days of Cuban embargo numbered During his comments on the outlook for a FTAA after the US congressional election, while at the Future of Business in the Americas 2002 conference, former US ambassador to the Dominican Republic Charles Manatt forecast the end of the US trade embargo in Cuba. Manatt predicts the end of the embargo at the start of the next presidential term in the United States. He explained that Jeb Bush no longer needs the support of Cuban-Americans, now that he has been re-elected as governor of Florida. Furthermore, he said that the internal political realities will have changed even more after the 2004 presidential election. Manatt said that the ban on trade is “a wrong policy” and that whoever wins the presidential election in 2004 would lift the embargo. He mentioned the many and varied kinds of missions from the United States that are traveling to Cuba these days to subtly pave the way for the opening of trade. The Dominican government maintains a policy of trade cooperation with Cuba and the Office of Promotion of Investment (OPI-DR) recently promoted the visit of Dominican businessmen to Cuba to begin talks for alliances to also get a foot in the door. |
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Dominican-American actor slain 26 year-old Dominican-American actor Merlin Santana was shot and killed in Los Angeles on Sunday. Born in New York of Dominican parents, he was a regular on the Steve Harvey Show and appeared alongside Eddie Murphy this year in a film produced by Showtime. Santana is also fondly remembered for his childhood role of Stanley on the Cosby Show. He was assassinated while sitting in a parked car at around 2:30 am, according to police reports. The motive for his murder is unknown. |
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Miguel Tejada is AL Most Valuable Player Miguel Tejada was named the American League’s Most Valuable Player. The Dominican shortstop is credited with having lead the Oakland Athletics to a third straight postseason. Tejada competed with fellow Dominicans Texas Rangers Alex Rodriguez and New York Yankees Alfonso Soriano for the coveted award. See http://mlb.mlb.com/NASApp/mlb/mlb/homepage/mlb_homepage.jsp |
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Baseball Standings Aguilas Cibaeñas 14 5 Estrellas Orientales 11 8 Tigueres de Licey 9 10 Leones de Escogido 8 11 Azucareros del Este 8 11 Gigantes del Cibao 7 12 Today’s games: Santo Domingo: Estrella vs. Licey San Francisco de Macorís: Escogido vs. Gigantes La Romana: Aguilas vs. Azucareros |
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