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Daily News - 20 November 2002

Pass Potable Water Bill now!
The European Commission is worried that congressional delays in passing the General Bill on the Reform of the Potable Water Sector and the General Water Bill are putting at risk a European Union grant of $53-million Euros for the water sector. The assistance agreement signed in June 2002, was conditioned on the ratification of the bills. 
In a press conference held yesterday the head of the delegation of the European Commission in the country, Miguel Amado, stressed the benefits of the donation, particularly the increased access to drinking water for the poor. But, he said, that time is running short and when the European Commission analyzes the National Indicative Programme at the start of 2003, the resources could be transferred to another ACP country. 
The $53-million Euros is part of the €176-million National Indicative Programme that President Hipolito Mejia and the EU Commissioner for Development, Poul Nielson, signed in June 2002. This program consists of two areas of priority: Education ($54-million Euros) and water ($53-million Euros).
Amado explained that one of the key characteristics of the Cotonou Agreement is precisely that there is an obligation to allocate resources according to performance in the execution of programs and the attainment of objectives.

Errata
In yesterday’s new item concerning the official visit of Gustavo Noboa with President Hipolito Mejia, it was erroneously stated that the Ecuadorian president has been described as the richest man in his country. While this was reported as fact in a newspaper article, it was in reality a confusion with Alvaro Noboa, as a reader wrote in to clarify. 

Credit cards and gasoline
The National Association of Gasoline Stations (ANADEGAS) is urging Cardnet, which supervises nearly all credit card transactions in the Dominican Republic, to reconsider the increase in its credit card charges, as reported in the Listin and Hoy newspaper today. Cardnet raised its commission from 1.88% to 2.25 %. The gasoline dealers complain that this will in turn increase their costs by a margin of RD$1.01 pesos per gallon, bringing the total cost for each gallon sold by credit card to RD$1.56. Juan Ignacio Espaillat, ANADEGAS president, said the stations could boycott credit card purchases of gasoline. The principle argument of the gasoline dealers is that while supermarkets and other stores may pass the additional costs on to their clients, the gasoline dealer is required by law to sell fuel at specific prices, set by the latest quotes on the international oil market. They have no way to pass the additional charges on to the client.

2003 Budget hits RD$83-billion
The government’s budget for 2003 is for a proposed amount of RD$83-billion, and did not include income from the so-called “Little Package” of new taxes. The National Development Council will study the finalized budget today. Sources close to the Council have told reporters that RD$35-billion in requisitions made by government departments were cut from the plan, and that the Development Council has established limitations and controls for the use of the appropriations contemplated within the budget.
The 2003 National Budget includes an overall raise of 7% for the bureaucrats.
According to these same sources, President Mejia attended several of the work sessions at which the budget was developed, and specified that the projected annual budget was to emphasize social programs for the needy. Mejia has invited representatives from business, agricultural and commercial associations to study the new budget, which is RD$10-billion higher than the budget of last year.

New Monetary Code moves in Congress
The Chamber of Deputies of the National Congress approved the first reading on the Monetary and Finance Code. The Code was then sent to the Finance Committee for final revisions. It will be reviewed again today and final approval is expected. Before yesterday’s vote, the PRSC deputy, Mario Fernandez Saviñon, produced a birthday cake with ten candles to celebrate the ten years that this legislation has been in the Congress. 
News sources say that at least 11 foreign banks are waiting for passage of the legislation to do business in the Dominican Republic. According to the director of the Office for Promoting Foreign Investments in the Dominican Republic (OPI-RD), Danilo Rosario, banks from the United States, Asia, Europe, and Central America are anxious to enter the Dominican marketplace.

The President to address energy again
Long blackouts, as reported yesterday, have produced a new energy crisis. According to Minister of Finance Jose Lois Malkum, President Mejia will talk to the nation “one last time” on the matter. This speech will depend on the results of the latest audit being conducted regarding the capitalization process. 

Central American & Caribbean Games 2002
President Hipolito Mejia wished the best of luck to the Dominican delegation to the XIX Central American and Caribbean Games that left for El Salvador yesterday. He said that he had every confidence that they would do their best and bring honor to the country. These games are a major precursor to the Pan Am Games of 2003. The Dominican delegation will be the largest present, owing largely to the fact that Cuba has announced it will not participate. On a curious side note, Santo Domingo will host three events for the El Salvador Games: handball, skeet and racquetball.

Violence against women
To varying degrees, all of today’s newspapers accent violence against women. El Caribe features its lead article on the situation and the Hoy and Listin give it ample space, as does the Diario Libre on its front page. The story is simple: violence against women cost 131 lives last year and left over a dozen orphaned children. This figure represents 27 cases more than in 2000. According to the report titled Femenicide in the Dominican Republic, published by the Dominican Association of Family Welfare, of the 131 incidents, 74 occurred in Santo Domingo and Santiago - 56.4% of the total. The report also points out that in at least three of the cases the police were informed of the violence but refrained from taking any action; giving excuses such as that they did not have any vehicles to get to the residence, that it was “spousal affair” or that “they were on their way,” or would “come in the morning.” When they finally did arrive the deaths had already occurred. Another aspect of the report singles out the chaos within the judicial system that surrounds the handling of the documentation of these cases, due to the fact that each department, whether that of Homicide, District Attorney, Court, or Forensics, gave the cases a different number and causing great confusion. The study also shows that these cases are under reported. Only 101 cases are on the “official” list, while there are 131 documented cased in the judiciary system.

J P Morgan and others like the DR
According to a press release from the Central Bank of the Dominican Republic, the investment house of J P Morgan considers the Dominican Republic one of the countries that “has consistently maintained a solid growth rate over the last five years.” According to J P Morgan the country has averaged a growth rate of 6.7%. The investment bank mentions the international optimism regarding the government’s management of the economy. JP Morgan handled part of the funding for the first sovereign bond issuance of US$500-million dollars. The Central Bank also points out the Standard and Poor’s rating, as well as Moody’s ranking of the country. In October, the United Nations Conference on Trade and Development (UNCTAD) placed the Dominican Republic among the leaders in obtaining direct foreign investments, ranking 31st out of 140 countries listed.

Senate approves more loans
The Senate approved yesterday US$133.7-million in new loans for sporting facilities for many of the smaller municipalities, investments in agro-technology for better crop production, and effective signage along the major highways. While there was some opposition to the loans, the 23 senators of the majority PRD party were able to pass the legislation. At the same time, there was a movement within Congress to raise the limit of the new bond issue to US$800-million dollars, representing a renewed attempt to repurchase the shares of the electrical distribution companies. Minister of Finance Jose Lois Malkum and President Hipolito Mejia oppose the idea.

Ethanol for the Dominican Republic
El Caribe focuses today on the pros and cons of ethanol use. Projected plans to use ethanol made from sugar cane would save the country nearly US$80-million dollars, bring the sugar industry back to life and better the lives of the people in the sugar mill “bateys”, according to an early study. Also according to the study, the government would lose a sizable amount of income in gasoline taxes. Danilo del Rosario, the head of the Dominican Center for Exports and the Office of Investment Promotion, favors the implementation of this technology. At present the country is producing only 600,000 tons of sugar annually and must import at least the same amount to cover its own national demand. There are 80,000 families that are living in serious poverty in close proximity to the old sugar mills. Del Rosario told reporters that there are several companies interested in the project and that the president has signed preliminary agreements with the Cavendish Group to carry out some basic feasibility studies. 
For its part, the Dominican Association of Sugar Tenants (FEDOCA), through its president Juan Antonio Japa, has stated that, while the most recent crop yielded roughly 4.5 million tons of cane, this is down from a peak of 14 million tons previously. FEDOCA told the press that they had anticipated the government’s actions and were already building an ethanol plant in Guabatico in conjunction with an Italian firm, Silcompa. Production could be expected to commence there in the year 2004. 
Opposition to these plans is coming from various sectors connected to the sugar industry. Campos de Moya, of the Vicini Group, feels that, while sugar prices are low at the present time and that this will facilitate ethanol production, the Dominican Republic does not control the world market price of sugar. Therefore, if the price rises above 6¢ a pound, ethanol is no longer attractive to produce. He also referred to the legislation needed to permit the use of ethanol, due to the need to protect the industry, once it is started. 
The head of the Dominican Refinery, Amaury Justo Duarte, told the newspaper that while the production of ethanol is subsidized abroad, he wondered if Dominican consumers would have to bear the full cost of the product. He also mentioned technicalities, such as a lower yield per kilometer/gallon of ethanol fuel when compared to gasoline.
El Caribe also mentions a recent report featured in The Economist that states that the production of ethanol in the United States is only possible because of enormous government subsidies.

Baseball
Last night the Giants defeated the Leones de Escogido 3-2, in Santo Domingo. The Estrellas defeated Licey 5-1, handing Licey their fifth straight loss. The Aguilas defeated the Azucareros 4-2 in La Romana and remain on top of the standings.

Standings:
Aguilas 18 7
Estrellas 14 11
Gigantes 12 13
Escogido 11 14
Licey 10 15
Azucareros 10 15
 
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