President Hipolito Mejia returned yesterday from his 12-day trip to Spain, Israel, Jordan and Holland, marking his 38th international expedition in his three years in government. He arrived at 5:10pm from Madrid on board an Air Europa flight and was received by Vice-President Milagros Ortiz Bosch. He described his trip as a very good one.
Monday morning's 6.5-magnitude earthquake caused damages estimated at RD$500-RD$700 million in the northern and central regions of the country. El Caribe reports that according to bulletin No. 4 of Emergency Committee, 121 buildings were damaged in Santiago, of which 42 were private dwellings. The tally also includes 44 public schools, 4 hospitals, 4 government offices, and 24 shops. In Puerto Plata, 103 buildings were affected: 47 dwellings, 6 public schools, 1 hospital, 10 government offices, 34 shops and 5 miscellaneous structures. Approximately 10,000 students in Puerto Plata public schools were left without classrooms. In Santiago, where 140 classrooms were considerably damaged, 8,000 students were unable to attend courses in the wake of the seismic activity. The Institute of Seismology says there have been 160 aftershocks following the initial quake. According to the official report, three people died as a consequence of the earthquake - two of heart attacks and one man who was fatally injured when the Mercedes boarding house where he was staying collapsed.
After the "buscones", or those who make a living by using their government connections, had been disposed of during the government enhancement programs of the Fernandez government of 1996-2000, Hoy newspaper reports they are now a practical necessity to cut red tape. The newspaper cites of the case of a woman residing in the US, who wanted to renew her cedula. According to Carmen Lorena Cruz Tejada, she paid RD$1,600 and obtained her documents in two hours, instead of the two months offered at the JCE. She explained she could also have gotten it for RD$1,300 in two days.
City residents of Santo Domingo have been wondering why the government has been steadily increasing the cost of the water supply service. Journalist Marino Zapete revealed that his monthly water bill had gone up from RD$96 in December of last year to RD$1,718 this month, without his consumption having increased. The exponential cost of water service is common all across the capital city. The CAASD (the governmental department in charge of the service) had explained that water meters were to be installed, and people would be billed per consumption. But sectors say that these meters are reading nothing but air, as in many barrios where the service is deficient the meters are still running despite the absence of water traveling through pipes.
Hoy newspaper reports that the IMF has requested the Dominican government postpone the implementation of its agreement with Union Fenosa for 30 days. Reportedly, the request is made in a letter to government authorities delivered to the government via Central Bank Governor Jose Lois Malkum, who was attending the IMF meeting in Dubai. An IMF mission is due next week to monitor governmental fulfillment of the stand-by arrangement. The IMF is apparently curious as to how the buyback of Union Fenosa's power distributors will affect governmental finances. According to the report in Hoy, Finance Minister Rafael Calderon denied that the deal would require an increase in taxes. Calderon says he has not received notification of the IMF's objections to the deal. The newspaper recalls that the Union Fenosa agreement will cost the country more than US$700 million over a 12-year period. The government had originally sold its 50% participation in 1998 to Union Fenosa for slightly over US$200 million. Meanwhile, the US$200-million World Bank assistance for the electric sector has not yet been disbursed.
The Chamber of Deputies has on its agenda today a review of the request to place US$255 million in sovereign bonds on the market to finance the construction of the Coral Highway. The new highway would link the tourist areas in San Pedro de Macoris (Juan Dolio and Guayacanes) and La Romana (La Romana, Bayahibe and Dominicus) to the cities of Higuey and Veron (cross point for Punta Cana, Macao, Uvero Alto, and Bavaro) in the province of La Altagracia. If the proposal is accepted by the Chamber of Deputies, it would next move on to the Senate. Proponents argue that the highway would link three international airports to the areas in which 70% of all hotel rooms are located. The original highway plans drawn up during the Fernandez administration had projected a reduced travel time from Santo Domingo to Veron of about a one-hour drive, as it drew a straight line, passing north of La Romana. The new route is now 165 kilometers long, representing an approximate two-hour drive from Santo Domingo. The present trajectory entails a four-hour drive. The new highway's route would require the following works: Completed construction of the San Pedro de Macoris bypass highway (13.1 kms) Expansion of the San Pedro de Macoris-La Romana highway (35.2 kms) to four lanes Completed construction of the La Romana bypass highway (13.7 kms) Design and construction of the stretch of the highway from La Romana-Higuey (29 kms) Construction of the stretch of the Higuey highway to Veron, as per the original plans (33 kms) In 2001, the Mejia government had announced the concession of the highway to a private company.
Hoy newspaper's economic editor, Mario Mendez writes in the Wednesday, 24 September issue that the Mejia government continues to negotiate more foreign debt, despite having pledged to discontinue the practice. Mendez compares the government's habit to that of the private sector, saying that businesses have been making significant strides to reduce indebtedness in dollars - especially given the declining value of the peso. Meanwhile, the public sector continues to contract new loans in foreign currency. Mendez says the cost to service the debt has tripled and the profile of Dominican liabilities under the Mejia government has made a radical departure from being long-term with multilateral and bilateral organizations, to one of predominantly short-term debt to foreign commercial banks. The various sectors question the fact that the government has taken on US$3.9 billion in loans this year, according to a report presented by Senator Jose Tomas Perez (PLD-National District). Economists consulted say that the payment of the debt will require 40% of the budget and 50% of tax revenues, when proper fiscal policy would dictate that foreign debt not exceed more than 20% of the national budget. At this rate, by 2004 the government will only be able to dedicate 5% of the 2004 national budget to infrastructure works in 2004, with its bulk going to government payroll and debt-servicing obligations. As part of the achievements of President Mejia's trip to Europe, it was reported that financing for a 140-million-euro loan for Nagua waterworks was secured. Furthermore, the Dominican government recently committed itself to the terms of a 12-year buyout of the Union Fenosa power distributors, for an average of US$60 million. This is in addition to the proposed US$255 million in sovereign bonds to finance the Coral Highway that would link Juan Dolio to Punta Cana.
The Central Bank explained that the postponement of the non-transferability of savings certificates issued to Baninter clients does not imply delays in the payment of these commitments. The Central Bank deferred the transferability of the RD$20 billion savings certificates until March 2004, but clarified that "the titles will be honored once they are due, according to preset procedures and following agreements signed with Scotiabank, so as to extend the services to the clients of Baninter."
The ruling PRD party is unmistakably divided in two factions - the PPH (that supports President Mejia's re-election aspirations) and the non-PPH (that groups the other seven pre-candidates for the presidential nomination and their followers). The non-PPH supporters, led by party president Hatuey de Camps and party secretary general Rafael Subervi Bonilla, have called for a plebiscite to be held on 12 October to allow members of the party to vote on whether the party backs the re-election of President Mejia. The results of the plebiscite would not bind the party legally in any way, but would serve as gauge of opinion on whether party members favor the continuation of Mejia's government. The PPH faction promoting Mejia's re-election and President Hipolito Mejia himself, however, oppose the plebiscite. President Mejia, while in Spain, responded to the announcement of the plebiscite by offering to eliminate the second round from the PRD convention. He proposed that the candidate to receive the most votes should become the PRD's official candidate. The PPH has announced their primaries for 23 November. The non-PPH bloc has suggested the party convention take place on 2 November, shortly after the plebiscite. For their part, PPH followers have said they would boycott the plebiscite.
Luis Molina Achecar, president of the BHD bank, urged measures to lower banking interest rates. He said that the restrictive procedures implemented by the government in order to exert pressure to lower the exchange rate have forced interest rates up to 40% or more, which has had a chilling effect on borrowers. Achecar also said that the BHD bank alone has an excess liquidity of RD$4 billion, but that there were few prospective borrowers at those rates. He said the Association of Commercial Banks of the Dominican Republic was not in favor of the restrictive monetary policies that mostly have affected the productive sectors.
Aerodom, which manages the Las Americas International Airport and is responsible for the operations of La Isabela International Airport (currently awaiting international certification), objects to Decree 832-03, by which a commission to study the conversion of the San Isidro military base to incorporate commercial traffic was created. Aerodom spokesman Ellis Perez said the company was waiting for the return of President Mejia to request the annulment of the decree. As reported in El Caribe, the conversion of San Isidro would eliminate the raison d'etre of La Isabela airport. Aerodom also argues that the investment to San Isidro is superfluous, as the airports already completed meet the estimated traffic and cargo demands for the next 20 years.
Father Rogelio Cruz, who recently returned from a conference with his Salesian Order superiors in Mexico, says he will stay in the Dominican Republic. It had been rumored that the controversial and outspoken priest would be transferred to Rome. Nevertheless, the cleric said he has been authorized to remain in his Cristo Rey parish for an undisclosed period of time, and would later be relocated elsewhere in the DR.
Former Central American and Caribbean table-tennis champion Mario Alvarez Soto announced the inception of the Mario Alvarez Table Tennis Academy on Friday. The academy will be located at the new table-tennis facility in the Parque del Este that was built for the Pan Am Games. Francisco Boyero, the new Academy's pro, said the teaching center plans to train the table-tennis greats of the future. Anyone interested in joining should call 535-2980.
Felix Sanchez is on a roll with 33 consecutive victories since 20 July 2001 when he won the Monaco Grand Prix. On Tuesday, 23 September, running for the Dominican Republic, Sanchez won first place in the Yokohama, Japan meet, with a 48.86 time, slightly bettering the 48.99 that earned him the gold medal at the Pan American Games in Santo Domingo, but falling somewhat short of the 47.25 mark he scored in Paris on 29 August, his fastest time so far this year. For a moving story on Sanchez, see http://www.letsrun.com/2003/rojospeaks080703.htm
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