Annet Cardenas reports for Diario Libre that 441,528 people voted in the PRD plebiscite on the re-election issue on Sunday. Of the total, 92% voted No in answer to the question of re-election as a principle. According to Henry Mejia, the PRD's director of elections, 99% of the votes have been counted and the PRD leaders and party members will have to acknowledge this outcome. Tirso Mejia Ricart, a member of the mediation committee of the party, told reporters that as soon as things cool down a bit, the committee would get together with the candidates and "find a solution (to the crisis)."
Hoy newspaper reports that so far this month six ministries have not paid their staffs' first two weeks' salaries of this month. According to the article, the budget office said that the accounting commission that controls the government's books sent the majority of the payrolls back to their ministries "to be redone with clarity and precision." National Treasurer Pastora Mendez de Fondeur told reporters that the delay was caused by certain ministries that had handed in their payrolls too late. The source, said to be "close to the issue", told Hoy that the commission was possibly following recommendations from outside consultants and has requested that all pay vouchers show proof of work fulfilled by that person.
The director for the governmental National Institute for Price Stabilization (INESPRE) announced yesterday that the programs for farmers' markets and the sale of everyday food items would be intensified in the coming days as an effort to halt the price speculation that has been seen in the price of rice, for example. According to Pablo Mercedes, the head of INESPRE, there will be 50 trucks selling products such as onions, rice and other staples in the Santo Domingo area. In Santiago, Moca and Puerto Plata, there will be 30 trucks working on public direct-to-consumer sales.
Technical Secretary of the Presidency Carlos Despradel has said the government needs more tax revenues and will impose them "in a few days." The economic editor of the Listin Diario, Hector Linares, writes today on one that may be THE tax. This again refers to the proposal circulating, whereby the government would tax the yields of savings certificates. The newspaper says this would produce RD$2.7 billion a year - enough to offset the eliminated 5% tax on exports needed for the government to maintain its present level of spending. Linares points out that the new tax would be very easy to apply, as the banks would retain the tax for the government. There are 12 commercial banks, 18 savings and loans banks, 17 development banks, one mortgage bank and 17 financial intermediaries authorized to operate by the government. Cooperatives could be exempt from the measure. To tax interest rates, Law 11-92, which exempts savings deposits from income tax remittances, would need to be modified by Congress. The economic editor says that the downside would be that it would penalize those who, instead of spending or converting their pesos to dollars for deposit abroad, have entrusted their funds to savings accounts in the country.
El Caribe reports that the tax reforms requested by the business and industrial community would focus on the ITBIS and would either raise the rate or extend the consumer tax to yet more articles. The businesspeople also suggested raising the taxes on license plates and real estate, as well as other internal taxes. This was the position of the Industrial Association of the Dominican Republic, CONEP and the National Association of Importers, who met last week with Rafael Calderon, the Finance Minister. One of the proposals made last year was to reduce the ITBIS (a value-added tax) to 9% from the present 12%, and collect it universally on every item sold in the country. Hoy's Aleida Plasencia reports that many businesspeople feel that higher taxes will only stimulate further tax evasion by those hardest hit. Ignacio Mendez commented that if the government were to collect 75% of the taxes that were being dodged, there would be no need to reform the tax laws.
The Baninter scandal reached the halls of the United States Congress yesterday, when, according to the Listin Diario, the Undersecretary of State for the Western Hemisphere, Roger Noriega, told a House sub-committee on Western Hemisphere Affairs that President Mejia and his government acted correctly in uncovering the issues surrounding Baninter. Noriega and Bob Menendez (D-NJ) were testifying on the corruption within certain governments of Latin America. According to Noriega, the Dominican government investigated and identified the factors in the Baninter case, and "faced an extraordinarily wide spectrum of corruption, in which one family in particular maintained a vast network of corruption. …To (Mejia's) credit, his government has identified a lot of people that have a lot to account for…" Menendez told the committee that he was especially worried about the corruption in the Dominican Republic and a certain family's bank that had wasted US$2 billion, according to the Associated Press. Menendez also felt that the Bush administration had followed an "incoherent" policy with regards to Latin America, and especially countries like The Dominican Republic, Bolivia and Haiti.
Pedro Silverio, columnist and chief economist at the Cenantillas research facility at the PUCMM in Santo Domingo, comments on the three elements that seriously threaten the ability of the authorities to govern. The first is the internal crisis of the PRD party, which could erode political backing for the current government and install a President who lacks his own party's support. A second factor could be derived from the relentless discourse on re-election, while talking about tax policy and public spending, which fly in the face of the recommendations made by the head of the Central Bank concerning stricter fiscal discipline. Silverio says that to repeat the same mistakes that have landed us in the current situation is, in itself, a menace to good governance. The third element, says Silverio, is the improper dissertations that have placed the full blame for the failure of the government's social policies squarely on the shoulders of the business community. This could stimulate friction between the business contingent and the workers, as well as between rich and poor. The economist finishes by saying that by fueling a conflict between the haves and the have-nots, the government is also abetting a clash between itself and the business community. He warns that the situation in Bolivia should serve as an example for the local authorities.
The investment bank Goldman Sachs has announced its purchase of Cogentrix for an undetermined amount. Cogentrix is the parent company of the San Pedro de Macoris electric company that operates the 300-megawatt generating facility, shut down for nearly a year now. Cogentrix owns 26 generating plants and brings the total capacity of Goldman Sachs to 3,300 megawatts of energy worldwide. In the Dominican Republic, the Cogentrix plant has been out of operation due to a continuing conflict with the government over payment for electricity produced and installed capacity fees. Just last week the credit agency Fitch downgraded the Cogentrix stock to negative watch, after the IDB reported on the debt owed by the government. According to the article in El Caribe, there is an accumulated debt of US$135 million. http://www.gs.com/
Adolfo Moreta Feliz writes in Hoy newspaper about the high cost of garbage collection in the Dominican Republic. To make his point, the author comments on councilman Domingo Jimenez, who indicated that the city governments pay US$23 to US$25 to dump the garbage in Duquesa, as reported in Hoy newspaper on 2 October. "The average price the Dominican Republic is paying is equal to a barrel of petroleum," he points out, observing also that while a ship must travel to the DR to deliver the oil, a truck has only to travel to Duquesa, just north of Santo Domingo, to dump the garbage. Moreta points out that Santo Domingo Mayor Roberto Salcedo has said that the domestic waste of the DR is "the most expensive garbage in the world." Moreta writes that others have established similarities of the garbage collection cases with Hydro-Quebec and Cogentrix, but the contract details, causes and reasons have not been disclosed. Moreta mentions that the collection of a truckload of garbage is more expensive than transporting a freight container loaded with new television sets from the Port of Haina to Santiago. Meanwhile, the Dominican government may find itself in court for the debt it contracted with foreign companies to provide the collection service. The author writes that to avoid the present disproportionate prices that unbalance any city budget and result in greater debts for the future, municipal governments should conduct studies on the real cost of collecting a ton of refuse and indicate how it is paid. This would likely answer the question he asks in the article, "Can the cost that the companies and the city governments accept and pay as good and valid be real?" Or the more important question: "Is there any real interest in efficiently solving the garbage collection issue?"
The Diario Libre reports that RD$27 million in gold was taken from one of the warehouses at Las Americas International Airport on the outskirts of Santo Domingo. The precious metal was destined to the Andina del Caribe factory in one of the free trade zones and was of jewelry grade brought in from Miami. Reportedly, the scandal broke yesterday and the police have arrested nearly 20 people in relation to the crime. Certain employees of the Airport Service Division, a subsidiary of American Airlines, were included in the arrests. Diario Libre says that the "lesser" crime of bribery looks as if it will go un- punished, since the head of Customs, Vicente Sanchez Baret, told reporters that the transfer of the entire staff at Las Americas was "routine". Yesterday, almost the entire Customs and military staffs at Las Americas was relocated.
The business community in Santiago de los Caballeros and the rest of the Cibao Valley are appealing to the government for a resolution to the energy crisis that has left the nation's most productive region in the dark for nearly two weeks. Yesterday, as reported in DR1 News, the Santiago Development Association announced a deal with Seaboard to provide 100 megawatts to the power system. Jose Luis Bonilla, the president of the Chamber of Commerce, renewed his call for an "electric superhighway" for the region. President Mejia was in Santiago yesterday to attend a memorial mass and told reporters that the electricity superhighway was well advanced and that he had told Felix Garcia, the head of the APEDI, that he thought the deal with Seaboard was a good idea. Yesterday, the CDEEE announced that 126 circuits were taken out of service due to a 500-megawatt deficit in the system. Some of the problems are technical and some are due to "lack of fuel", a euphemism for a monetary issue. Bonilla, in his statements to the reporters from Hoy, said that the North produces more than half of the GDP, holds 40% of all hotel rooms and half of the national population, and is the least served by the electric grid. Garcia, speaking for the business sector in general, told reporters that the agreement with Seaboard would put 100 megawatts online within one month. This effort by the business community and the government would fill the energy void, as the Smith-Enron and other Puerto Plata units also come back online.
El Caribe is reporting today that the reconstruction efforts in Puerto Plata and Santiago have caused some discontent among the displaced and homeless. Favoritism is being alleged by some, and in other areas people are taking the reconstruction into their own hands because the government has said that it will only rebuild for the poor. In Puerto Plata the government gave RD$10 million to the local government, to be spent, according to Jose Ramon Torres, on wood, nails, hinges and tin roofing to build the most modest homes. Even Bishop Nicanor Pena, a member of the recovery commission, has voiced his opinion that the work is not being done equitably or evenly. In Santiago, one month after the 6.5 earthquake took its toll there, the reconstruction that must be done by the government has not even begun, according to Ramon Gomez, the provincial governor. A total of 164 buildings were damaged in the quake, however, Gio de la Cruz, the local director of Civil Defense, told reporters that some houses, like those in the Cristo Rey slum, would not qualify for assistance as they were built in inappropriate locations.
On Sunday, 2 November, according to a report in today's El Caribe, there will be a flea market taking place under the Luperon overpass. Santo Domingo's municipal council reached an agreement with the flea marketers to establish a new area for their marketplace. Urban planner Emilio Brea told reporters that while the area has been paved, he was worried about parking. Domingo Contreras, the spokesman for the municipal council, said that special AMET units will safeguard those attending the market.
El Caribe reports on the diminished interest in baseball's World Series among Dominicans, who must settle for the Yankees-Marlins series as opposed to the Red Sox-Cubs series, whose teams listed more stellar Dominican players in their rosters. "Truly, the series between New York and Florida was not the preference of Dominicans," admitted Rafael Perez, the director of the Major Leagues Commissioner's Office in Santo Domingo. There are Dominicans, however, playing in the World Series, and local fans continue to tune in, especially since there are many Dominican Yankee fans of players such as Alfonso Soriano and pitcher Felix Heredia. Luis Castillo is one of the leading players for Florida, where Juan Encarnacion is also a team member. Yesterday, thousands of Dominicans listened or watched the Yankees gain a 2-1 lead in the series. The two teams resume the action tonight in Miami for Game 4, as the Yankees send Roger Clemens to face Carl Pavano. The first pitch is scheduled for 8:24pm.
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