| Daily News - 15 December 2003 |
President Hipolito Mejia announced in Monte Plata, to the North of Santo Domingo, that the talks with the IMF had concluded, and that next week he would send the 2004 Budget to Congress for approval. The National Development Council will look at the RD$120-billion budget, representing expenditures of RD$37 billion more than last year, before it goes to Congress. The new budget includes RD$100 billion in regular income and RD$20 billion in international aid and donations.
The highly-touted political convention, called by one faction of the PRD party and scheduled for yesterday, has been postponed for another week. The rescheduling came after three of the presidential hopefuls requested a new date. Depending on which paper one reads, the reason for the postponement varied from poor organization (Hoy) to the threat of fraud (El Caribe). The Listin Diario said that Milagros Ortiz Bosch had requested the postponement due to the fact there were 475,000 names missing from the electoral rolls, while at the same time there was listed a curiously large number of well-known members of the PRSC, the Catholic clergy, and the PLD. According to Eligio Jaquez, Agricultural Minister and coordinator for the PPH movement (Proyecto Presidencial Hipolito), there was a simple explanation for the discrepancies. He told reporters that what had probably happened was that personnel for the different candidates, anxious to augment the number of people supporting their candidate, simply copied entire voter registration records onto CDs that were going to be used for the PRD convention. President Mejia took advantage of the delay to describe his opponents as "scared". Hatuey De Camps, the official candidate for the other faction of the party, said to reporters, "I told you so." De Camps said he had warned the three presidential hopefuls participating in the nominating convention alongside President Mejia that they were heading into a "…slaughterhouse, given the zinc and wood, all the money and helicopters all over the place…" Previously, the other candidates had accused the PPH faction of purposely scheduling the distribution of zinc and wood materials for rebuilding houses to coincide with and detract from the political rallies of the other candidates. Eligio Jaquez said that this concurrence was merely a "coincidence."
The fairly spontaneous "Yatabueno" movement among middle-class students appears to be picking up steam after a second demonstration along Winston Churchill Boulevard. "Yatabueno" is, in Dominican speak, a phrase that translates to "That's enough!" The second manifestation by the group's supporters was easily twice the size of the first and much more vocal, using, according to El Caribe, some of the more popular Dominican sayings in hugely ironic fashion. ("La economia esta sana, culito de rana.") Called "alternative resistance" by the organizers, they managed to gather people from ages 17 to 26, including young publicists, one singer, businesspeople, designers and lawyers. In a new scenario, entire families took part, right down to the grandchildren. One grandmother told reporters that she was doing this for her grandchildren, to combat a government that she said is "ruining their future." Group organizers attributed the greater number of protesters to the fact that after the first action several television shows invited organizers to comment on what was happening. Because they felt they were incorrectly stereotyped as "rich kids out to protect their own interests" by the television media, the organizers will, at present, limit their efforts to press releases.
Mario Mendez, the economic editor for Hoy newspaper, reported on Saturday that the government is studying the possibility of adding new taxes or increasing the reach of existing ones. According to Mendez, if the new taxes are approved, many items will become unaffordable to most consumers, and this will give rise to an increase in contraband. Among the new proposals will be a 5% tax on hard currencies produced by the export and tourist sectors and an expanded ITBIS (value-added tax) that would be increased to 15% and applied to a broader spectrum of items. Also being reviewed are the taxes on electrical appliances, motor vehicles, tobacco and alcohol products. Additionally, there is a proposal to increase personal and corporate income tax to 30%, up from the current 25%. Other proposals include a 10% tax on savings. Talking to economists and business leaders, Mendez reports that the end result of the proposals will be the further erosion of the peso's buying power and, ultimately, a major recession.
Mickey Ceara Hatton suggests in the Listin Diario's economic section today that the Dominican Republic should hold off further talks on the free trade agreement with the United States. He reasons that because the Dominican delegation is working against the clock, there is not enough time to completely analyze all the ramifications, especially during an election period with all its surrounding uncertainties. Ceara Hatton says that a commercial treaty would imply a "brutal reform" within the framework of a macroeconomic crisis and a huge reduction in income from tariffs. One of his most telling arguments is that the added value of a new free trade agreement would be approximately zero, as almost 100% of Dominican goods entering the United States do so duty-free, anyway. Because the ratification of such an agreement is a commitment that works two ways, Ceara Hatton says that a structural reform would be needed to comply with the agreement and "we", the Dominican side, do not know all the implications of a two-way stream of products. The economist adds that even though much of the process would favor the industrial free trade zones, these industrial hubs only represent between 2% to 10% of the GDP, leading Ceara Hatton, and others, to wonder "What happens to the other 90%?"
Among other stories on the current wave of inflation, Hector Linares, writing for Saturday's Listin Diario, reported that the increased cost of the dollar was the principle culprit. The impact of the exchange rate on the costs of goods and services pushed the inflation to 6.01% in November, placing the 11-month total at 37.55% for the year. This is more than two percentage points above the Central Bank projections for the entire year. In a press release, the Central Bank says the Consumer Price Index climbed 6.01% over October. This represents inflation of 40.05% for the November 2002 to November 2003 period. The Central Bank grouped food, drink and tobacco; transportation; and hotels bars and restaurants as the three areas responsible for 89% of the CPI increase.
Bernardo Vega, ambassador and economist, historian and businessman, writes in today's El Caribe on the importance of US envoy Roger Noriega's visit to the Dominican Republic. From a historical outlook, Vega cannot remember any other visit from so high ranking an official as Noriega, who was once a top advisor to former Senator Jesse Helms. Perhaps the highlight of Noriega's visit was the announcement that the US would pick up the tab for various groups of pre-election observers. Vega says that the 'pre-electoral' part is very important, since these people will arrive in February rather than just a few days before the elections, and went on to mention such groups as the Organization of American States, the International Federation of Electoral Systems (IFES), the National Democratic Institute, the National Republican Institute, the Carter Center, and CAPEL from Costa Rica. Recently, the European Union observed the electoral process in Guatemala and will almost certainly be invited to observe here as well. Vega states that the US in interested in the process of the elections, not the result. They want clean elections, without favoring any candidate. Saying that the time for electoral fraud has passed, Vega reminded the reader that equally irrelevant was the old Porfirio Diaz advice, which was to "say 'yes' to the Americans, but not 'when'."
Economist Frederic Emam-Zade wrote a humorous column in today's El Caribe, posing a fictitious dialogue between friends. One says he needs dollars and the other tells him how to do it outside of the normal course of events. Scenario No. 1 had the man depositing pesos into an account in the DR and the man in New York depositing dollars to the first man's dollar account in New York City. But no, that would not work because a fax would be needed to seal the deal. Then, the guy in New York suggests the buyer go to a jewelry store and purchase an equal value of jewelry and bring it to him in NYC, where it could be exchanged for dollars and a small profit. "If that doesn't work, I have a lot of other solutions for your problems," concludes the seller. The buyer, now very happy, changes the subject and asks about the government's new policies to control the exchange rate. The man in New York says that the problem is the excess amount of pesos in circulation and says that all the steps the government is taking will only produce more activity in the black market. "This will produce a lot of money for the small operators like you and me," he says. Asking what would happen if the government were to jail all the people operating with dollars, Emam-Zade springs the joke: The government would have to put half the country in jail, since everyone is betting on the dollar. But then the black market would be the only market functioning and for them this would mean the dollar would shoot up in price and "with my relationships here in dollars and yours there in pesos and the Internet and chat room technology, we would become millionaires! I guarantee it, compadre!"
A baby girl was born with two heads on Wednesday, 10 December at the Felix Maria Goico (Los Billeteros) public hospital in Santo Domingo. Neurological studies indicate that each of the heads has a brain, according to the director of the hospital, Rafael Borrome, who spoke to the Listin Diario. Benjamin Rivera, the neurosurgeon who is treating the baby, has initiated contact with the Mattel Children's Hospital at the University of California at Los Angeles for the transfer of the infant to that facility. Baby Rebeca's health is reportedly stable and she is being fed normally. The parents, who are receiving psychological counseling, could have their daughter home as early as next week. This is the 26-year-old mother's third child. The baby was born by Caesarean section and weighed approximately eight pounds. With only eight known such cases, the little girl represents a rare medical situation and most such cases are operated on. The baby girl's second head is attached to her first head and shows some parts of the face not defined.
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