The Dominican Republic has failed to provide the information on eight of the points set out in the International Monetary Fund letter of intent, but, during the first two reviews of the agreement, it has asked for extensions or permission to provide the data at a later date. According to Diario Libre, the new letter of intent that will be signed on 17 October also includes the requests for the dispensations. These requests are found in paragraphs 2, 12, 13, 15, 16, 19, 24, and 25 of the report on the first and second reviews of the IMF agreement. Much of the failures were in providing the data requested by the IMF. In the first case, an economic report due in October on September's economic behavior will feed into the third review towards the end of this year. The Dominican economic team of Hector Valdez Albizu, Temistocles Montas and Vicente Bengoa reported to the IMF director general Rodrigo de Rato, that the redesign of the institutional and fiscal control framework was very complex on the one hand and the delay in legislative projects before the National Congress on the other, have caused the team to request an extension of the deadlines. Another area requiring an extension was the data concerning late payments of the public debt, including the volume of the debt. The problem seems to be a lack of documentation concerning the debt as of the end of 2004, both on the part of public officials as well as private suppliers who have not turned in the legal documents required.
In spite of all this, Franco Uccelli, the Bear Stearns Investments specialist on the Dominican Republic says that the IMF will approve the Letter of Intent that the DR submitted to the IMF board of directors. Uccelli did emphasize that there were several major challenges ahead for the nation. In his report, Franco Uccelli says that the letter of intent was drawn up to coincide with the end of the first and second reviews of the current IMF program in the Dominican Republic. Uccelli says that a large part of the letter "was astutely communicated to the financial markets by the Fernandez administration as part of their efforts to manage expectations, and because of which there are few surprises in the new document." The official forecast for the 2005 GDP was raised from 2.5% to 4%, inflation was reduced from the 11% - 13% range to single digits (the Central Bank is talking about 6% - 8%), the surplus in current accounts was reduced from 2% to 1.6%, and the goal of the non-financed public sector was increased slightly from 0.7% to 0.8% of the GDP. Uccelli sees the Dominican Republic with good reason to celebrate the upcoming signing of the new IMF agreement.
Juan Hernandez, the director general of Internal Revenue, has told Congress that in order to become more efficient, the Internal Revenue Department (IR) needed more teeth in the legislation that punishes tax evaders. According to Listin Diario, Hernandez wants Congress to pass the proposed law that will make tax evasion a criminal offense, and give his department an important tool that would make tax collection more efficient. According to Hernandez, such a step would reduce the non-payment of taxes and guarantee the efficiency that institutions such as the World Bank and the International Monetary Fund are demanding of the Dominican government. Hernandez pointed out that there are 10 or 12 cases currently before the courts, and none of them have received a verdict. The IR director said that the ball is now in the legislators' court. The law that he was lobbying for will allow tax evasion cases to be expedited within the court system, and the threat of a criminal complaint should move possible tax evaders to think twice. Hernandez made his comments to the press after participating in the international seminar "Tax Policy and Ways to Collect" that was held in the Auditorium of the Central Bank yesterday.
According to Hernandez, the "Anti-Evasion Plan" currently underway at the Internal Revenue office is giving positive results, and some businesses have been shut down for failing to fulfill their obligations of true reporting of the VAT tax monies. The Plan encourages the use of credit cards for purchases and rewards credit card holders by means of a "Fiscal Lottery". Hernandez, who said that the Anti-Evasion Plan was to continue, also added that he felt that the proposed legislation would be an even more effective weapon against those that don't pay their taxes.
Tourism Minister Felix Jimenez announced yesterday that the government would modify the three laws that provide incentives for the tourism industry. However, he did reassure that the special benefits and tax exemptions for all-inclusive hotels, marinas, convention centers and theme parks would be maintained. The plan is to avoid a stalemate in the sector, and Jimenez said that the project would be handed to Congress as part of the IMF agreement that was signed in January. The tourism boss said that the IMF had requested the removal of tax incentives in the tourism sector.
The Central Electoral Board (JCE) and the major political parties have agreed on a time line for the 2006 congressional and municipal elections. As part of the process, a commission from the JCE traveled to Brazil to begin the process of acquiring 3,000 electronic voting machines for the upcoming elections. There will be close to 200,000 new voters, who, added to the current voter registration rolls, will make up the 5.4 million people with voting rights in these elections. The voters will be electing 32 senators, 178 deputies, 151 mayors and 962 municipal council members. The JCE will be hiring a total of 105,000 people to work on the election. And they will have a lot to do. The nation currently has 151 municipal election boards, and, of these, there are 17 new ones and 44 re-structured ones. There will be 3,088 electoral stations and a total of 12,537 polling stations.
Key parts of the process are the 16 December closing of new "cedulas" - the personal voter registrations card and identification card supposedly carried by every Dominican over 16- and the closing of voter registration rolls on 16 January 2006. The election will be officially announced on 16 February 2006 and 2 March 2006 is the deadline for establishing electoral alliances. Candidates will be presented on 17 March.
Five men who traveled to Europe on diplomatic passports, purportedly as members of different city councils, had to turn themselves in to the Dominican consulate in Genoa, Italy. They had tried, unsuccessfully to obtain work, and ended up sleeping out in the open. They begged the consul, Mercedes Brito, to send them back to the Dominican Republic. One of the fake councilmen, Felix Julian Estrella, told the consul that he had paid RD$160,000 to obtain the passport The local investigation is reportedly reaching into the Immigration Department as well as the Ministry of Foreign Relations. According to several newspapers, among them Diario Libre and Hoy, the ministry is being looked at because of the speed with which the passports were issued. According to the Diario Libre, two Immigration Department officials are under investigation for the authorizations given to 67 supposed wives and councilmen to travel to Spain and Italy. Sources have told reporters that there is a "gusher" of evidence that the office that facilitated the official passports there was a "strong contact" that made it easy to get the documents. Councilwoman Adolfina Bocio Montero, from Hondo Valle, Elias Pina province, is wanted by the Attorney General's office, since she apparently got married to Edison Munoz Soto in Azua while she was still married to her first husband. Meanwhile, over at the Chancellery office of the Ministry of Foreign Relations, the Diplomatic Passport Unit is under the magnifying glass of the investigators. They are trying to find out how just four people could withdraw, in just one day, 100 diplomatic passports belonging to "wives and children of council members."
Today's edition of the widely read column takes on the electricity sector and the comments made by the Presidential Minister for Technical Affairs, Temistocles Montas. It seems that everything that comes from that sector is bad news. Yesterday, Montas confessed that things had got "much worse" since the PLD government started the privatization process in 1997. Things have reached the point that the subsidy paid by the government to the electricity distributors represents 40% of all the money these entities handle, and this is a whole lot more than what was spent in the days previous to the privatization process just mentioned. The minister offered, as would be expected, an explanation that would justify such a somber diagnosis, however it is surprising in its simplicity: the poor administration of the previous four years. The columnist says that the worst thing is not to prove once again that the governments pass on, from one to another, the blame for all the bad things that were done or the good things that were not done, but rather that those that speak in the name of the government do not even entertain us with a false hope of obtaining "sustainability" (in which nobody believes) in the electric sector, in spite of having sold this idea to us as an indispensable requisite to achieve a level of development that, official pronouncements aside, nobody is ready to forecast how or when it will arrive at our doorstep.
The president of the Central Electoral Board, Luis Arias, has said that late birth declarations are a "national calamity", and promised that the creation of a new unit of the JCE would deal exclusively with the problem. At the same time, according to El Caribe, Arias denied that there were as many as two million people in the country who are not in possession of legal documents due to the lack of a birth certificate. Arias said, "If in the latest census there were eight million or so people, and at the JCE we have voter registration records for 5.3 million people, it is not logical that there can be two million people without documents." Magistrate Roberto Rosario told reporters that the World Bank would be providing US$20 million in order for the JCE to create a specialized department that will deal exclusively with the problem of late birth records.
Colonel Juan Geronimo Brown Perez, the commander of the "Safe Barrio" pilot project still has to answer to the courts for his alleged part in the case involving the illegal use of recovered stolen vehicles. The Prosecutor's office still has his case on the books. Due to resolution 462-2003 of the National District Fifth Court of Instruction, the case against Brown was separated from the other four dozen officers since he was out of the country. On 5 July 2005, when the court's decision was published, Brown was studying Security and Hemispherical Defense at the National Defense School in Washington, D.C. He returned to the Dominican Republic in late July, having spent a year at his studies. Nevertheless, he was given command of one of the most highly visible National Police programs. Sources within the police say that if the Justice Department needs to talk to Brown, they will make sure he shows up.
The new permits that will allow new drivers to learn how to operate motor vehicles will include some interesting new features. The new permits will include biometric data, fingerprints, and allow the Director of Surface Transit (DGTT) to create a database of drivers. The head of the DGTT office, Rafael Crespo, said that his staff have found that some people try to obtain permits with fake or cancelled personal identification cards ("cedulas"). The result of this experience led the department to design a system that allows the different institutions that deal with transit issues to review and search out citizens that need to be found. AMET, the National Police, the Immigration Department and the Passport Office will be part of the program. The new permit process is also connected to the Central Electoral Board, the Ministry of the Interior and the Police, the Attorney General's office and the Internal Revenue department.
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