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Daily News - Friday, 27 June 2008

Fernandez positive
President Leonel Fernandez is confident that a well-thought out plan and cooperation between the country's private and public sectors will enable the DR to "survive" the food and energy crises that are developing on a global scale. Fernandez made his comments during a meeting at the Agricultural Institute (ISA). Fernandez says that farmers should increase production as a way of fighting the food crisis and that certain measures need to be taken in order to help with this task. During the meeting Fernandez announced the creation of the new Food Security Council, which is expected to help create those measures. Fernandez said "we understand the severity of the situation and the challenges that we are faced with, because it is more than just a food crisis; it is an energy, economic and financial crisis". Fernandez said that the DR needs to look ahead in order to emerge from the crisis successfully.

New council created
The Executive Branch created the Food Security Council through decree 243-08 yesterday. President Leonel Fernandez will head the Council and its goal is to draw up measures to facilitate increased food production. The Food Security Council will also work to create food reserves and a plan for food export, as well as ensuring that the nation's most vulnerable sectors have consistent access to food. The Council will also include the participation of the Ministries of Agriculture, Economy, Planning and Development, Hacienda, Public Health, Industry and Commerce and Environment, as well as the Banco Agricola, the Dominican Agrarian Institute, Innovation in Biotechnology and Industry, the Agro-Business Council and the Center for the Development of Agriculture and Forestry. Fernandez signed the decree during a ceremony held outside the Agricultural Institute (ISA).

CA members quit
Chamber of Accounts members Juan Adalberto Lora and Jose A. Maceo have both resigned, effective immediately. Both cited family reasons for their decision. The members' resignation comes after Chamber of Deputies members voted unanimously to bring charges against the nine CA members for mismanagement and lack of transparency. Senate president Reinaldo Pared Perez said that the resignations will exempt both accountants from going to trial. Hoy writes that Lora and Maceo's exemptions will cause a "domino effect" of resignations by other CA judges. Even if the judges had gone through the trial, Hoy cites Numeral 4 in Article 23 of the Constitution that states that if they are found guilty, the Senate would only be able to dismiss the CA members. Constitutional expert Eduardo Jorge Prats says nevertheless that if penal violations are detected during the Senate hearings, the former CA members could be tried judicially.
The Chamber of Accounts is the government body in charge of auditing government departments.

Councilors in trouble
The Chamber of Deputies could soon be holding a trial for councilors from the National District after they allegedly authorized the construction of high-rise towers in the Cacicazgos area of Santo Domingo. The councilors had done so without following the required authorization process. Chamber of Deputies president Julio Cesar Valentin says that Deputy Minou Tavarez Mirabal will submit an order for an investigation today. According to Valentin, the councilors' decisions are contrary to the laws and ethics. Listin Diario explains that residents of Los Cacicazgos have been complaining because three towers that are under construction violate the urban residential area's building regulations. The campaign by the residents has put the construction on hold while the authorities mediate the situation.

US$140 and rising
A barrel of crude oil hit the US$140 mark for the first time ever yesterday. The price of fuel is increasing even after Saudi Arabia agreed to increase crude oil output by 200,000 barrels per day by July. This is the second time that the Saudis have agreed to increase production. In May they agreed to up production by 300,000 barrels. The BBC reports that speculation has been to the detriment of oil prices and some believe this could lead prices to reach US$200 per barrel within 18 months. Premium gasoline in the DR is at RD$205.60 and regular gasoline, at RD$196.80, is expected to soon break the RD$200 mark, bringing gasoline to cost in the DR around US$6 the gallon, compared to US$4 in the US. The difference in price is due to the high local taxes on the gallon.
For updates on fuel prices, see http://www.seic.gov.do/default.aspx

Reform on the way?
Is a 2008 "fiscal reform" in the DR on the way? Fiscal reform in the DR is code word for tax increases. Hoy reports that the recent visit by the Managing Director of the International Monetary Fund, Murilo Portugal, could be indicative of more taxes. Portugal explains that all aspects of the nation's fiscal policies must be examined. However, Hoy also quotes Economic, Planning and Development Minister Temistocles Montas's new book "Where We Are Headed: Thoughts on Dominican Development", which suggests that as a country continues to grow, the tax base should be increased in order to create a more progressive tax base. Montas cites the Spanish example, which he says only had an 18.2% tax base in 1975, but increased this to 31.8% by 1985 and 35.1% by 2004. Montas argues that if the country maintained a fiscal deficit similar to the 2001-2004 periods, 1.83% of the GDP, with a growth rate of 2% and a real interest rate on debt of 6% public debt would inflate to 170% of the GDP. Increasing the tax base, nevertheless, could mean just getting more people to join existing taxpayers, not necessarily adding more taxes, or increasing the tax that existing taxpayers already pay.

Deputies do well
Chamber of Deputies President Julio Cesar Valentin has confirmed that Congress members have received a pay increase of RD$58,491 per Deputy since March. Deputies now receive a basic salary of RD$175,000. Including perks and incentives, each Deputy now makes RD$342,568 per month. Previous to the wage increase deputies made RD$116,000 per month. Valentin says that incentives for the Deputies stayed at the same level and that they must now pay income tax. Previously Deputies were discounted RD$43,973 for taxes. Valentin says that he was opposed to the wage increase because of the social inequalities in the DR. Hoy reports that before Valentin's admission Deputies had vehemently denied the wage increase.
In a page 2 editorial, Adriano Miguel Tejada of Diario Libre writes about how unfair the new raise is. He says that at a time that wages for teachers, firemen and workers in general are subject to severe budgetary wage constraints, it is "obscene" that the legislators can freely authorize their wage increases as they feel fit, without doing the same for the people they represent.

Southwest could fly to the DR
In an address to the press during the closing of the 2008 Annual Caribbean Tourism Summit, Alec Sanguinetti, CEO of the Caribbean Hotel Association speculated that Southwest airlines could be interested in flying to the Caribbean. He said that nations that adopt pre-clearance would be in a position to receive Southwest jets. Pre-clearance is a facility that allows passengers to clear US Customs at airports outside of the United States. The speculation came after conference speaker Darryl Jenkins commented that Southwest had appointed a vice president of international routes.
"That is significant. I think it is fair to say Southwest does not take action without knowing where they are going and that they will be able to make money out of it," said Sanguinetti. He pointed out that in these difficult days, Southwest will only fly where it is sure it can turn a profit. "They are hedged at US$50 a barrel through 2010," he explained. "They have cash to do it [open routes to the Caribbean]".
He explained that it is the only airline that has a 10-year labor contract with its crew, and that they have a very efficient fleet. Nevertheless, he cautioned that these low-cost carriers only fly from airports where operating costs meet their model and allow them to fly in and out quickly and turn flights around in 30 minutes. "If instead of half an hour, it were to take a 737 an hour, on their current schedule they would need more airplanes", he explained. He was making the point that only efficient airports would be able to attract low-cost carriers such as Southwest.
Punta Cana International Airport (PUJ) is the local airport that has made progress in preparing for the possible granting of pre-clearance for the next winter season, and could be the first in the DR to offer the facility.

Nestle exits DR ice cream market
Nestle Dominicana S.A. has announced that it will no longer produce or sell ice cream in the country and will stop all ice cream production at its Manoguayabo factory immediately. The company will also stop importing ice cream to the DR. A press release from the company explained that the dominance of a particular brand of ice cream along with competition from other ice cream companies made it extremely difficult to compete and grow in the DR. The press release continues by saying that sales weren't able to grow sufficiently in order to make a substantial profit. This is one of those rare cases of local brands, in this case, Bon Ice Cream, winning out over well-funded international imports. In a company press release, Nestle says that "the market is dominated by an almost 40-year old brand that has strong backing from Dominicans".

Arrest now; ask later
The Attorney General for the National District, Jose Manuel Hernandez Peguero and president of the Human Rights Commission Manuel Maria Mercedes, say that every month more than 2,000 Dominicans are arrested during police raids and thrown in jail without justification. The National Police is beginning a new campaign to inform citizens about their rights. Mercedes welcomed the initiative, but urged the National Police to make sure that its officers respect citizens' rights. He added that these unannounced raids create a certain level of tension, especially to marginalized neighborhoods. Mercedes is asking for this campaign to be implemented nationwide. Peguero added that the illegality of the raids is what led him to support the initiative. Posters will be placed in neighborhoods saying:
If I am arrested I have the right to:
- know who is arresting me, where I am going and why I am being arrested.
- be treated well
- be allowed to talk to a person of my choice or my lawyer
- not answer questions during interrogations
- see the Attorney General immediately
- meet in private with my lawyer.
The poster also explains that if these rights are violated, they can call a hotline, (809) 200-1202.

Office for victims
Dominican Attorney General Radhames Jimenez Pena inaugurated the National Legal Representation Office for Victims' Rights yesterday. The Office will provide legal advice and services to people who otherwise cannot afford it. Jimenez said the office is expected to help the legal system work more effectively. The new office is located on Doctor Baez #16 near the corner of Cesar Nicolas Penson in Gazcue. The office has lawyers, legal representatives, judicial investigators and social workers, as well as other staff.

Almeyda doing well
Interior and Police Minister Franklin Almeyda has been discharged from the University of Miami Hospital after undergoing heart surgery there last week. Henry Castellanos, who has taken over duties while Almeyda recovers, says that Almeyda will remain in Miami for a few more days as part of his recovery. While in the hospital Almeyda received a visit from First Lady Margarita Cedeno, President Leonel Fernandez's mother Yolanda Reyna and other friends.

Dominicans dominate in Cabarete
Dominicans Ariel Corniel, Enmanuel Rondon, Robinson Vasquez, Jean Carlos Paulino, Carlos David Martinez, Alex Soto, Argene Gonzalez, Luis Alberto Peralta, Patrick Mendoza, Kelvin Corniel and Joel Mendoza have all qualified for the finals at the VIII Kite Board World Championships being held in Cabarete, Puerto Plata this week. Of the 16 Dominican athletes who entered the competition, 11 will take part in the freestyle competition this weekend.
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