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Daily News - Monday, 28 July 2008

A focus on the electricity subsidy
Superintendent of Electricity Francisco Mendez says electricity rates may have to go up. He says the higher costs and the rising subsidies to those who do not pay for the service are not sustainable by the government. He said that costs have quadrupled while the electricity rates have stayed the same. According to Mendez, the projected deficit in the energy sector is expected to be US$1.1 billion or RD$37 billion, while the amount budgeted for the subsidy in the electric sector is just US$650 million, plus some US$250 more from other sources. He spoke of a shortfall of US$200 million that the Superintendence of Electricity has to find through savings and lowering of costs, but if this is not possible, then the electricity rates will have to go up. The Superintendence plans to focus the subsidy only on the Program to Reduce Blackouts (PRA), joint purchases of fuels, and a renegotiation of the clauses of indexation that are onerous.

Brazilian ethanol
Brazilian Ambassador Ronaldo Dunlop said that a Brazilian company will be installing a plant to mix ethanol with local gasoline and obtain a cheaper fuel for use in the nation's flotilla of vehicles. The diplomat said at the Presidential Palace that during the initial stages ethanol would be imported from Brazil, but that later Brazilian technology will be used to produce ethanol in the DR.

Romero calls for flexible financing
Duarte Province Senator Amilcar Romero is worried about the lack of financing for farmers. He called for the authorities to ease banking restrictions that impede farmers from accessing credit. A former minister of Agriculture, Romero is the president of the Permanent Senate Commission on Agricultural and Agro-Industrial Affairs. Romero said availability of financing would make it possible for the farmers to incorporate modern technologies.

Today is LPG Day
Industry and Commerce Minister Melanio Paredes said today the government would announce its policy regarding the sale of propane gas (LPG) at gasoline stations. The National Association of Gasoline Retailers, (Anadegas), and the National Association of Distributors of Liquid Petroleum Gas (Asonadigas) are at loggerheads regarding the gasoline retailers' right to sell propane, previously a monopoly of Asonadigas members.
Anadegas bases its legal position on Law 407-72 that provides of service stations to sell "all types of fuel" to the public.

"2 for 1" textile bill
House Ways and Means Committee Chairman Charles B. Rangel (D-NY) and ranking member Jim McCrery (R-LA) today introduced HR6560 to the US Congress. The legislation establishes a "2 for 1" textile and apparel allowance program to be developed and administered by the Secretary of Commerce. Under the program, when producers purchase a certain quantity of qualifying US fabric (2 square meter equivalents or "SMEs") for apparel production in the DR, they will receive a credit (equivalent to 1 SME). This credit can then be used to ship a corresponding quantity of eligible apparel (pants and other bottoms) from the DR to the US duty-free regardless of the origin of the fabric from which the apparel product is made. The provision included in the Rangel-McCrery bill is an expansion of the US-DR-CAFTA trade agreement and has the broad support of US textile manufacturers. DR1 had erroneously reported that the program was already being implemented.
"This is truly win-win legislation," Chairman Rangel said. "This long overdue program will create incentives for the purchase of US textiles, supporting businesses and workers here at home while also providing valuable benefits to apparel producers and workers in the Dominican Republic. It is easy to see why industries in both countries have been supportive of this initiative."
"The United States economy has already benefited significantly from CAFTA, and our trade deficit with the region before the agreement went into effect has now become a trade surplus," said McCrery. He forecast that the new legisslation will provide another opportunity to grow US textile exports and add to the US trade surplus with the CAFTA-DR region."
View the text of HR6560 at http://waysandmeans.house.gov/media/pdf/110/bill157.pdf

Hotels call to end transport monopolies
The National Association of Hotels & Restaurants wants free competition for transport services. In a press release, the leading hotel organization says that the present government policies that allow for monopolies in the transport industry affect the quality of ground transport to the tourist zones.
"The development of the country, the right of citizens to efficient transport service and the consolidation of the tourism industry demand that there be freedom to do business in the transport sector," stresses Asonahores.
Asonahores says that the Office of Ground Transport (OTTT), the government authority in charge of regulating ground transportation routes, violates the Constitution when it bans a company from competing on a route after the legal requirements have been met. The case of Caribe Tours has been making headlines after OTTT rescinded its right to transport passengers on the Santo Domingo-Santiago-Dajabon-Cap Haitien route under pressure from small commuter companies.
El Nacional denounced that OTTT has banned Caribe Tours from also carrying passengers on the new Samana tolls highway. Asonahores called the decision "unheard of."
The hoteliers say that important tourist areas are underserved with inefficient and low quality transporters that receive the protection of the government.
Asonahores says that it is absurd that organizations such as OTTT instead of protecting the interests of the communities and passengers become accomplices to those who resort to illegal and violent methods to maintain the monopolies in violation to the Constitution.

Chevron accepts mediation
The Chevron-Texaco Company announced Sunday that it had accepted President Leonel Fernandez's suggestion that they initiate a dialogue with the Mediating Commission that was assigned to the case of the Association of Petroleum Transporters (ATP) and the the Autonomous Syndicate of Petroleum Transporter Chauffeurs (SACTPA). Chevron said that "as a result of the intervention of the President, a person well versed in the laws of free commerce and the guarantor of the rule of law, and his request to Chevron, we will participate in the talks that will take place on Tuesday, 29 July at the Presidential Palace with the understanding of the need for the government to maintain a climate of stability and social tranquility." At Chevron's request, and with the authorization of the Mediation Commission and the President, the renowned mediators Celso Marranzini, Monsignor Agripino Nunez Collado and the Reverend Manuel Estrella will attend the meeting.
The company also thanked the business sector and the media for their support of the company's stand that they highlighted was one based on constitutional rights that were confirmed by a San Cristobal court decision.

Charge cards charged
Expect to pay a fee soon, if the Association of Gasoline Retailers (Anadegas) makes due on their announcement of adding a fee to credit card purchases of gasoline. Juan Ignacio Espaillat, spokesman for Anadegas said they will charge the fee to compensate for rising financial and operating costs, such as payroll, fuel costs for generators, electricity, security, among others. Espaillat said the charge will be applied as of 17 August. Credit card sales only make up 4.9% of all gasoline sales but they cost 2%, according the Anadegas boss.

Cibao has serious energy issues
According to the Electricity Distributor EDE-Norte, there are 50 circuits in the network that are out of service. The San Felipe plant (formerly Smith & Enron) went offline and this practically turned off the lights in the whole northern part of the country. According to the El Caribe, there are 16 and 18-hour blackouts in parts of Santiago, Monte Cristi, Mao, Santiago Rodriguez, Mao, Moca, San Francisco de Macoris, Bonao and La Vega. There were protests is several places when the people took to the streets to protest the deteriorating electric service. Yesterday, the CDEEE reported that the 180-megawatt San Felipe system went off line once more after returning online with just 70 megawatts. As the blackouts increase, so do the complaints from clients, that are protesting the higher electricity bills, despite the blackouts. All sorts of small businesses are complaining that the blackouts are ruining their livelihoods. Neighborhood watch groups are also worried due to the increase in robberies and assaults in the darkness throughout the region.

Lower crude prices not at pumps
Oil prices have dropped around 20% on the world markets but fuel prices are not keeping pace. The Hydrocarbon Law is clear on the subject when it says that domestic prices will follow the prices of the international markets. Over the past 15 days, oil prices have fallen by 20% and local prices have fallen 3%. For example, premium gasoline reached RD$208.80 per gallon when oil reached its highest price. However, after a 20% reduction in the commodity price, the local price fell to just RD$204.10. Other fuels have shown similar small reductions in prices.

You don't have a 50/50 chance
If you get married, there is a better than 50% chance you will get divorced. According to Father Luis Rosario, the national coordinator for youth guidance for the Catholic Church, more than 50% of those that get married, get divorced, and this does not even count the thousands that live in common law relationships and separate. The priest added that this is one the main problems that families have to confront. He said that there are a lot of people that come together for one night, for one week for one year, and, naturally, they leave behind children that are going to grow and develop without enough to eat and live, and without the most elementary need of any human being, love. Father Rosario said that the disintegration of the Dominican family is an issue that has to be addressed by the government, by the parents and by all sectors that act in society. The priest spoke to reporters before participating in the ceremonies surrounding the launch of the "Plan of National Public Policy 2008-2015" at the Ministry of Foreign Affairs.
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