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Daily News - Tuesday, 05 August 2008

New cedulas on the way
Next year the Central Electoral Board (JCE) will issue new ID and voting cards (cedulas) with the fingerprints of more than eight million Dominicans embedded in the document. The new cards will be less vulnerable to forgeries and will carry more information about the holders. JCE Administrative Chamber president Roberto Rosario said that JCE officials are advanced on the plans for the new technology to be implemented next year.

PRA program update
During the first seven months of the year the government spent US$49 million, or RD$1.7 billion, on the Blackout Reduction Program (PRA), a program that stipulates fixed low charges for electricity in low-income areas. Through the program, 482,000 families have signed up to receive subsidized electricity. According to state electricity corporation officials, 96,000 houses that are billed at the fixed rate do not qualify for the subsidy. The director of the PRA, Antonio Herrera, says that the eliminating of these 96,000 households will bring savings of RD$48 million. He explained that the fixed charge should only benefit the poorest families and that the program is being restructured with this in mind. A report in Hoy says that households consuming less than 700 kWh a month qualify for reduced variable rates. At present, households consuming more than 700 kWh need to pay more than double than those consuming less.

Fitch favors higher power rates
Fitch Ratings has published a special report today on the Dominican Republic electricity sector, according to BusinessWire. Fitch says that "with the sector teetering on the brink of financial distress, investors are again asking if the recently re-elected Fernandez administration now has the political will and conviction to fix the system."
The report points out that the stand-by agreement with the International Monetary Fund (IMF), which provided a framework for the sector to reach financial self-sustainability while providing a more efficient, reliable and cost conscious electric service, expired January 2008 and has yet to be renewed. "Unfortunately, little was achieved during the period the agreement was in place," it observes. The report indicates that so far, the re-elected government seems to be taking an approach that is likely to perpetuate the sector's instability, rather than to eliminate market distortions and enforce the new electricity law.
Meanwhile, Fitch points out that rolling blackouts and electricity shortages have again become a way of life for people in the Dominican Republic. Extremely high electricity losses, the vast majority from theft, and low collections from end users have plagued the sector and resulted in perpetual electricity shortages.
It stresses that although the country has more than sufficient generation capacity to meet total demand, the government's decision to cap electricity prices, tolerate theft by end users and give free electricity has resulted in insufficient funds for state-owned electric distribution companies to cover their operating costs and pay private sector generators for contracted capacity.
The report, nevertheless does not mention other problems with the system - such as clientelism that has padded electricity organizations with unnecessary employees, privileged contracts for purchasing of fuel supplies and electricity, among other factors that would require political will for a change.
Fitch points out that the government has met the challenge of soaring oil prices by increasing subsidies, with taxpayers picking up the tab for clientelism and inefficiency within the system. Fitch advocates for an increase in tariffs, which are already twice as high as in competitor countries, such as Central America.
The full report titled "Dominican Republic Electricity: On the Edge of Darkness" is available on the Fitch Ratings web site www.fitchratings.com

Action in Bani dunes case
Environment Minister Omar Ramirez says that he has suspended the manager of the Dunes of Bani protected area, Felix Lara after it was determined he was negligent in his job. Listin Diario reported that trucks constantly load sand from the dunes. Ramirez said that he had appointed two additional park rangers, and that Isaias Fuentes would temporarily replace Lara. He confirmed that numerous extractions had been carried out at the points of Matanzas and Arroyo Hondo.

Not enough money
Hacienda Minister Vicente Bengoa says that the UASD University, municipal governments or public sector doctors should not expect to receive additional funds through the Supplementary Budget being reviewed in Congress. Interviewed yesterday, Bengoa said that "everything in life is possible, but if you asked in terms of percentage if that is possible, I'd tell you that it is 99% impossible that they will get more funds."
Bengoa made his comments after meeting with the bi-cameral commission at Congress to discuss details of the budget. The UASD is asking for an extra RD$325 million, while municipalities are asking for RD$3 billion to cover the 15% increase in worker salaries that President Leonel Fernandez announced during his address to the nation last month. With regards to the budget, Congress is asking the government to identify, through an addendum, the source of the funds that will be used to recapitalize the Central Bank in January and February 2009. However, Bengoa says the government had already advanced half of the allotments towards the quasi-fiscal deficit earlier this year, and wants to postpone the second payment for next year.

Moving towards the dollar?
Hacienda Minister Vicente Bengoa believes that the dollarization of the Dominican economy is a distinct possibility. The minister, speaking to reporters after a meeting at Congress, explained that the Dominican economy is practically dollarized. "Everyone thinks in dollars," Bengoa said. He explained that when someone goes to buy an apartment, the sale and the contract are calculated in dollars, as is the sale of cars or the import/export of goods and services. The Minister said that contracts are based on dollars. "Considering this, I would imagine the only thing left is for the dollar to circulate as legal tender instead of the peso." Bengoa's comments aren't far from truth as some establishments have already begun to mark their items with US dollar prices and accept dollars for the purchase of these items. However, for full dollarization, the Constitution would have to be reformed.

Nuria & Huchi: Nunez lied
Nuria Piera and Huchi Lora are questioning the veracity of tests results on the Ladom school breakfast supplies that were presented last month by press secretary Rafael Nunez. At a press conference called at the Presidency in July, Nunez presented the test results, as government "proof" of the quality of the Ladom public school drinks. At a request from Piera, the press officer indicated that the Ladom test was from a remote school in the mountains of San Cristobal. The results of that test were considerably better than the results presented in the original tests carried out by Nuria Piera in May. The test, nevertheless, still did not meet the written requirement of the Ministry of Education for school breakfast drinks.
After traveling to the remote Zumbi school in La Loma, El Cacao, San Cristobal, Piera says the press spokesman for the Presidency lied. In a televised interview with the principal, he denied that anyone from any government department had visited the school to take samples of leftover milk. Furthermore, he said on the TV interview that they do not keep old samples and rather give the surplus inventory away because rats can enter their temporary storage facility.
As reported in El Caribe, Piera says that it would be necessary to determine where the samples came from and that if they were taken from the Ladom production plant, it would be proof of complicity between the factory and the Ministry of Education and its Department of Student Welfare.
The school principal presented a notebook where he kept the record of moving the inventory. Based on this, the journalists are disputing that the results of the milk from San Cristobal that was tested for the Nunez press conference could have been inventory dating back to March. Piera and Lora speculated that the government probably assumed that the journalists would not make the long journey up the mountain to the school to verify the information.
The journalists also questioned why the President's press secretary took on the defense of the private company. They are asking the company to produce lab tests for their samples for dairy supplies prior to May 2008, but this has not been forthcoming. The journalists said they have now resorted to the law of access to public information and have asked the Ministry of Education to release all test results carried out to drink samples since the start of the year. The director of the governmental Institute of Biotechnology and Innovation said earlier in an interview with Lora that these tests had been carried out periodically by the IIBI.
Piera also ascertained that following the TV program where she exposed the low quality of Ladom school breakfast supplies, the company stopped supplying the dairy product, replacing it with juice supplies at the San Cristobal school and several other public schools, in violation of Ministry of Education minimal protein level requirements. Piera pointed out on the show that juice does not have any protein content.
Piera and Lora expressed their concern that the school principal could be removed from his post for telling the truth. Piera and Lora say that since the May program exposing the low quality of Ladom supplies, the company has not been able to produce a single lab test that can prove they have met Ministry of Education written requirements.
Ladom recently announced that it would sue the journalists for their statements, which they say are affecting their sales. The Ministry of Education allotted Ladom 40% of school breakfast drink supplies for the past school year, Piera reported, making it the largest supplier to the government. This is a RD$18 million a month government program.
Rafael Nunez, the Presidency press secretary, has not responded to later inquiries by the journalists about the contradiction between the school lab tests presented at the press conference and statements by the principal that no one had sourced the samples at the school. Speaking on yesterday's afternoon CDN talk show, Piera told Lora that this could be a case of "deceit with capital letters."
For the videos of the case as presented by Nuria, see www.nuria.com.do

Supreme Court on lynching
Supreme Court Judges are denying that they are responsible for an increase in crime and the cases of criminals lynched by citizens in the DR, as Police Chief Rafael Guillermo Guzman Fermin claimed. Yesterday, Guzman attributed the recent spate of lynching to leniency on the part of the justice department towards criminals and robbers that sow fear and despair among the citizens and has led many to take "justice" into their own hands. "The lynching is the product of legal impunity and I have said that several times before," said the Police Chief. Supreme Court judges Hugo Alvarez and Julio Ibarra Rios rejected Guzman's point of view and said that his comments reflected a lack of understanding of the problems regarding the issues. Ibarra Rios, visibly bothered by the Chief's comments, was firm in saying that Guzman should study law before he makes that kind of comment about the justice system. "He needs to study law because all he is a civil engineer." Supreme Court president Jorge Subero Isa tried to mediate by saying that Guzman passed by the judge's office and explained that he wasn't referring specifically to the justice system, but to society as a whole. Subero Isa said, "I think he has a point because if all the State's resources were directed towards fighting the evils in our society, the situation would be different and there would be no impunity."
Congress is studying changes in the Penal Code. Lawyers have indicated the law makes it very difficult to press forward a case against a criminal, even if the later is caught committing the crime.

Money laundering brothers update
Dominican officials say that the Benitez brothers, accused in a US court of a million dollar scam against the US Medicare system, have managed to escape from the DR where they had invested millions of dollars, most in tourism-related businesses and real estate that has been confiscated by the local authorities. German Miranda Villalona, director of the Money Laundering Unit, says they do not know exactly how Carlos, Jose and Luis Benitez could have escaped from the country or where they are. Miranda says that Interpol would continue to be on the lookout for the brothers regardless. Officials say that over 60 people have been connected to the Benitez brother's scam.

119 dead in July
A total of 119 Dominicans died in July - 18 less than in June. According to statistics, 63 of those deaths were homicides, 12 were accidental, 6 were suicides and 32 were due to natural causes. An additional six deaths are undetermined. Of the total deaths, 89 were Dominicans, 16 were foreigners, 14 were unknown and of the total 95 were men and 24 were women. The week of the 20th seemed to be the deadliest with 48 people dying that week.

Dominican aspires to Bronx seat
Nelson Castro, who emigrated from the Dominican Republic to the United States as a child, looks to become the first Dominican elected to the State Assembly for the Bronx. The 36-year old Castro is facing Mike Soto during the 9 September primaries. Traditionally the candidate who wins the primaries goes on to win the elections in November. Castro was born in the Villa Juana sector of Santo Domingo and has lived in the Bronx for four years. An estimated 350,000 Dominicans live in the Bronx.

Millions for medalists
For the first time ever, Dominican athletes who win medals at this year's Beijing Olympics will receive multi-million cash bonuses. Sports Minister Felipe Jay Payano says that an athlete who wins gold will take home RD$7 million pesos while silver winners will receive RD$5 million and bronze winners RD$3 million. The Dominican Olympic delegation is 25 athlete-strong and is the best trained Olympic delegation in many years. In a ceremony yesterday at the Beijing Olympic Village, the Dominican flag was raised to join the record number of nations participating in the Olympic Games. Olympic delegation president Juan Vila thanked the Chinese people for their welcome and guaranteed a high quality performance from the Dominican team. Dominican athletes will be competing in nine different events. There are hopes for medals in sailing, track and field and boxing.

Super Sanchez not sure
Dominican track star Felix Sanchez is not sure if he will compete in the upcoming Beijing Olympics. Sanchez has been battling a series of nagging injuries that have halted his once electrifying career. Sanchez says that unless he is 90% recovered, he will not compete in Beijing. Sanchez, who is currently in South Korea, is hoping that his left foot heals properly before the Games. Sanchez's first race will be on 15 August during the first round qualifying events and it is on that day that Sanchez will decide if he races or not.

Hollywood home for Manny
Former Red Sox slugger Manny Ramirez is feeling right at home among the bright stars in Los Angeles. Ramirez, who weaseled his way out of Boston through temper tantrums and management bashing, seems comfortable in his new digs. The slugger went 4-5 on Sunday with one homerun and three RBI's, helping the Dodgers top the Arizona Diamondbacks. In all Ramirez went 8-13 during the weekend stand with 5 RBI. Ramirez also had his first four-hit game since 1 June 2007, making Los Angeles fans extremely happy about their near future with Ramirez. All will be fine and good as long as Los Angeles can keep their latest prima donna star, Ramirez, happy.

Rains will continue
The National Meteorological Office says that rains will continue over the DR today and tomorrow. Warnings have been released for residents of Santiago Rodriguez, Dajabon, Valverde, San Juan, Maria Trinidad Sanchez, Samana, Duarte, Monte Plata, La Vega, Monsenor Nouel, Sanchez Ramirez and Elias Pina. People living near rivers and streams have also been warned about flooding.
 
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