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Daily News - Tuesday, 30 September 2008

Commerce Secretary Gutierrez visits
President Leonel Fernandez met with US Commerce Secretary Carlos Gutierrez at the Presidential Palace yesterday. After a private meeting with Gutierrez, President Fernandez held discussions with the business mission that accompanied him, US Ambassador to the DR Robert Fannin and Dominican Labor Minister Jose Ramon Fadul. Gutierrez visited heading a business mission that included representatives from Best Buy, Cell Gate USA, Waitex Group of Companies and Home Depot. These companies have shown an interest in establishing branches in the DR.

Reflecting on DR-CAFTA
The DR is the leading US trading partner among the DR-CAFTA member nations and was the sixth largest in Latin America in 2007, according to US Commerce Secretary Carlos Gutierrez. According to Gutierrez, exports from DR-CAFTA nations increased by 18.5% and bilateral trade between the US and Central America towards the DR increased by US$10 billion since the implementation of the agreement. Gutierrez highlighted the DR's trade growth since 2005, adding that it is difficult to find another country with a comparable growth rate during that same period.
However, Gutierrez says the trade deficit between the DR-CAFTA nations and the US was US$3 billion in 2007. The DR shows the highest trade deficit among the agreement's signatories. Gutierrez attributed the large deficit to the decline that textile exports have been experiencing since 2005, saying that this is linked to the shift in apparel manufacturing to China, and not a consequence of DR-CAFTA. Gutierrez argues that the situation would have been worse without the DR-CAFTA agreement.
To give an idea of the strength of the Central American market for the US, he commented that trade with DR-CAFTA countries is almost at the same level as with India and Russia.
He made his comments at a breakfast meeting organized by the Chamber of Commerce of Santo Domingo and as guest speaker at an American Chamber of Commerce luncheon.
DR-CAFTA has seven signatories: the United States, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua. The DR-CAFTA region is the 3rd-largest export market in Latin America and the Caribbean, and the 14th-largest market in the world for US exports. Nearly half the region's imports come from the United States.

Competitive edge
US Commerce Secretary Carlos Gutierrez has urged the DR to redouble efforts to increase transparency and consistent application of the law as a way of enhancing the nation's attractiveness for foreign capital. The Secretary explained that as the economic crisis develops, competition for foreign capital would become fiercer. Gutierrez did highlight the silver lining in this financial crisis, saying that a rise in fuel prices would benefit the DR as manufacturing companies would prefer the proximity of the DR to shipping from Asia. Gutierrez made his comments during speeches as part of a business development mission to the DR. The mission seeks to highlight regional opportunities under the DR-CAFTA agreement. Gutierrez is leading a business delegation of nine US exporters from eight cities in seven states representing a wide range of industries that will travel the region from 28 September to 2 October 2008.
In related news, President Leonel Fernandez says that in these tough economic times his government should be more transparent, competitive and efficient. Fernandez made his comments in a recent issue of "Gestion & Competitividad." In the article Fernandez states that governments should be agile and flexible in response to the constant changes in the financial markets as a way of curtailing possible pressures on the Dominican economy.
President Leonel Fernandez said that the new adverse international order and the increase in oil and food prices require government to be efficient, competitive and transparent. He said the government cannot be the exception and needs to be competitive in order to play its role as economic agent and promoter of development.

DR banking "solid"
Economist Bernardo Vega is in favor of the Dominican government signing an agreement with the International Monetary Fund as a way of demonstrating willingness to tighten its belt in order to tackle the difficulties that the economic crisis in the US will bring. "There is no real perception that the government is tightening its belt to confront the situation in the United States," he told Huchi Lora's CDN Radio talk show. He said the signing would restore confidence and reiterated the need for the government to reduce public spending.
Vega does not foresee problems with Dominican banking, despite the US financial crisis. He said that after the Baninter bank fraud scandal, rigorous regulations were instated aimed at keeping banking in order. He did say, however, that banks should be wary of receiving "hot money," and lending this out. Nevertheless, he predicted that there would be a decline in investment and exports of goods and services, as the market goes soft in the US.
Vega called for observing parallels between how the US and Europe are dealing with their own bank crisis and how the DR dealt with its own.

Broadband expansion
Codetel, in cooperation with the Dominican Telecommunications Institute's (INDOTEL) Rural Broadband Connectivity Program, will expand broadband internet service to 509 rural communities throughout the DR. Indotel director Jose Rafael Vargas says that within 343 days communities in Arenoso, Castillo, Villa Riva, Duarte, Comendador, Moca, Punta Cana, La Vega, Bonao, Monte Plata, Yamasa and Puerto Plata will have broadband service. Codetel president Oscar Pena Chacon says that so far the program has brought broadband to over forty communities. According to Vargas the goal is to bring broadband service to 2,000 communities across the country.

Army evokes patron saint
During celebrations in honor of the Archangel St Michael, President Leonel Fernandez asked the Army to continue fighting against drug trafficking. St Michael is the patron saint of the Army. Fernandez's words were read during a mass celebrated at Santo Domingo Cathedral. Also attending the mass were Vice President Rafael Alburquerque, Armed Forces Chief Pedro Rafael Pena Antonio, Army Chief Joaquin Virgilio Perez Feliz, Navy Chief Julio Cesar Ventura Bayonet, Air Force Chief Carlos R. Altina Tezanos and Police Chief Rafael Guillermo Guzman Fermin.

Drugs from Colombia
The increase in drug activity in the DR can be attributed to an increased presence of Colombian drug cartels using the country as a springboard for drug operations. During the first ten months of the year, 83 flights were detected entering the DR illegally with the aim of dropping drugs on national territory. According to Diario Libre, an average of 15 illegal flights enter Dominican airspace each month. The newspaper reports that during this same period the authorities arrested 403 Colombian nationals with ties to drug trafficking and 32 Colombians have been murdered in drug related incidents. This includes the four men who died in a plane crash in the mountains of Pedernales last week. Diario Libre states that this increase in drug trafficking activity is putting national security at risk.

Fighting drugs
Over the weekend drug control agents seized over 154 kilos of drugs in separate drug raids. Thirty-three packets of drugs were found in Higuey after a gun battle between the authorities and suspected dealers. One man was shot dead in the violent exchange. A further 75 packets of drugs were found during an operation at Las Americas International Airport (Santo Domingo), while twelve packets were found at Punta Cana International Airport. Officials say the drugs originated from Colombia. Drugs raids continued across the DR including Azua, where 23 packets of drugs were found. The Navy reported the dismissal of three officers for ties to individuals linked to drug trafficking - Genaro Silverio Balbuena, Felix Acosta and Pena Figueroa, as reported in Hoy.

Guerrero repeats call for probe
Senator Wilton Guerrero says he is surprised that General Prosecutor Radhames Jimenez Pena is accusing him of the same things as the former Police commander in Bani, General Hilario Gonzalez y Gonzalez. Senator Guerrero has accused General Gonzalez of complicity with drug traffickers in the region. At a press conference yesterday, Senator Guerrero said his son Francisco Alberto Guerrero Melo had been arrested in New York for a traffic accident for which his friend, who was driving the vehicle, was fined US$150. Proof that his son was not involved with drug trafficking activities is reflected in the fact that he was granted US citizenship this year. In response to accusations made by Guerrero of negligence in investigating drug cases, Jimenez said that it was Guerrero who should be investigated for his fortune and for his son's behavior. Guerrero showed a court report on the traffic incident. He said that Jimenez was welcome to investigate the source of his wealth, referring him to documentation at the Controllers Office and Chamber of Accounts on his management of the Dominican Agrarian Institute during President Fernandez's first term of office. He repeated his call for a more thorough investigation into the killing of seven suspected drug dealers in Bani last month. "This is the right time to reiterate the call that we have been making to the Prosecutor since the events in Paya: take on your responsibility as chief prosecutor and investigate in depth and with the sufficient rigor so that the truth may come out, no matter who is sacrificed, or which altars are taken down," said Guerrero, as reported in Diario Libre.

Complicity of the authorities
Lawyers Carlos Salcedo and Artagnan Perez Mendez are also warning that the complicity between the authorities and drug traffickers and the failure to apply the law are contributing to the increase in crime in the Dominican Republic, as reported in Hoy. Salcedo said that the increase in crime and drug trafficking is a reflection of the weaknesses shown by the complicity of the authorities with criminals. Artagnan Perez Mendez said, "I don't think we are taking the necessary measures to effectively fight crime and drug trafficking". He said that crime levels have increased because of the moral complicity of the authorities in charge of prosecuting crime. He said that where there are men there will always be crime, but added that an organized society has the duty to fight it, "whatever the cost or the consequences." Perez complained that the laws exist to fight drug trafficking and crime but are not applied in full.

Senator calls for DNCD office
Pedernales Senator Dionis Sanchez is calling on the government to set up a National Drug Control Department office in Pedernales, on the far southwestern coast of the DR. He said that after last week's incident in which an airplane loaded with drugs crashed in a remote area of the province, he has observed more activity by drug agents in the area. Sanchez said that Pedernales is on the border with Haiti, has long stretches of beach and uninhabited and inaccessible land, which translates into a need for the DNCD officers to be more active, he told Hoy.

Increasing warning for flooding
The Stevens Institute of Technology's Center for Maritime Systems has launched a project aimed at strengthening the Early Warning System (EWS) for Floods in the Dominican Republic. The project is focused on developing the DR's EWS technology and providing the most up-to-date equipment to improve accuracy in detection of hurricanes and preventing flooding. The program is the brainchild of Dr. Harold J. Raveche, President of Stevens, and was drawn up with the help of Dr. Alan Blumberg, Dr. Thomas O. Herrington and Janet Kunhardt. The importance of an EWS in the DR cannot be overstated. Many deaths occur each year due to drowning in the wake of powerful tropical storms and hurricanes in the DR. Proposals for funding have already been sent to USAID and the United Nations Development Program (UNDP). According to Blumberg, if this program is successful in the DR it could be replicated in other Caribbean nations. Eileen Parra, a Dominican engineer who is working on the initiative says it could take up to five years for the EWS to be fully operational in the DR.
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