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Daily News - Thursday, 30 October 2008

Nobody knows budget details
Most of the country's business leaders are in the dark about the details of a proposal sent by the Executive Branch and currently in Congress, aimed at financing the Central Bank's estimated budget deficit for this year. The presidents of the National Business Council (CONEP), Lisandro Macarrulla, the Young Entrepreneurs Association (ANJE), Pablo Piantini Hazoury, and the Federation of Industrial Associations (FAI), Ignacio Mendez, were contacted by journalists and asked about the proposal, and they all said that they did not know about the legislative details, and could therefore not make any comments. Nonetheless, El Caribe quotes former CONEP president Celso Marranzini Perez as saying that if the credits that the central government plans to take to finance the budget deficit are used for investments, it would generate enough to pay for these financings, then he was in agreement that they should be taken, but if they are used to cover normal expenses, it would not be convenient. The Executive Branch sent a legislative proposal last Monday, 27 October, that would allow for the central government's budget deficit to be financed through an increase in the financial sources of the Income Budget and the Law of Public Spending for 2008. The submission of the proposal is apparently in response to a decrease in government income this year. Since January, and up to 20 October, according to Ministry of Hacienda data, the government's income totals were RD$12.412 billion less than expenditures. Up until 20 October of this year, in comparison with last year, the government's total expenditure increased by 32.4%, and income increased by only 6.4%. Over the period under analysis, expenditures totaled RD$212.44 billion, while in 2007 they were just RD$160 billion for the same time period. Income went from RD$188 billion to RD$200 billion in 2008.

Deputies denounce US pressure on drug planes
Chamber of Deputies president Julio Cesar Valentin has confirmed that his fellow party members are under pressure from the United States to reject the bill that would permit the shooting down of aircraft suspected of carrying drugs into Dominican territory. Valentin said that, just like the Dominican Foreign Ministry, Chamber of Deputies members have received a letter from the United States government that warns of a suspension of assistance and support in combating drugs in the country if the proposal becomes law. The legislator told reporters from El Nuevo Diario in Santiago that this is 'unacceptable' behavior by the United States, since no country can tell another country what to do. Nevertheless, the Congressional leader, a PLD member, favored the approval of the bill despite the threats. According to Valentin, the assistance that the US gives the Dominican Republic to help fight drug smuggling is minimal and does not have the desired effect on reducing the problem. According to the annual report that the Department of State published last February, during 2007 the Dominican Republic "experienced an increase in airborne contraband coming from Venezuela, while the maritime cargos continued to arrive using fast boats and containers." The US authorities say that the number of flights carrying drug contraband from Venezuela towards the island of Hispaniola increased by 38% between 2006 and 2007 and "approximately two thirds of those flights were to the Dominican Republic."

Labor Minister asks for salary pact
Minister of Labor Max Puig has asked Trade Unions, as represented by the CNUS, and private sector managers to get together and seek an agreement on a general increase in the minimum wage, which he described as 'a legitimate demand'. As reported in El Nuevo Diario, Puig reminded reporters that management has said that there was an agreement on salaries two years ago and by law, discussions can re-start in March 2009, when salaries can be reviewed and increased. Nonetheless, Puig understands that the current exceptional circumstances could lead to an increase in wages, namely the economic crisis and the lower purchasing power of current salaries that is making life so difficult for lower paid workers. For this reason he urged management to meet with labor leaders as soon as possible to find a solution. At the same time, the minister pointed out the need for a solution to this conflict, understanding as he does that the private sector needs a salary increase, as the public sector is enjoying a 15% salary increase made by the government, and the private sector has still not even made an offer to their workers, who really need the money. As part of their pressure to secure higher salaries, representatives of several workers' unions submitted a legislative proposal to the Senate for a law that would establish a 40% wage increase for everyone earning RD$20,000 or less per month, and a 25% increase for those earning more than RD$20,000. The proposal was received by the Senator from Elias Pina, Adriano Sanchez Roa during a meeting in his office. The meeting was attended by representatives of some of the country's main labor organizations including Gabriel del Rio Done of the Autonomous Union Confederation (CASC) and Jacobo Ramos of the Dominican Workers Confederation. Sanchez Roa called the proposal acceptable and appropriate and said that it would be sent for study during next Tuesday's session of the Senate Salaries Commission.

Economist EIU report lowers DR rating
The Dominican Republic was included in the list of five of the 20 Latin American and the Caribbean countries that have had "major setbacks" in their strengths and weaknesses on the business scene, according to the Microfinance 2008 report developed by the Economist magazine's Economic Intelligence Unit for the Inter-American Development Bank's Multilateral Investment fund and the Andean Development Corporation.
The country fell from the fifth to ninth spot among the first fifteen and according to the report the main reason lies in the area of institutional development, which fell by 25 points in 2008 in relation to 2007. The index analyses the investment climate, the development of public institutions and the regulatory frameworks for microfinance. It was presented in Paraguay within the working sessions of the Forum on Microfinance, organized by Fomin on 8-10 October 2008.

Businesses should put competition aside
Former head of the National Business Association (CONEP) Elena Viyella de Paliza has presented reporters with the idea that all the country's economic sectors should get together and thrash out the solutions to the main problems affecting the DR. Speaking to reporters from Hoy newspaper yesterday, Viyella said that the country is facing very big challenges and issues that merit everyone's participation in order to find the solutions needed. She mentioned issues such as how to make the most of the international trade agreements the country has signed, questions of competitiveness and, of course, the electricity problem. She also expressed her opinion that the Dominican economy has to take the fiscal measures that may be necessary at this time and it has to deal with the so-called hidden costs. Regarding the electricity sector, a field in which she is involved, Viyella said that the nation has to solve this problem, which she described as a recurring one. Viyella commented that this vicious circle needed to be broken. She said that blackouts were linked to the generators' inability to import the fuel needed on time, due to the lack of on-time payments that the electricity distributors have to make. Viyella recommended a pact between all the sectors linked to the economy to solve these and other problems. Commenting on the so-called "hidden costs" she mentioned the fact that the electricity generators have to produce the electricity they consume on an individual basis, and this represents a hidden cost for them, affecting their competitiveness. In her opinion the country has not taken advantage of the free trade treaties due to internal competition.

DR at TCI conference
The Dominican Republic presented an overview of its competitiveness focus to the plenary assembly of The Competitiveness Institute Conference in Cape Town, South Africa on Wednesday, 29 October. Jaime Moreno, advisor to the National Competitiveness Council spoke of the priority that has been given to developing ongoing dialogue and trust for building social capital to foster economic development. Also attending for the Dominican Republic are Maria Victoria Abreu of the National Competitiveness Council and Dolores Vicioso of DR1.com
The DR case was chosen along with those of Singapore (Asia), Canada (North America) and Mauritius (Africa) as an example of dynamic country efforts. The presentations were part of a panel discussion following expositions by Professor Christian Ketels of Stockholm School of Economics and Harvard Business School and Kevin Murphy, president of JE Austin Associates on innovative clusters as the core building blocks of a modern economy. During the presentations, Christian Ketels stressed that quality of cluster policies is more important than push and intensity of cluster efforts, focusing on a stand for quality rather than quantity. Kevin Murphy presented a concise checklist for a competitiveness framework.
The TCI conference began on Tuesday with a keynote speech by former Prime Minister of Finland and vice president of Nokia, Esko Aho who challenged governments to be prepared to take risks and accept that when innovating to change the course of a nation, results will come slower, but it will be an investment in the future. Aho advised them to be aware of only replicating success stories, stressing that the success stories of today can be the failures of tomorrow in this rapidly changing world marked by connectivity and deep global interdependence. He warned politicians that at times of crisis they should not just think of the next election, because that would be a short-term focus, when what is needed is a long-term focus to achieve development goals. He also said that "Now is the time to make investments for the future in environmental and energy solutions." He concluded: "In the world today we need less innovative solutions in the finance sector and more in real economy."

Clinics might cancel contracts with ARS
Private clinic owners told Listin Diario yesterday that they are thinking about canceling the contracts they have with six Health Insurance Providers (ARS) to provide health services to Family Health Plan (SFS) members. Rafael Mena, the head of the Association of Private Clinics (Adeclip) said that the system has not complied with the Social Security Law with respect to the sixth month revision of the clinics' earnings in relation to the country's inflation rate. He revealed that this decision could be taken as early as next Tuesday during an Adeclip membership meeting. He said that the clinics are the only institutions in the system that have not profited from the SFS and that they are currently losing between 12.5% and 14% from last year. He pointed out that other actors in the system have profited and the system has a surplus.

AMET's occupational hazards
Over the last three months, 49 members of the Metropolitan Transport Authority (AMET) have been injured in traffic accidents, hit by drivers after breaking Traffic Law 241. The agents were hurt while directing traffic on the avenues of Santo Domingo and in other cities in the country, according to a press release from the AMET Public Relations Office. The note points out that some drivers who were ordered to stop after breaking traffic laws, "instead of stopping, decided to run over the AMET officer and flee." There were 21 incidents in August, 18 in September and 10 so far this month.

Six wonders of the Deep South
More than poverty and desert, the southwest of the Dominican Republic has beaches with spectacular crystal clear waters, greenery and red evening skies. "What are you going to the south for?" This is the question most people ask when someone says that they are planning a vacation there rather than the idyllic east or the verdant north. The answer lies in the fact that many only know about this "arid and dry" facet of the region. But the southwest is much more than just poverty and desert: It is home to beautiful vegetation, blue beaches and glorious evenings. You don't believe it? Franklin Marte's photos show you the "Six Wonders of the South, as selected by us (Hoy newspaper) during a recent trip.
See: www.hoy.com.do/vivir/2008/10/29/253245/Las-seis-maravillas-del-Sur-profundo
The six wonders are: Bahia de las Aguilas, Hoyo del Pelempito, Blue Coast of Paraiso, Lagoon at Oviedo, Sierra de Bahoruco National Park, and the Green Mountains, blue skies and clear waters.
"The people of the region are another thing. People from Azua are optimistic. During our trip through the south we found some very interesting people. Among these was Antonio, with whom we spoke as we made a brief stop in Azua. We asked, "How are things here?" And he answered, "Better than 40 years ago, now we have streets." Then we met the little guide. As we looked at the lagoon in Oviedo, suddenly there was Adrian, eight years old. He came closer and said 'You know, this lagoon measures 1,374 square kilometers and of these 905 are marine...' and then continued with his tour. Although with feelings of nostalgia mixed with sadness, Awilda, who lives in the little town located at the entrance to the Bay of Aguilas, tells us that the place has neither electricity nor running water, but she says that she is proud to be living in such a beautiful place".

Baseball updates
The Toros halt skid and beat Licey 8-4. The Toros took advantage of horrendous pitching to win the game. Licey left 10 runners on the base paths. With the victory the Toros climb to within half a game of first place in the standings.
In Santiago, the Aguilas, with a homerun by Kelly Ramos in the last half of the ninth inning left the Leones stranded in the field, winning 9-8. The victory brings the Aguilas to a 5-7 record, tied with Licey in fourth place in the standings.
In a marathon five-and-a-half-hour game, Juan Francisco hit two homeruns and batted in six runs as the league-leading Gigantes defeated the Estrellas Orientales 11-7 in 13 innings.
Team W-L Avg. Games Behind
GIGANTES 9 - 2 .818 --
TOROS 8 - 3 .727 1.0
ESCOGIDO 6 - 6 .500 3.5
LICEY 5 - 7 .417 4.5
AGUILAS 5 - 7 .417 4.5
ESTRELLAS 2 - 10 .167 7.5

Tonight's game
San Francisco de Macoris, Julian Javier Stadium: Toros (O. Beltre) vs. Gigantes (A. Lopez), 7:30pm.
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