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Daily News - Tuesday, 16 December 2008

Fernandez at CALC
In Brazil for the Rio Group meeting and the First Summit on Integration and Development of Latin America and the Caribbean (CALC), President Leonel Fernandez highlighted the importance of summits in enabling the region to join forces for meeting the challenges of the global crisis. "Today more than ever there is the need for a great bloc that integrates South America with the Caribbean," said President Fernandez upon arrival. He traveled to Brazil with a delegation that includes Foreign Relations Minister Carlos Morales Troncoso.
The two-day CALC conference is taking place 16-17 December in Costa do Sauipe. It is being held in parallel with the Mercosur trade bloc summit on Monday and Tuesday that brought together leaders of Brazil, Argentina, Paraguay, Uruguay and Venezuela. Thirty-three presidents from Latin America and the Caribbean gathered to discuss ways to promote trade, integration and development. Press reports highlight the significance of the fact that neither the United States nor the European Union were present at the meetings, signifying a new stance by leading countries in Latin America that are displaying a strong influence in the region.
President Fernandez will also attend a summit of the Rio Group, with its 23 nations in the region, including Cuba, which is expected to be admitted on Wednesday.
The Brazilian Foreign Affairs Ministry issued a statement on CALC: "The completion of the summit reflects our countries' firm conviction that increasing dialogue and regional cooperation is essential for our region's improved integration in the current international system."
The meeting should focus on issues related to integration and cooperation for the sustainable development of the region in the context of the current financial crisis, as well as energy cooperation, food security and climate change, according to the statement. In addition, the Brazilian government hopes that the summit will contribute to strengthening various regional initiatives and the existing sub-regional integration mechanism, while reaffirming that priorities needed to be placed on economic and social development.

DR triggers EPA enactment debate
In an interview with the Barbados Advocate newspaper the Dominican Republic's ambassador to the European Union, Federico Cuello Camilo says that now is the time for the region to focus seriously on the implementation process for the European Partnership Agreement (EPA) and come to a consensus on how this would be handled on a regional level.
At the recent Cariforum Ministerial in Guyana on 26 November, Cuello highlighted the need for an intergovernmental mechanism for consensus decision-making. In his opinion that mechanism already exists in the shape of the Cariforum Council of Ministers Responsible for External Trade Negotiations. "We don't need to reinvent the wheel there, we already have the mechanism," he said.
He stated that when it comes to the institution that will have the authority to co-ordinate the region on EPA matters and its implementation, the better two options are the Caribbean Regional Negotiating Machinery (CRNM) or the Caribbean Export Development Agency (CEDA).
Cuello says that CEDA is mandated to promote trade and promote investment in the region and is the only other institution, besides the CRNM that is truly a Cariforum institution. "All of us are represented on its managing board; this institution is governed by the Cariforum Council of Ministers, so whatever changes are made to its mandate can come from the Cariforum Council of Ministers directly", he explained. He also said that the most important thing is that they already have a contribution agreement with the European Commission. "So they can receive and they have already received funding from the European Commission during its 12 years of existence."
He said the DR does not favor the Caricom Secretariat because that institution has shown a lack of performance in the past, and that it already represents the Caricom states in the implementation of the Caricom-DR-FTA. He also is against the creation of a new institution, seeing as this involves new capital, new staff and a new venue. In the statement circulated to the CARIFORUM Ministerial at Guyana last 26 November, Ambassador Cuello called for a consensus decision by all CARIFORUM member states on which institution should be the regional coordinator.

EPA = more united Caribbean
The Economic Partnership Agreement (EPA) between CARIFORUM and the European Union (EU) could serve to cultivate closer trade ties between CARICOM and the Dominican Republic (DR), after years of slow progress, Dominican Ambassador to the European Union, Federico Cuello told the Barbados Advocate. He believes the EPA could result in the creation of a number of linkages between the two that have been missing in the past. He was referring to the fact that a CARICOM-DR Free Trade Agreement had been on the tables since 1998, but the implementation record has been abysmal, noting that this has resulted in very little trade between the two parties. He told the Barbados Advocate that the trade between the two is characterized by greater export from the former to the latter than imports, which he hopes is an advantage that the region can continue to enjoy in the future. He stated that this is possible because the DR has given to CARICOM what they have given to Europe under the EPA, which is 95 per cent free trade.
"We do not want to discriminate against CARICOM, and favor the Europeans by not applying the regional preference. That is why I think the regional preference is a major victory for CARICOM, because they will enjoy access in the DR in areas where they didn't enjoy access before."
He stated that under the CARICOM-DR agreement, the region did not enjoy access on orange juice and on glass bottles, for example. "These are specific examples where there was a particular interest, and it's only because of the regional preference that finally there is access into the DR."
He also pointed to the issues of distribution services where the DR's famous Law 173 required the distribution of CARICOM products to be performed by distributors established in the DR and associated with DR partners. This was correctly viewed as a protectionist measure, and has subsequently been discarded with respect to their agreement with Europe, and as a result of the regional preference, CARICOM also now enjoys access into this sector.

DR advancing re WTO
The DR has fulfilled 31% of the requirements set out by the World Trade Organization (WTO). According to Jose Rivas, director of the International Commerce Division at the Customs Department (DGA), the WTO proposed 49 measures related to international trade that the DR had to address, of which the country has revised 31.22%. Among these agreements are article 5, 8 and 10 of the General Agreement on Trade and Tariffs (GATT), which related to transit rights, freight, publication and transparency. Of the remaining measures Rivas assures that 52.23% have been partially revised while 16% have not been revised. Rivas added that these measures are being discussed internally by over 100 WTO member nations. The need to revise these measures is stipulated in an agreement to phase out trade clauses granted under the 1947 GATT agreement, which were ultimately overridden by the 1995 WTO agreement.

Crisis felt in the DR
Until a recent summit in La Romana with the Economic Commission for Latin America and the Caribbean (ECLAC), global financier George Soros and former chief economist at the World Bank Joseph Stiglitz, President Leonel Fernandez maintained that the DR was immune to the international financial crisis. Now the reality is setting in. The country is starting to see chinks in its armor as US-based companies are suspending contracts and reducing production orders from free trade zones (FTZ) in the DR. According to Listin Diario, Chrysler, J.C. Penny, Home Depot and Bombay are among the companies that are reducing their orders for products made in the country and as a result the National Free Trade Zone Export Council (CNZFE) has announced that the FTZ in Esperanza has cut 30 jobs. CNZFE confirms that at least 600 jobs will be lost in La Romana's FTZ. CNZFE director Luisa Fernandez Duran said that US company closures have affected FTZs in the country. As the crisis grows worse in the US, the DR could begin to feel the crunch. But not all hope is lost, according to Fernandez, saying that 98 installation permits have been granted with a total RD$5 billion investment, which could create 11,000 jobs.
Between January and September 2008 126,038 jobs were lost, an average of 14,004 per month. According to the Labor Ministry 101,928 of those job losses were due to dismissals, 4,960 due to employees quitting and 19,150 for "other reasons." Among these job losses are the 900 Falconbridge mineworkers who were recently dismissed, as well as 4,000 Grupo M workers and 1,500 Cap Cana employees who lost their jobs in recent weeks.

Car sales drop
Car sales dropped a whopping 65% in November, which could signal a new trend for 2009. According to Listin Diario, in November only 920 new cars were sold, compared to an average of 2,300 per month sold between April and November. Vehicle importers association ACOFAVE executive Enrique Fernandez says that sluggish sales are partly due to a lack of liquidity in the markets, high interest rates, fear of investing in the markets and instability in projections. As a sign of the times only one of Santo Domingo's three annual car fairs were held this year, at the Banco Popular.

Parkland purchases not legit
The Ministry of Environment says that it will not allow any construction whatsoever in the National Park of the East. Environment Minister Jaime David Fernandez Mirabal told Diario Libre: "no multi-millionaire, millionaire, honest person, trafficker, scoundrel, nobody can buy land there, because the title will not be legitimate." He said his department would not issue any permits for development there if these were in violation of Environmental Law.

Carving up paradise?
Is a real estate development boom compatible with sustainable tourism? New viewpoints are gradually emerging. In the DR and abroad, debates are under way on whether the conversion of hotels into apartments and the boom in residential real estate that displaces hotel tourism is in line with sustainable development.
IPS News reports that Charlie Simon, a local artist in Las Terrenas, says that things are worse for him now compared to a few years ago. He is concerned about all the new construction and what it will mean for the future of the place. "It is not such a good thing to build so many apartments. People come for a week or two and then lock the place up and leave. Or people come for the weekend from the capital, they come with their own food, with everything. These people, what do they bring? You don't need many people to work in an apartment. It is not business for a town. Fifty apartments will produce maybe five jobs. How much will they make each month, the maids, the gardeners, maybe RD$5,000 a month? This is a benefit for the country? No."
President Leonel Fernandez is under pressure to sign permits for developers in Cabarete that will legalize the violation of a zonal law that bans the construction of buildings over 11 meters high or limits them to three floors in Puerto Plata province. The Federation for a Sustainable Cabarete is concerned that this may open the floodgates for four-story buildings that have already been built or sold, and encourage other developers to follow this as a business strategy. That is, to start the illegal construction, and then get Presidential approval in order to legalize it.
The Federation is sponsoring studies currently under way by the University of Baylor in Texas and the Pedro Henriquez Urena Architecture School in Santo Domingo aimed at analyzing the effects of an increase in density on the well-being of the community and on the winds of Cabarete, the source of the area's growth as a tourist attraction.
Meanwhile, paying off government officials seems to be the modus operandi, as reported in IPS News. Dr. Jose Bourget, a Dominican University of Maryland professor who teaches via the internet, settled in Las Terrenas with his family six years ago, shares Simon's concerns about development. "I think Las Terrenas has grown too much, too soon. That has had a tremendous impact on basic services and infrastructure, on water, roads. People were building any way they wanted, anywhere they wanted. Much of it was done by paying off officials," he told IPS.
In Cabarete, the deputy Minister of Tourism for the North Coast Cesar Jose de los Santos recently held a workshop about a development plan for Cabarete, attended by 50 local business owners, builders and community representatives. It was reported that seven architects and planners are working on a master plan to define development zones in Cabarete, taking into consideration the area's capacity to absorb more construction. Architect Maribel Villalona, director of planning at the Ministry of Environment confirmed that the current law limits building to three floors. She also stated that so far the Ministry of Tourism has never given a permit for higher constructions. For more information, see:
www.ipsnews.net/news.asp?idnews=45118
www.listin.com.do/app/article.aspx?id=83729

More government bureaucracy
Through decree 814-08, President Leonel Fernandez has created the Presidential Committee for the Strengthening the Electric Sector. Fernandez himself will lead the committee, which will be made up of government employees and private sector representatives, including Jose L. Corripio, Lisandro Macarrulla, Felix Garcia, Juan Vicini Lluberes, Roberto Bonetti and Celso Marranzini. PUCMM University rector and the DR's leading mediator Monsignor Agripino Nunez Collado will also sit on the committee. The decree stipulates that members must meet to discuss energy sector issues at least once a month. This is the latest attempt in a long-standing tradition of trying to solve the energy issues through the creation of another government bureaucratic structure. If history is anything to go by, this commission will meet in its early stages, and will present ideas for solving the country's energy crisis, but little will actually get done. This is backed up by the fact that the decree that creates the committee accepts that energy problems are due to lack of payment. This is the big elephant in the room, yet the government seems unwilling to effectively tackle this issue, despite dozens of studies indicating that the problem is one of political inability to take tough decisions.

Military patrols for Xmas
If you have seen an increase in military presence on the streets don' t be alarmed. It is part of the army's Ciudad Tranquila (Ciutran) holiday safety program. The army has sent out troops on 12-hour patrols beginning at 6pm. Though holiday safety programs are being run by the National Police, Lt. General Pedro Rafael Pena, who is leading Ciutran, said that if the National Police needed support in their safety programs the army would be there to lend a hand.

Hunger strike over
FENATRANO union leader Juan Hubieres has ended his week-long hunger strike following a visit by Transport Reorganization Office (OPRET) director Diandino Pena. Pena made it clear to Hubieres that the Metro subway feeder lines have yet to be drawn up and won't be determined for another eight months. Pena assured Hubieres that FENATRANO would be included in the process because these types of projects will involve the full integration of the public transport system. As for the Metro, Pena said that he would hold a press conference tomorrow to provide details about the Metro and to announce when the free Metro holiday program would begin.

Plane crashes
Listin Diario is reporting that an Atlantis Aviation Trilander plane with 12 people on board is missing. The plane took off from the Cibao International Airport at 4:06pm yesterday, en route to the Turks and Caicos. Carlos Garcia, Jose Luis Rodriguez, Alexandra Abreu, Maria Abreu, Rosa Tavarez, Maritza Rodriguez, Maritza Hernandez, Juana Ramirez, Ronulfo Herrera, Omar Rojas and pilot Adriano Jimenez were on board. Initial reports indicate that the pilot made a distress call shortly before the plane fell off the radar. Civil Aviation Institute (IDAC) director Jose Tomas Perez said that he is maintaining close contact with the US Coastguard for any developments.

Infestation threatens banana crop
The Black Sigatoka fungus is threatening banana harvests in the southeastern Dominican Republic. According to Hoy there was an increase in the spread of the infestation once the hurricane season ended and an estimated 20,000 tareas (12,580,000 square meters) of banana farmland has been affected. As a result the Agriculture Ministry has begun educating local farmers on how to prevent the spread of the disease and protect their crops. Farmers are being shown how to dispose of infected plants and on the use of pesticides.

Presidente goes pro
Presidente beer will be an official sponsor of the NBA's Miami Heat, making the Dominican national brand the first to sponsor a major American sports team. In the past, Presidente had an agreement with the NFL's Miami Dolphins. Few details about the partnership have been released, but Listin Diario reports that Presidente will be able to use the Miami Heat logo as part of its promotional campaigns. The beer will also have a special place in Miami Heat luxury boxes. The move by Presidente is a testament to the company's growth in recent years and its small but growing following beyond the borders of its native country.

Sports update
Dominican-born Al Horford is continuing his rise to the top of the best professional basketball league in the world. Horford scored 12 points and had fourteen rebounds in 38 minutes of play, shooting 6-12 from the field. It was Horford's third double-double of the season and his play has been a major reason for the Atlanta Hawks' 15-9 start. Horford is also fifth among Eastern Conference centers for a starting spot on the 2009 All-Star Team. In related news, Charlie Villanueva, despite having a tough season, is showing signs of life after scoring 20 points and grabbing six rebounds in a victory against the Miami Heat. Villanueva also dished out five assists in the victory.
 
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