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Daily News - Thursday, 26 February 2009

DR1 breaks for Independence Day
DR1 Daily News will not be updated tomorrow, Friday, 27 February on the occasion of Independence Day, a national holiday. Breaking headline news can be shared on the Forums that are open 24/7. Long weekend news will be compiled for the Monday, 2 March issue.
In the meantime, for updates on the Dominican Republic, keep in touch by reading the forums at www.dr1.com/forums

No cancellation, military parade is on
The 27 of February Independence Parade is on. Despite yesterday's news report that the parade had been suspended, the Ministry of the Armed Forces says that the parade is going ahead as planned and promises to be one of the best ever. The news story had indicated that the parade was being canceled in the wake of the recent accusations against high-ranking army members in the Dominican Republic, following several crimes where they are alleged to have played leading roles.
The Friday, 27 February parade will commemorate the 165th anniversary of Dominican Independence. The parade will begin at 3pm on the Malecon (Av. George Washington). An Air Force Squad is coming from Brazil to show off the prowess of the Tucano airplanes that the Dominican government recently spent millions on purchasing.
The military parade will follow the 10am morning state of the nation address of President Leonel Fernandez to the nation from the seat of Congress.

Seeking new business with India
A 12-person Dominican business mission is taking part in the India-Latin America and Caribbean Conclave: Project Partnerships 2009 organized by the Confederation of Indian Industry (CII). The event coincided with the 18th International Engineering & Technology Fair (IETF 2009). The Conclave discussed business opportunities in pharmaceutical and healthcare, biotechnology, infrastructure and transportation, information-communications-technology and skills development, agri-business, energy including bio-fuels, chemicals and chemical products, media and entertainment, mining, tourism and hospitality and looked at opportunities in project partnerships between India and the region. The DR delegation was the largest among 10 participating countries in the 25-26 February meeting that took place in Bangalore, in the Indian state of Karnataka.
Eulogio Santaella, director of the India Chamber of Commerce in the Dominican Republic said that the Dominican delegation sought to establish new business ties for investment and trade with India. Honorary Consul of India in the DR, Fernando Gonzalez Nicolas and Dominican Ambassador in India, Hans Dannenberg Castellanos headed the delegation.
The meetings were aimed at further strengthening the bilateral work ties that have been growing ever since the Ministry of Foreign Relations opened the Dominican embassy in New Delhi, said chief of mission Santaella.
Ambassador Dannenberg said the mission follows in the policy of diversification of international relations under President Leonel Fernandez, in a joint effort with the DR Center for the Export and Investment (CEI-RD) to maximize the country's potential with emerging economies, a policy that is showing positive results.
Dominican business representatives from the areas of transport, light manufacturing, cigars, apparel, pharmaceuticals and energy are forming part of the delegation.
The meeting is being organized by the Confederation of Indian Industry (CII). Santaella made the point that the importance of the event is that it was specifically designed by the hosts to strengthen ties with Latin America. Also in attendance were business delegations from Argentina, Brazil, Cuba, Ecuador, El Salvador, Guatemala, Mexico, Peru and Uruguay.
As part of the Dominican delegation, Sandy Gabriel's merengue and Latin jazz band entertained those present at the III Conclave of India- Latin America and Caribbean Business.

JCE bids to reverse SOMO decision
The president of the Central Electoral Board (JCE), Julio Cesar Castanos Guzman, said yesterday that the JCE seeks to reverse the court ruling requiring them to pay US$9 million to the Consorcio Soluciones Modernos (SOMO) for failure to honor a contract. According to the head of the JCE, payment to SOMO, which worked under contract to automate the electoral agency, is still up in the air. The JCE lost the case in a court of arbitration designated by the Santo Domingo Chamber of Commerce. Payments to SOMO were stopped when the electoral board members were changed and many complaints and questions were raised about the civil registry digitalization process. Castanos Guzman reported that the full board of the JCE is planning a meeting with SOMO executives.

Lake Enriquillo case under study
The commission set up by President Leonel Fernandez to deal with the problem of flooding in Bahoruco and Independencia provinces will submit a report today outlining the corrective measures that need to be taken after a meeting with representatives of the affected communities yesterday. According to El Caribe, the ministers of Agriculture, Public Works, Environment, the director of the National Hydraulic Resources Institute (INDRHI) and the Presidential Press Secretary met with cattle ranchers, farmers and representatives of the Catholic Church and listened to their complaints, requests and suggestions for solutions to the problem. Priests Michel Vargas Rosario from Bahoruco and Francisco Feliz from Jimani said that they felt that the number one priority should be the construction of a dike on the Trujillo Canal in Tamayo, as a way of stemming the flooding of the lake by waters of the South Yaque River. They said that the dike had been destroyed by flooding after Tropical Storms Noel and Olga in 2007 and has yet to be repaired. The cattle farmers also asked for their RD$19 million debt with suppliers and creditors to be taken over by the National Council for the Promotion and Regulation of the Milk Industry (Conaleche). They pointed out that 60% of their grazing land has been lost to the rising waters of the two lakes. Father Feliz said that if the dike is not constructed, entire towns in Bahoruco and Independencia provinces could disappear from one moment to the next. Representing the government, Environment Minister Jaime David Fernandez Mirabal promised that they would begin solving the problems that are affecting the inhabitants of the region by next week.

Loans still scarce for private sector
Private sector borrowing in February was down, despite a reduction in interest rates ordered by Central Bank authorities. However, loans to public sector entities are increasing at an unusually high rate.
Hoy newspaper says that according to official figures, bank loans to the private sector decreased by more than RD$2 billion during the first 16 days of February, going from RD$246 billion to RD$243.94 billion. With reference to December 2008, the reduction was even more significant, an RD$8 billion decrease, since in December there were private sector loans for RD$252 billion.
Contrastingly, public sector borrowing registered a significant increase during the final months of last year when it reached RD$44.76 billion. For 2007, the difference is all the more significant, since in 2007 the banks lent the public sector just RD$22 billion. So far this year, loans to the public sector have increased by more than RD$2 billion, going from RD$42.38 billion in December 2008 to RD$44.7 billion on 16 February 2009. Hoy reports on the increased borrowing by the government from commercial banks, to compensate for a decline in tax collections and the reduction in financing of petroleum purchases under the PetroCaribe agreement with Venezuela. PetroCaribe financing increased when the price of petroleum was going up.
An indication of the reduced liquidity of the private sector can be seen in the M-1 (the amount of money in circulation) that saw a 5.5% decrease as of 16 February 2009 versus a year ago. Monetary authorities have relaxed some of the economic controls in an attempt to get the economy going again. As reported in Hoy, the reduction in interest rates on Overnight and Lombarda loans is proof of the new policies. Economist Hugo Guillani Cury suggested raising the amount of money in circulation to December 2008 levels.

Government contradictions
Writing in today's Diario Libre, economist Alejandro Fernandez comments on the contradictions between what the government requires of the private sector and the leeway it allows itself. As example of how while the private sector has had to tighten its belt in contrast with the public sector, he points out that as of October 2008, the government spent 30% more on payroll than it did in October 2007. He also says that December 2008 was a record month for the government to contract public debt - almost RD$1 billion per day. He writes that this was the "consequence of having to balance the accounts for the year, even if our children will be the ones who pay."
He also makes the point that while the Department of Taxes (DGII) levies heavy penalties on taxpayers who are behind with their payments, the government is already 120 days late in publishing what it does with taxpayer money. He points out that many businesspeople are delaying taking on new business commitments. Even so, government tycoons think differently. "For them all is swell, the money is there (in new debts to be paid by future taxes) and the will that never is lacking."
He mentions the nationalization of the Shell Petroleum Refinery, the efforts to nationalize the energy sector, and the ongoing idea of building a train to connect the Port of Haina with Santiago. Examining economic indicators provided by the Central Bank, he points out that the private sector has reduced borrowing by RD$8.2 billion and has accumulated savings of RD$4.1 billion. However, during the first 47 days of the year the public sector has taken on RD$2.4 billion in new loans and used up RD$2.5 billion of its savings, or RD$4.9 billion in new debt compared to RD$10.3 billion in savings by the private sector.
He writes about the "divorce" between the Central Bank's monetary policy and the government's fiscal policy. He says the Central Bank might be having a hard time understanding why the recent measures haven't resulted in a decline in interest rates. He has the answer. "How are they going to drop if the government is using its liquidity through the governmental Banco de Reservas while it seeks more loans in the banking system?"

Priority for the cruise ship port
Several leading business organizations are urging the Puerto Plata municipality to give priority to supporting the development of a modern port for the city. The Puerto Plata Tourism & Cultural Cluster says that the city of Puerto Plata has repeatedly asked for the land to be used to build a Tourist and Cargo Port, which they consider the number one priority for the definite development of the region. The Cluster raises a red alert that the municipality should not negotiate the purchase of any coastal lands with a third party, especially in the center of the Bay of Puerto Plata, because this would limit the development of the proposed port.
A Puerto Plata legislator has warned that negotiations are under way for the municipality to sell to the operators of the power plant where Smith-Enron originally built the plant that has been very detrimental to tourism and residential interests near the Costambar area. Deputy Carlos Martinez Arango says that the lands would be sold at RD$500 a square meter, when land in the area is valued at RD$3,000 a square meter. Deputy Martinez warned Mayor Walter Musa and Council leader Carlos Andres Gonzalez to desist from such an operation that they deem would be very harmful to the municipality of Puerto Plata, which owns the land, as reported in Diario Libre.
Martinez told Diario Libre that Smith and Enron made the purchase offer to the city government because the lease on the land is up in a year. He said that the ideal scenario would be for the power plant to be relocated to a site where it would be less harmful. He says it has been detrimental to Costambar and to the communities of La Habilla, Las Tres Palmas and San Marcos.
The alternative plan is to build a cruise ship port there that will bring thousands of tourists to the town of Puerto Plata. "There is no way that the city government should sell those lands to that company, when they know that it pollutes the coast and nearby communities," Martinez told Diario Libre. Organizations that oppose the sale of the lands to Smith-Enron also include the Association of Hotels and Tourism Companies of the North (ASHONORTE), the Playa Dorada Association (AHPD), the Tour Operators Organization (OPETUR), the Sosua and Cabarete Hotels & Restaurants Association (ASHORESOCA), the Cabarete Development Association (ADECA), the Atlantica Foundation, the American Chamber of Commerce-North Chapter, the Puerto Plata Chamber of Commerce, the Renovacion Cultural Society, the Puerto Plata Industrial Free Zone Corporation and the Federation of Taxi Unions (FETATURNO).

AIDS affects more than 60,000
A report from the United Nations Children's Fund (UNICEF) reveals that 62,000 AIDS cases were registered in the Dominican Republic at the end of 2007. Moreover, their "State of the World's Children 2009" report indicates that more men are having protected sex. The study found that 44% of Dominican women protect themselves during sex with an extramarital or unknown partner, while 70% of men use some sort of protection. At the same time, the investigation points out that nearly half of young people (44% of those between the ages of 15 and 24) are aware of measures they can take to protect themselves from the HIV virus, such as the use of a condom and a faithful partner and they know that a person who appears healthy can be infected with the disease.

US on human rights violations
The report on Human Rights 2008 for the Dominican Republic published by the United States Department of State indicates that serious problems persist with the human rights situation in the country because illegal killings, beatings of suspects, limited access to justice, corruption and violence against women and minors continues. The broad report tells of an increase of 37% in violent deaths with respect to 2007, and attributes 19% of these to the National Police. It adds that the law enforcement institution continued the practice of torturing prisoners and unarmed civilians, requested bribes from citizens and carried out arbitrary arrests and detentions. Nevertheless, the report indicates that 312 agents were discharged and 563 were punished for these practices. The judicial system was also accused of its share of violations. The report attributes inefficiency and corruption within the justice department to the significant number of accused who were granted bail only to never appear in court for trial. It maintains that most people who are detained and jailed but do not have money to pay found it difficult to obtain a lawyer, despite the law that facilitates legal council for the destitute. Likewise, it stresses that cases of political influence on judicial decisions are still evident, and "that on occasions it appears that some high court judges tried to influence, improperly, decisions by lower courts." Government corruption was seen as a serious problem, and the report also states that "apparently there is a lack of interest on the part of the authorities to investigate seriously and prepare trials in those cases that involve high-ranking governmental authorities whether in the current government or in the former (referring to that of Hipolito Mejia)". The report indicates that when cases did go to trial, the accusation was seldom successful in obtaining convictions or prison sentences. Likewise it emphasizes the lack of impact that the Ethics and anti-Corruption Commission has because it lacks the authority and structures to take decisions that are well defined. According to the report, the government regularly denies the registration of children of Haitian parents backed by the exception of them being in transit that is contained in the Constitution. The report also sets out the problems experienced by people in this situation in accessing services, and maintains that racial discrimination persists. The violation of the rights of women and minors, the disabled and people with HIV-AIDS is also emphasized, with the latter mainly suffering in the work place. The report also mentions human trafficking and reported attempts to curtail the right of workers to form unions in businesses. It also mentions threats to the press.
See http://santodomingo.usembassy.gov/hr_report-2008.html

Income tax fraud case update
The First Court of Instruction in Santiago has ordered preventative custody for 11 people accused of fraud worth more than US$100 million against the United States Treasury Department. Three of the accused were sent to jail while the rest are under house arrest and banned from traveling. Among those subject to coercive measures were Elvin Quiroz, Alfy Tavarez, Carlos Balbuena and Elvis Balbuena. According to the investigation carried out jointly with the US Federal Bureau of Investigation, the accused cheated the Treasury Department for US$100 million in checks cashed. Meanwhile, this year the requests for fraudulent tax returns corresponding to tax year 2008 that have been presented total over US$70 million, but none of the tax return checks were sent because of the fraudulent operation. The Prosecutor General of the Dominican Republic Radhames Jimenez Pena and Santiago district prosecutor Raul Martinez stated that several of the people accused of the fraud could be extradited if it is proven that they are responsible for committing the crime.
Those arrested are accused of filling out forms on the Internet that were then printed and sent by e-mail to the United States to get tax returns for payment of excess taxes. FBI agents are involved in most of the inspections in the investigations that are being carried out. Together with District Attorney Martinez, the investigative commission is composed of General Claudio Peguero and Colonel Alejandro Dipre.
Lawyer Victor Breton, who is defending several of the accused in the fraud case, said that two of his clients are university students who were allegedly paid on a weekly basis to fill out the forms. Breton pointed out that his clients were supposedly tricked by a person who is currently on the run and who allegedly stole the identity of his defendants through the Internet in order to commit the fraud against the US Treasury.
The Prosecutor General said that this is an international ring that spans the Dominican Republic, Puerto Rico and the United States. Meanwhile the US authorities say that an important amount of the fraudulent tax refund requests presented in 2008 were made from the Dominican Republic via Internet. The addresses that appear on the checks are grouped in specific areas.

Parmalat suspect turns himself in
The National Police reports that a suspected assailant or accomplice in the raid on the Parmalat milk processing facility turned himself in at police headquarters on Wednesday. So far, the Parmalat case has led to four arrests: a former military officer, a former sergeant and two civilians. The new detainee is Isidro Valdez Pascual, who was accompanied by his mother and wife, Dona Maria Pascual and Micaela Andujar, and lawyer Leonardo Moreno Bazals. Until now, the investigation is being handled with just the nicknames of suspects in the crime.

Plaza de Salud, Villa Mella robberies
Two robberies took place yesterday at the Plaza de Salud and at the Dominican Savings & Loan Association on Hermanas Mirabal Avenue (Villa Mella). In the latter the guard, Domingo Mateo Rodriguez, was killed. Dashira Martinez, public relations manager at the Plaza de Salud hospital complex said that yesterday morning, unknown persons removed "more than a half a million pesos" from the main safe.
Hector Franjul, the business manager at the Villa Mella S&L, said that the thieves took RD$607,000 in cash. The robbers arrived in a gray Toyota Corolla and immediately entered the bank, aiming weapons at those present and taking the money. When guard Mateo Rodriguez tried to intervene by shooting at the robbers, they turned against him and killed him. The search for the assailants began yesterday.

Just questioning, no arrest
The General Prosecutor's office is denying reports that three district prosecutors from Puerto Plata (Grimilda Disla, Wilfredo Martinez and Ramon Nunez Liriano) have been arrested. Assistant prosecutor general Ramon Aristides Madera Arias said that the three were interviewed so they can provide details on several Puerto Plata court cases, as reported in Listin Diario.
He said that Puerto Plata Court of Appeals prosecutor Feliz Alvarez invited the assistant prosecutors to his office at the General Prosecutor's Office in Santo Domingo. Madera said that once the results of any possible irregularities on the job of the Puerto Plata prosecutors is known, this will be revealed to the press.
Yesterday, DR1 carried a story on the reported arrest of three district prosecutors from Puerto Plata, indicating that they were being sent to Santo Domingo for further investigations. Recently, 30 law enforcement officials have been suspended in Puerto Plata, as the authorities look into their connections with drug traffickers.

Carnival on Sunday
On Sunday, 1 March the National Carnival Parade will take place along Santo Domingo's Malecon seafront boulevard. The top carnival troupes from all round the country will march in the four-hour long parade, which begins at 3pm and usually lasts until shortly after sunset. Ramon Lachapelle, in charge of the carnival parade organization for the Ministry of Culture, says that 69 groups have been chosen. The groups will compete for a first prize of RD$50,000, a RD$25,000 second prize and a R$15,000 third prize, as reported in Diario Libre.
For more on upcoming events, see http://www.dr1.com/calendar

Showers for the long weekend
The Weather Department (Onamet) is forecasting scattered rains today. Onamet says that they expect an increase in cloudiness as well as rains in the provinces of Montecristi, Puerto Plata, Samana, Santiago, Maria Trinidad Sanchez, Hato Mayor, El Seibo, San Cristobal, Monsignor Nouel, La Vega, Sanchez Ramirez, Duarte and Monte Plata. Santo Domingo and the National District may also get rains today, and some strong wind gusts towards the afternoon. Onamet says a frontal system over the Windward Passage will also bring cool temperatures. Onamet says that small craft warnings are in place for the north coast due to abnormal wave conditions in the open sea.
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