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Daily News - Tuesday, 05 May 2009

Book Fair breaks records
The sale of books, educational materials and food at the XII Santo Domingo International Book Fair 2009 went past the RD$80 million mark, according to Minister of Culture Jose Rafael Lantigua. The minister said that book sales totaled over RD$52 million and food sales exceeded RD$29 million. He added that attendance over the two weekends was also record-breaking. Lantigua declared that, "Brazil's presence as the invited nation brought its great presence to bear with dozens of activities that captured the public's attention."
El Caribe newspaper says that high-ranking government figures were notable for their absence at the closing ceremony, as well as Dominican intellectuals who apparently gave the event a miss.
One of the more permanent results of the fair was the opening of the Brazilian Cultural Center in Gazcue. Fair director Alejandro Arvelo announced that next year the country that was being invited as guest of honor would be Mexico.
Among the awards handed out on the final night, the Omnimedia and the UASD received trophies for the best stands at the fair. According to informal reports, Juan Bosch's "La Manosa" was the top selling book

Constitution review continues
The Constitution Revisory Assembly will continue its deliberations this afternoon focusing on articles relating to collective rights and the environment. Also pending is the discussion and possible approval of Article 54 on the right to physical education, sports and recreation that would be included in the Constitution for the first time.
Regarding this aspect contained in Section III, the proposal from the Executive Branch says "collective or diffuse rights and interests are: the right to peace, the right to develop, the right to ownership of humanity's common heritage, the guardianship of public health; the conservation of the ecological balance, of the flora and fauna and the protection of the environment; the preservation of the cultural heritage and esthetic, historical, urban, artistic, architectonic, archeological, and national scenic values; the correct marketing of merchandise to the public, fair competition and interests and right of the consumer and customer of public services. The Law will regulate the conditions and limitations of the exercise of these rights."
Also on the agenda is Chapter II regarding the guarantees of the fundamental rights and Chapter III on the principles of application and interpretation of the rights and guarantees as well as Chapter IV on the fundamental duties and the controversial issues of population and nationality.

Govt. gives priority to growing payroll
The Dominican government reduced capital spending and increased spending on salaries in the first quarter of 2009 compared to the same quarter in 2008. In the first quarter the payrolls absorbed RD$15.6 billion, nearly RD$2.8 billion more than the same period in 2008. According to a report on budgetary performance for the first quarter, the government also cut back on capital spending some 58.4%, spending just RD$5.77 billion on construction, projects and purchases of good and services, while last year the figure for the first quarter was RD$13.8 billion.
According to Listin Diario, what happened is easy to understand: the authorities reduced their capital spending instead of cutting current expenditures. From RD$50.36 billion in 2008, the government spent RD$46.84 billion in 2009. Since the government knew it would have less income and had to cut expenses, it preferred to sacrifice 58% of the capital expenditures and just 7% of the current expenditures.
According to the Ministry of Hacienda's Budget Directorate, the government had to find RD$11.75 billion in financing of which RD$9.31 billion came from local banks and RD$2.43 billion came from international organizations.
In the first quarter of 2008, there was a RD$2.19 billion surplus, however in the remaining three quarters the deficit went from RD$1.36 billion in the second quarter, RD$15.83 billion in the third quarter and, finally to RD$39 billion in the third quarter, for a total budgetary deficit of some US$56 billion.
In January 2009 the budget showed a surplus of RD$4.82 billion, but in February there was a deficit of RD$1.19 billion and in March it was RD$1.97 billion.

Corruption at INDRHI?
Former employees of the National Hydraulic Resources Institute (INDRHI) are complaining of nepotism and violations of the law at the department that oversees dam operation and construction. Director Hector Rodriguez Pimentel is a high-ranking PRSC politician who has allied with the PLD government. Listin Diario reports that the case is being audited by the Chamber of Accounts, whose president is also a well-known PRSC politician.
Former employees Mercedes Solis, Omar Chevalier and Mario Espinosa allege that over 30 of persons related to the director were on the payroll, costing the institution more than RD$1 million a month, while rendering no service.
In a letter to the Chamber of Accounts dated 29 April, the former employees say that equipment purchased by the department never reached its intended users, and other equipment was purchased two or three times, as reported in Listin Diario. They also complained that expenses such as living in a hotel, traveling accompanied by several persons who did not render a service or purchasing goods for personal use should not have been made with a credit card paid for by INDRHI. They also complain that the director of the department has repeatedly violated Law 340-06 that requires tenders for granting public works contracts.
Rodriguez dismissed the charges as "gossip."

Energy does not halt blackouts
In the Dominican Republic, with an area of 48,422 square kilometers, 12 generating businesses that have, all together, 31 plants make up the National Interconnected Electricity System (SENI). According to estimates, the electricity service has been deficient for 40 or 50 years. Blackouts are common in the country.
On the Electricity Superintendence webpage, an executive summary by the SENI details how the Haina Generating facility has nine plants, Itabo has four, Metaldom has one, Laesa (La Electricidad de Santiago) has two, Hidroelectricas has one, and Union Fenosa has two. Likewise, Seaboard has two, Puerto Plata Electric Company (CEPP) has two, Monte Rio has one, AES Dominicana has three, San Felipe has one (the former Smith-Enron), and the San Pedro de Macoris Electricity Company has three (formerly Cogentrix). The plants, 31 in all, averaged 1,204 megawatts as of 30 April 2009, despite the fact that they have the capacity to generate a total of 3,067 megawatts, which leaves 1,853 megawatts unused. The demand for electricity is around 2,200 megawatts. Of the 31 plants that make up the SENI, nine are not in operation, such as: Haina II for generator repairs, San Pedro Steam and Puerto Plata I by administrative order. Also off line are Puerto Plata II with boiler issues; Barahona Coal-fired, undergoing a major overhaul, Itabo Turbo Gas, by administrative orde,; AES Andres is undergoing maintenance; Macoris II for major overhaul and Macoris III for inspection of the combustion chamber.
According to the Superintendence of Electricity and El Caribe newspaper, the country's three electricity distribution companies have 1,331,230 customers. As of today, Ede-Norte has 611,521 customers, Ede-Sur has 370,947 and Ede-Este has 348,762.
Electricity expert Jose Luis Moreno San Juan, consulted on this issue, said that another problem is that "some of the generating plants are totally dismantled", adding: "Here 1800 megawatts and in peak hours 1900 megawatts have been supplied, but the demand is for 2,200." He said that at least five new 300-megawatt facilities should have been installed to establish a supply base. He pointed out that two coal-fired plants at Itabo are selling electricity at 14 and 17 cents (US$) while a similar facility in Puerto Plata is selling energy at 6 and 7 cents. He said that excessive prices are part of the problem and called for a 12-cent electricity rate for residential consumers.

Possible general strikes in the air
While the labor sector threatens to stage a general strike if a wage increase is not agreed upon this week, the National Salaries Committee (CNS) has yet to set a date to discuss the issue. Union leader Rafael (Pepe) Abreu, who represents labor in the talks, criticized the management attitude in refusing to present a proposal for increasing salaries.
Meanwhile, the president of the Management Confederation of the Dominican Republic, Marisol Vicens, said that the business sector is willing to take part when the organization (the CNS) convenes and it will be there that they present their proposals on salary increases for the workers.
CNS president Gloria Henriquez reported that today they would try to set a date for convening the Committee, saying that a meeting had been set for last Thursday but she was not able to attend due to illness and the meeting was postponed. Henriquez reminded reporters that the law only allows this entity to discuss minimum salary issues for workers, but they have always been available to mediate between management and labor representatives in order to arrive at a satisfactory set of agreements on the other salary ranges.
The threat of a general strike is added to the wave of protests being held in communities all over the country in demand of infrastructure projects, roads, and, in the case of the doctors and other health workers, higher salaries. The workers are demanding a general wage increase of 40% for employees who earn up to RD$20,000 per month and 25% increases for those earning up to RD$30,000 a month.

Problems at JCE include how to pay SOMO
A lack of compliance by both parties, legal, financial and technological, surfaced in an audit carried out on the contract underwritten in 2004 for US$63.6 million between the Central Electoral Board and the Consortium Soluciones Modernas (SOMO) for the project to modernize the civil registry.
The final report of the audit, approved last week by the full board of the JCE, shows that upon not obtaining international financial backing for the project, the JCE used US$8,996,227 of its own budget to pay part of the capital and interest on a bridge financing that on 20 September 2008 had reached more than US$12 million.
The same audit carried out by the consortium RSM-Bepam-P&H-SMA, says that, "as a result that affected the operations of the JCE."
According to what Diario Libre has learned, two international banks were willing to finance the civil registry computerization project. However, by 31 January 2005 the Dominican Republic had signed a Stand-by Arrangement with the International Monetary Fund (IMF) that did not allow the Dominican Republic to go over a certain debt limit. Because of this, a local loan was sought with the BanReservas for US$35 million.
The JCE judges have reiterated that the crisis is due to the fact that this bank discounted RD$45 million each month for payment of the loan. Nevertheless, they did not indicate the nearly US$9 million used from the internal budget to pay for the project, when the budget assignment for the JCE for this year and last reached RD$2.432 billion.
The financial crisis that is being experienced by the JCE might well affect the preparations for the next congressional and municipal elections in 2010. According to what magistrate Jose Angel Aquino revealed to Diario Libre, the JCE Administrative Chamber may have to obtain a loan in order to manage the elections, and this would just make the crisis all the more profound.
The debts are also affecting the project to capture the biometric data, the change of the "cedula" (the personal ID and voter registration card) and the late birth registrations program.
The audit also revealed contractual violations of the Laws of Procurement and the Budget Law for the Public Sector. The first establishes that the assignment of funds to similar projects (Like JCE and SOMO) should be submitted for approval to the National Budget Office. Regarding the Budget Law, the JCE should have also submitted the budget for the project to the National Congress so as not to affect the JCE finances so much. On the question of the bidding process, the audit showed that SOMO, a consortium of several international companies, did not present any documentation that would show other projects, with the exception of projects in Brazil, from 1996 by the Samurai Company, a member of the consortium.
The audit also points out that the JCE did not fulfill its obligation to install the computer equipment in the Civil Registry Offices.
Three years ago, a legal dispute between the JCE and SOMO began, since the former stopped the work for alleged failure to comply with the contract. Last 9 February, the Santo Domingo Chamber of Commerce ruled that the JCE should pay US$9,042,000 to SOMO for work delivered and not paid for. To this decision the Chamber added a fine for each day's delay in payment, and this fine now totals over one million dollars.
The audit seemed to suggest that it was not convenient for the JCE to finish up the contract since another bidding process would generate money and time. If the contract were to continue, the audit recommended a revision of the unfulfilled points.

Education still lacks funds
When the government announced that it would provide the Ministry of Education with just over four billion pesos in addition to the money already budgeted, to meet demands that came up during the National Summit discussions earlier this year, the educational community got all excited and celebrated. However, the money has still not arrived and therefore, nothing has been done. These resources would have been allocated to projects such as teacher training, school infrastructure, new furniture and literacy teaching.
If, as Melanio Paredes, the Minister of Education, has said, the government waits until June to disburse the money, then the solutions will also have to wait. According to Hoy newspaper, the Ministry still does not have the RD$4.09 billion that was promised in February. The minister reported that the government is applying for loans from the Inter- American Development Bank and the World Bank to fund these activities. Meanwhile, Paredes said that he and the Ministry have prepared the financial planning for spending the additional resources and that progress has been made in the execution of the RD$33 billion budget approved for the ministry for this year. When this year's budget was approved, several sectors complained that Education should have received 4% of the budget as set out in the General Law on Education.

Bakers will deliver bread after agreement
After receiving RD$80 million of the RD$200 million that the Ministry of Education owes them, the members of the Union of Medium and Small Bakeries (UMPIH) have lifted their threat to suspend the supply of bread and cakes to the school breakfast program. The education authorities made the advance payment over the weekend. The ministry owes a total of RD$400 million, which includes other suppliers of solid foods. Upon making the payment for January and February, Minister of Education Melanio Paredes said that the delays in payments were due to government budgetary difficulties. Francisco Rosales, the president of the UMPIH said that he was happy to receive the first payment, as the authorities begin paying off the debt with suppliers.

SCJ sets out rules for expropriation
The full body of the Supreme Court of Justice (SCJ) has handed down a new set of general rules for cadastral measurements, which sets out the requirements needed for the state to expropriate lands. These also regulate condominiums. The regulations state that when a part of a plot of land is declared to be of imminent domain, and subject to expropriation, the section to be expropriated should be separated by a subdivision of the original parcel and needs to fulfill all of the requirements established for the expropriation.
The subdivided parcel that becomes expropriated will be registered in the name of the property owner unless it has been demonstrated that this person has received the total payment corresponding to the expropriation from the Dominican state. The initiation of the process is to be done by the expropriator or the owner of the property in question.
The regulations establish that the modifications to the parcel are intended to create new parcels from those already in existence.
Part of the regulations reads, "Changes in the adjoining properties or in the cadastral designation are not considered to be modifications of the parcel, nor are the dimensions of the parcel as a result of an adjustment in the original measurements." The regulations also establish that no modification of the parcel affected by guarantees will be authorized without the consent of the creditors. In all divisions for the constitution of a condominium, all the sectors that will be covered under different rights of condominium should be identified, determined, located and sized. Roofs and accessible terraces are considered to be common areas or for exclusive use.

Conep complains of less economic activity
The president of the National Business Council (CONEP), Lisandro Macarrulla, says that there has been a decline in local production, and job losses. He said this is a serious situation that could lead to social conflict. Macarrulla stated that, "the national business community is very worried in view of the fact that bank credits for the private sector are down and the demand for business loans has fallen in spite of the reduction in interest rates which obviously suggests that a modification in the lowering of expectations and a reduction of the overall demand has taken place." He added that bank liquidity has increased due to a lack of demand and that more than RD$20 billion in the public's savings in the banks is without use, that is to say, unproductive.
He emphasized that bank credits have only increased in the public sector, but not to activate the economy but rather to maintain current state expenditures, which will not help reactivate the productive sectors and will instead create a future problem that could lead the authorities to think of a new tax reform package some time soon. Macarrulla told reporters that instead of complaining that the economic policies have not reacted in time for the last few months and restrictive measures were put into place when just the contrary was called for, now is the time to take corrective measures.

Mexico bound tourists arrive
Thousands of tourists who had planned to vacation in Mexico have been arriving in the Dominican Republic, mainly in the Punta Cana area. In somewhat smaller quantities, tourists have also arrived in Puerto Plata. Tour operators serving both Mexico and the Dominican Republic have been re-routing hundreds of tourists, making the most of the similarities between the Maya Riviera and the Bavaro-Punta Cana region. The increase has meant that May will be a record-breaking month. There has been an estimated 40% increase in the number of tourists arriving in the eastern Dominican Republic.
Mexico, affected by the A(H1N1) or 'swine flu' outbreak, has seen a drastic reduction in the number of visitors to its tourist areas.
According to Hoy newspaper, over 100 additional flights have landed at Punta Cana International Airport. According to the executive vice-president of the National Hotel and Restaurant Association (ASONAHORES), Arturo Villanueva, eight additional flights have landed at Puerto Plata, three at La Romana and "eight or ten" at Las Americas International Airport (AILA).
Villanueva told reporters that he did not have the exact number of passengers arriving, but he said that between 190 and 400 had arrived on each flight.
The flights were mostly from Europe and the United States, carrying tourists who enjoyed Caribbean vacations. Fortunately, according to Villanueva, the country is prepared to meet the heavy influx of passengers, both in infrastructure as well as food and entertainment. The arrival of these thousands of tourists coincides with the lowest season for traditional tourism in the DR. Travel agents in many countries are recommending Jamaica and the Dominican Republic as the destinations of choice for this season.

PROMIPYME could create jobs
The president of the National Traders and Business Federation has asked the government to inject one billion pesos as soon as possible to finance micro, small and medium-scale businesses in the country and so lessen the impact of the jobs lost during the recession. Ricardo Rosario said that the Council for the Program of Micro, Small and Medium Enterprises (Promipyme) is an efficient job creation tool. In addition, the money invested in these areas is not lost since recovery has been 98% plus for years. Speaking to the Hoy media group, Rosario pointed out that these small businesses contribute as much as 12% of the DR's GDP and generate a huge number of jobs, citing as many as 400,000 direct jobs and another 20,000 indirect jobs in the food sector alone. This represents significant economic activity, and yet according to Rosario, there is no government plan to guarantee the stability of the sector. His main point was that through better access to financing, the "pymes" sector could quickly generate jobs at a time when they are needed. The Promipymes also want the government to transfer lots of its own procurement orders now being made for foreign-produced goods to local producers.

Drunk driver to serve sentence
Domingo Antonio Jaime del Pozo, sentenced to two years in jail for the death of 20-year old third semester architecture student Johan Enrique Pou Acta in 2003, will finally serve jail time. Despite the sentence issued in 2006, he went on the run from the law. Pou Acta was killed as a result of careless driving by del Pozo, who was driving a Ford F150 pick-up, and ran a red light under the influence of alcohol. In 2006 his lawyers were able to secure a minor sentence of two years in jail, a RD$4,000 fine and a three-year driving ban. Pou Acta's mother Sandra Acta nevertheless pursued the case and was able to locate him in Miami. Reportedly, he had initially traveled to Haiti, despite a prohibition on leaving the country, and later went on to Miami. An extradition order was secured, and Jaime del Pozo was obliged to return to the DR to serve his sentence.
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