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Daily News - Tuesday, 23 June 2009

Deduct tuition from income tax
President Leonel Fernandez has published Law 179-09 that allows parents to make their unemployed children's school tuition tax deductible. The law permits deductions for grade school and university studies.
It requires the tuition to be documented with Tax Department (DGII) authorization numbers (NCF) by the educational institution and should be no more than 10% of the total income subject to taxation.
Furthermore, the law establishes that when employers support employees with tuition payments to their dependents, these will not be subject to complementary taxation when they are granted to employees within the non-taxable bracket.

Municipality wants to enforce zoning
The National District municipal authorities (ADN) will try to put a new set of zoning regulations into effect, aimed at controlling land use, building heights, property demarcation, parking and sidewalks.
In the announcement made yesterday, Mayor Roberto Salcedo said he was submitting a set of regulations called Zoning Indicators on Densities to the City Council.
The Mayor said that the regulations have been drawn up taking existing buildings into consideration. But, he said that in the future the new set of rules would restrict population densities to keep with what is appropriate for the area.
ADN technical secretary Andres Navarro presented the zoning plan to the municipal council.
Although no details have been released to the press, Hoy newspaper said that the ADN would hold public hearings on the new zoning laws.
Anyone who has tried to drive in the city of Santo Domingo will appreciate how the growth of apartments and high-rises has increased the population density in areas formerly dominated by one-family houses to bursting point.
Salcedo added that the new rules would also tackle the infamous "colmadones" and other businesses that generate noise and traffic.

Pay hikes can't wait
Leading labor expert, Vice President Rafael Alburquerque warned on Monday that according to the Labor Code the legal minimum wage has to be revised every two years. He said that this is why there could be no more delays and stalemates in the negotiations between labor and management.
He is optimistic that an agreement can be reached. The Vice President, who was involved in drawing up the current Labor Code, said that the stalemate that has held up the negotiations has to be overcome and a solution found.
Alburquerque said: "It is a question of finding a number, if it is going to be 20, 10, 12 or 15%. Whatever, it has to be done as fast as possible."
Interviewed at the Presidential Palace, Alburquerque pointed out that the Salary Law calls for an increase in the minimum wage, and if the minimum wage is increased, then there will be increases in the other salaries as well.
Alburquerque also talked about the government-sponsored Bono-Luz welfare program that is being worked out with the Superintendent of Electricity, Francisco Mendez, in the hope that the program can be implemented by July.
El Nuevo Diario interviewed Rafael (Pepe) Abreu, who chairs the labor sector negotiators at the meetings of the salary discussions. Abreu told reporters that if management was willing to offer an across-the-board 12% wage increase for all workers earning up to RD$30,000 a month, his people would accept such an offer.
At last notice, management had offered a 12% increase in the minimum wage for private sector employees.
Abreu mentioned that workers wanted a 25% wage increase for those earning less than RD$20,000 per month.
The president of the Dominican Management Confederation (COPARDOM), Marisol Vicens, has said that management is only willing to increase the minimum wage, as required by law.
Minimum wages in the Dominican Republic vary according to the size of the business or industry. The minimum wage at the larger companies is RD$7,360.

Tourism up a tiny bit in May
Tourist arrivals to the Dominican Republic were 2.41% higher in May 2009 compared to the same month in 2008. This good news comes after ten consecutive months of lower numbers, according to data published by the Central Bank on their website. In May this year, 6,972 more tourists arrived here than in the same month in 2008. The volume of tourists was attributed to two main factors. The first was a slight increase in the arrival of non-resident Dominicans - 4,434 more visits this year than last, for a 1.03% increase. The second factor was the re-routing of many tourists from Mexico to the Dominican Republic as a result of the influenza scare. Many of the companies that send tourists to Mexico have operations in the DR. The non-resident foreigner segment accounted for 1.38% of the increase.
See http://www.bancentral.gov.do/estadisticas.asp?a=Sector_Turismo

Duarte Hwy re-opens
The Ministry of Public Works announced yesterday that the area around north-bound kilometer 62 of the highway, near La Cumbre (just past the Police Station) was re-opened to traffic on Sunday. The area had been closed for several months as Public Works crews replaced drainage pipes that had become clogged with debris and sediment.
The work consisted of the excavation and extraction of the old steel culverts and the placement of 60-inch re-enforced concrete pipes.
The Ministry announced it had spent RD$101 million on the repairs.
The Minister of Public Works said that the work was completed on time, despite the constant rains in the area, and taking into account the difficult terrain.
The repairs are part of a ministry program of repairs and refurbishing the highway's drainage system that began in 2007.
The old metal culverts suffered from crushing due to the accumulation of sediment and the wear of corrosion.
The Estrella Engineering Company was in charge of replacing the old culverts along the Duarte Highway.
The open roadway now avoids the seven-kilometer detour that started at the Police station and ended at Arroyo Vuelta I further up the highway.

AmCham: Government should regulate
The American Chamber of Commerce (AmCham) said yesterday that the Dominican state has gone from being a regulator in the hydrocarbon and electricity sectors to becoming the dominant economic actor.
In a press release, the chamber maintains that this sends a worrisome signal to the people in the private sector and is likely to have a dissuasive effect on decisions concerning direct investment in these agents in these areas.
The statement issued by the AmCham, according to El Caribe, underlines the proposal to sell 49% of the shares of the state-owned Dominican Petroleum Refinery to another country's similar state agency (Petroleos de Venezuela - PDVSA) as of particular concern. Moreover, the growing dependency on one supplier of such a strategic product such as petroleum-one of the prime motivations for the deal-"exposes the country to a significant risk and calls for reflection... given the limited storage facilities that the country has, any interruption in supply, for any reason whatsoever, would paralyze the local economy."
The AmCham goes on to say that it had alerted when the Dominican government acquired the 50% share that belonged to the Shell Company, pushing aside any private participation in the operation, that this could create inefficiencies and distortions in this strategic sector of the economy.
The AmCham press release mentions the acquisition of power distribution company Ede-Este by the government was arguably as a way of ending a messy series of lawsuits, but has added to growing concerns on the reversal of privatization.
Finally, the document says that for the country to continue to progress and compete, the role of the state has to be clearly defined. The business group advocates that this role be one of establishing norms, of promotion, of a regulator and of a controller.
The proposal is for the sale of Refidomsa for US$130 million, to be paid in oil supplies. Listin Diario reports that the purchase could include Opuvisa, the propane gas deposit in Azua that would add another US$25 million to the purchase.

Finjus: Refidomsa tender by law
The Institutionalism and Justice Foundation (Finjus) said yesterday that the Dominican government is legally obliged to make a public offer in the sale of shares in the Dominican Petroleum Refinery (Refidomsa).
Finjus executive vice-president lawyer Servio Tulio Castanos Guzman said that there is no special rule in the Dominican administrative legislation on the sale of incorporated assets, such as the sale of shares that are property of the state in corporate entities.
He pointed out that for this type of asset the provisions of Article 5 of Law 340-06 apply, thus obliging selection procedures to be followed. He said it was 'inappropriate' for the government to exclude the contracts of private law.
Lawyer Mariano German has gone on record saying that the shares sale did not have to go to Congress and was not subject to any obligation of being offered for tender.

Debt climbs US$3 billion in 3 years
In just over three years, government domestic borrowing is up by US$3.08 billion. It increased from US$1.11 billion to US$4.19 billion from 2006 to 20 April 2009, as reported in Diario Libre today. The domestic public debt of the government in 2006 was US$929.1 million.
Of the debt, most is held by the Central Government itself, with US$3.9 billion, according to data from the Ministry of the Hacienda's Public Credit Department.
The internal debt, measured as percentage of the Gross Domestic Product (GDP), using 1991 as the base year, increased, according to the data from 3.1% in 2006 to 8.8% as of 20 April 2009. In 2007 it was set at 2.7% of GDP and in 2008 it was at 8.7% of GDP.
The debt is broken down with US$871.3 million owed to commercial banks, US$729.1 in bonds and US$2.3 billion in recapitalization bonds.
The Non-Financed Public Sector Debt (SPNF) reached US$290 million this year.
The total of the Central Government's debts equals US$3.903 billion plus the Non-Financial Public Sector, which is US$290 million, for a total of US$4.19 billion in domestic public debt.
The Citizens' Alternative Forum complained that the domestic debt had already increased from US$460 million in 2000 to US$3.6 billion in 2008.
According to the Forum, most of the spending has been superfluous. During the same time, the foreign debt increased by US$5.3 billion, going from US$2 billion in 2000 to US$7.3 billion in 2008.

Lots of casinos
Gambling is gaining ground in the country. In addition to the sports betting parlors, casinos have taken a big leap, going from 20 in 2005 to the 56 currently in operation, reports today's Diario Libre.
This increase has been accompanied with illegal activities and more than one of these establishments is operating without the permits and requisites as required by Law 351, and this is why several licenses have been canceled, according to the report.
At least two casinos are going up in the city of Santo Domingo without licenses and another two are operating without the established requisites. Such is the case of one being built on the San Isidro Highway on the site of the former Blue House restaurant, and for which the Ministry of Hacienda Casino Department has yet to issue a license.
The same thing is happening with the casino that is going to be built in the installations of the old Agua y Luz Theater, whose promoters, Dawn Properties Ltd. have not managed to recover the license revoked by Hacienda in 2005.
According to Article 1 of Law 351, the Executive Branch is allowed to grant licenses for "the establishment of gaming rooms in first class hotels and other places, also first class" that are for the use of tourists. In Article 2 of the law, it is established that for the authorization of the gaming centers, the location, installation and money invested must be examined, and that the Casino Commission created for this purpose has to verify that these can classify as being of first class standards and meet the international requisites acceptable for tourist development.
Director of casinos Conrado Abud said that in the case of the casino at San Isidro, it is awaiting the construction of a hotel on the location before issuing an authorization.
Nonetheless, the Princess International, located on 27 de Febrero Avenue, and open to the public since last December, has a license to operate without any sign of a hotel there or nearby.
Abud justified this by saying that the licenses are granted only with the presentation of plans and a detailed description of the investment.
He added that the Princess has been notified that it has a six-month deadline, of which four months have elapsed, to either build a hotel or lose the license.
Another that had its license revoked was the casino at the San Geronimo Hotel, after the hotel closed down, but it is still operating, as a simple "gaming room", according to Abud. At present, casino owners are supposed to pay RD$10 million for a license, according to a resolution by the Ministry of Hacienda dated 12 August 2008.

A 3.5 quake shakes Santiago
An earthquake registering 3.5 on the Richter scale was felt in Santiago and other locations in the north of the Dominican Republic on Monday afternoon. The data analyst at the Seismological Institute at the Autonomous University of Santo Domingo (UASD), Felix Martinez said that the quake occurred at a depth of 22 kilometers and at 19.4 degrees North and 70.6 degrees West longitude.
The seismic movement was registered at 22:15 GMT (6:15 local) according to the Emergency Operations Committee (COE) and Civil Defense.
The regional director for both organizations, Francisco Arias, told El Nuevo Diario that there were no reports of injuries or other damage as a result of the earthquake.
This is the second small earthquake that has been felt in the area in less than a month.
According to Orlando Franco, a prominent Civil Engineer and student of Geology, these movements are part of an area of great seismic activity that surrounds a fault line located in the Septentrional Mountains (Northern) and which includes the provinces of Santiago, Puerto Plata, Valverde (Mao), Salcedo and Duarte.

One missing, 11 homes collapse
One person was swept away by floodwaters caused by rains that have been falling in the Cibao and 50 houses were flooded in the province of Santiago, according to Civil Defense director Francisco Arias.
The missing person was identified only as Rey, who was trying to cross the Arenquillo River in Villa Gonzalez on a mule when they were swept away.
Besides this, 11 houses collapsed when several streams and rivers burst their banks, bringing the total to 61 homes felled during the last nine days. These homes were located in high-risk areas.
Arias, who also represents the COE in the area, said that the rains that fell yesterday and that are forecast to continue today destroyed houses in Los Guandules, Hoyo de Bartolo, Los Salados, Los Platanitos, Puchula, Las Mercedes, La Javilla and Cantala.

Dutchman deported in big scam
The Prosecutor General's Office has recovered EUR11 million of the more than EUR22 million that was swindled by a supposed international network composed of two Dutch nationals who have been arrested in the DR. They are believed to have cheated 900 investors in the Benelux countries and escaping to the Dominican Republic.
According to Diario Libre, the Dutch authorities notified the Attorney General of the investment of EUR11 million in laundered money, which enabled the authorities to act through the Anti-Laundering of Assets Unit.
The money was reportedly invested in a series of unnamed companies and properties that the authorities are investigating, according to the director of the Anti-Laundering Unit, German Miranda Villalona. Diario Libre reports that Miranda said that Dutch nationals Gerd Pol and Nike Eddie were involved in the scheme, and they were arrested for marketing real estate and offering plans for projects that were never built.
Pol was arrested in a tenth floor penthouse on Anacaona Avenue. He was deported to Holland to face the accusation against him, while Eddie was questioned and released.
Miranda said that the alleged swindlers fostered false hopes for investors, to the point of diverting the money to their personal expenses and into other companies of their property.
Four officials from the financial investigations unit and a prosecutor from Holland are in the country looking into the case.
Dutch investigating officer N. Hemelaar said that Pol has been wanted for investing money in a resort in the DR since 2000. "From 2000 until now, of all these projects, nothing has been built and the money has disappeared."

Hairspray back at TN
Newspaper reviews for the presentation of Hairspray in Santo Domingo have been so good, the musical is returning for two more nights at the National Theater. The musical is back on for Friday, 26 June and Saturday, 27 June.
Laura Leclerc and Irving Alberti, Kenny Grullon, Frank Ceara, Cuquin Victoria, Claudia Sierra, Robmariel Olea are in the starring roles.
This is a Nuryn Sanlley production based on the John Waters film. The musical had won 8 Tony Awards, a Grammy and was on stage for 7 years at the Neil Simon Theater in Broadway.
Tickets are for sale at the National Theater box office 10 to 6pm.
For more on ongoing events, see http://www.dr1.com/calendar
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