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Daily News - Monday, 27 July 2009

Choosing the candidates for 2012
On Saturday, President Leonel Fernandez met with five of six PLD aspirants to the presidential candidacy for the party in 2012, former Secretary of the Presidency Danilo Medina, Tourism Minister Francisco Javier Garcia, Interior & Police Minister Franklin Almeyda, Civil Aviation Institute director Jose Tomas Perez, and the vice president of the State-run Electricity Companies (CDEEE), Radhames Segura.
Also invited was former Vice President Jaime David Fernandez, currently the minister of Environment, who did not attend.
A PLD party press release says that the guidelines for choosing the party's candidates for the 2010 municipal and congressional election were discussed. President Fernandez, who is also president of the PLD, headed the meeting.

Turtles released
The Ministry of Environment (SEMARENA) has released 150 turtles into the sea at Guibia beach in Santo Domingo. The turtles had been born in several nests in the provinces of La Altagracia and Samana. The Ministry is still monitoring a series of other turtle nests to ensure their full development.

Two billion in four years
The State-run Electricity Companies (CDEEE) indicates that in the last four years it has received US$2.7 billion, which has been divided up among the energy distributors and their corporate units.
El Caribe reports that a substantial part of those funds was used to cover expenses related to the application of "official social policies" and to compensate losses related to contracts signed with independent energy producers.
Of the total money given to the CDEEE, US$806.7 million was given to EdeNorte, US$774.4 million to EdeEste and US$649.4 million to EdeSur.
Also, the Corporate Unit of the CDEE has received US$500.1 million and the Stabilization of Price Fund (FET) has received US$524.99 million, while the Blackout Reduction Program (PRA) received a total of US$419.41 million. The PRA was closed after investigative journalist Nuria Piera denounced widespread corruption.
The CDEEE admits that 70% overpricing and losses to the independent energy producers has resulted in a loss of more than 70% of the money handed to the energy sector.

Natural gas and wind projects
National Energy Commission director Aristides Fernandez Zucco says the construction of a natural gas plant that would produce 600 MW of energy and a wind power project that could produce as much as 600MW more energy will begin this month after the necessary agreements are signed. Zucco announced that a delegation from the United Arab Emirates (UAE) is in the country putting together the final details of the agreement. He added that Juan Ormazabal from the Spanish Renewable Energy Council is heading the commission of UAE representatives, and is also representing an investment fund in the UAE. Fernandez says that the UAE will invest a total of EUR500 million in the DR's energy sector through the gas and wind power projects. The wind farms will be located in Puerto Plata, Monte Cristi and Azua. There are also talks about a second UAE agreement that would pave the way for a natural gas plant that will inject 600MW of energy, involving an investment of EUR700 million.

Looking at the debt
Although the government has been able to reduce its external debt by US$107.2 million or 1.5%, it has increased its internal debt by US$202.5 million, or 5%.
A report by the Hacienda Ministry's Public Debt Department revealed that at close, on 31 May 2009, the external debt totaled US$7.129 million, down from US$7.237 million in December 2008.
The report indicates that the global public debt has risen by 0.8% going from US$11.2 billion to US$11.33 billion, which is equivalent to 25% of the nation's GDP, meaning that for every US$100 produced in the country, RD$25 goes towards debt.
The report also indicates that internal debt went from US$3.998 billion to US$4.201 billion during this period.
The government has taken on US$7.1 billion in total debt, of which US$3.753 billion is from bi-lateral agreements and US$1.8 billion are with multi-lateral organizations. The DR has entered into agreements with the International Monetary Fund (IMF), the World Bank and the Inter-American Development Bank (IDB).
The debt as a product of bonds totals US$1.12 billion, a reduction of US$52.8 million, or 4.1%, since December.
The internal debt with commercial banks equals US$850 million, during the first five months of the year, while recapitalization of internal bonds has totaled US$2.3 billion. In relation to the nation's GDP, both internal and external debts have increased, with the internal debt increasing by 9.4% during the first five months of the year, while external debt has increased by 16% as a product of the GDP.
When Fernandez returned to government in August 2004 the public debt was US$9.59 billion.

Just too many deputies
The Dominican Republic has by far the highest number of legislators in relation to its population in the Americas. The Constitutional Revisory Assembly is proposing to increase the number of members of the Chamber of Deputies to 190, up from 178. There are an additional 32 senators.
A report in today's El Caribe describes this as a heavy economic burden on the state. "And worse, still, it marks the continuation of a clientelism in government, perpetuating the old models due to the amount of power and money.
El Caribe reports that the increase will just serve to feed the expectations of those who want to get rich through their government jobs that enable them to handle large sums of taxpayer money at their discretion, despite the current financial crisis.
There had been a move to reduce the number of deputies to 150 or at least leave it at 178, but this was not considered. In his constitution revision bill, President Leonel Fernandez had proposed that there should be a minimum of 175 or a maximum of 250 members.
Fernandez also proposed an additional seven deputies to represent Dominicans abroad.
El Caribe reports that 12 more deputies will mean an increased monthly expenditure of RD$2,286,270 for the government. This brings the total the government will have to pay in cash to the legislators to RD$36,199,275 in cash payments alone. Reporter Oscar Quezada makes the point that this amount does not include money handled at discretion by the legislators for social commitments with the communities they are supposed to represent, or the staff they are assigned, such as chauffeurs, secretaries, personal assistants and PR staff.
Only Brazil with 513 deputies (pop 194 million), Mexico with 500 deputies (pop 108 million) and Argentina with 256 deputies (pop 43 million) have more deputies than the DR, with its population of 10 million.
The reporter also makes the point that a deputy makes 74 times the minimum wage in the DR, at RD$175,474.65.
Javier Cabreja of the civic society group Participacion Ciudadana says: "All this responds to a clientelistic practice that has taken hold of the Dominican political system. Government institutions are used as a way of contributing to certain people who participate in politics and these positions are created to cater to the needs of political parties."
In addition to the 178 deputies, at present there are 32 senators.

Dominguez Brito has surgery
Senator Francisco Dominguez Brito has undergone a second surgical procedure in an eight-day period. Dominguez had his first surgery at the Corominas Clinic for intestinal blockages last week, and doctors there announced that the Senator for Santiago and former attorney general was on the road to recovery.

Lack of will to fight corruption
Political analyst Rosario Espinal says that President Leonel Fernandez has not enforced any decisive measures against corruption. "A constant of President Fernandez's government has been to not to want to tackle or confront special interests either of the board of the PLD or of the country's powerful economic or social sectors," she said, during an interview on TV talk show El Despertador, as reported in El Caribe.
She criticized the way that Fernandez has given himself little leeway in dealing with members of his administration. She said that situation comes at a time when Fernandez's political opposition is "anemic and with as many weaknesses in the area of corruption."
Espinal's comments come only days after the President, in a meeting with members of the press, played down the existence of corruption in his administration, saying that it was weakness and irregularities, not corruption, that were the problems.
She forecast that the 2010 municipal and congressional election would be irritating to the population if the economy does not improve. She predicted that these would be times of excessive government spending.

Half measures for corruption?
The Herrera Industries Association (AEIH) and the Federation of Industrial Associations (FAI) support the transparency pact with the private sector proposed by President Leonel Fernandez during last week's meeting with the press. However, they stress that they are not questioning the lack of laws and mechanisms for fighting corruption in government and for stimulating transparency in government.
As reported in Hoy, these organizations are vocal about the fact that there has been permissiveness by the government and a lack of will to penalize corruption. They urged President Fernandez to refrain from employing half-measures when handling government corruption.
Manuel Cabrera and Ignacio Mendez say that the country has the legal framework to counteract corruption, but the political will and a serious commitment by the state has been lacking when it comes to enforcing the law. They criticize the fact that several government officials make use of government funds as if it was money coming out of their own pockets.
"Let us hope that the latest words from the President will not be a simple box of good intentions and that they become reality, because there are enough reasons for that to happen," stated AIHD and FAI when outlining their position on President Fernandez's comments about corruption in his government. They urged the government to pass from theory to practice and oblige all government institutions to post information on the budget management, purchase operations and other transactions on the Internet so the general public can judge their performance.

New age in collecting, old age in spending
Writing in Saturday's Hoy newspaper, Manuel A. Brugal comments on the way that the PLD administration has been very successful in implementing measures to reduce tax evasion to new record lows, especially at the Department of Taxes (DGII) and the Department of Customs (DGA).
He praises these efforts on the grounds that by making tax payments universal, the tax collection system is fairer, and it reaffirms the fact that all citizens are equal under the law.
Furthermore, it has succeeded in reducing unfair competition by companies that can compete on price because they don't pay taxes or benefit from contraband, or have a strong market position based on years of tax evasion.
And, he says that it helps make banking information transparent and sets correct credit rating information.
He also makes the point it gives businesspeople more space to have an opinion and actively participate in public discussions, because they cannot be blackmailed by the tax department. And finally he states that the government would have more resources for fighting poverty and providing incentives for exports, without whose growth we will not be able to defeat underdevelopment.
Thus he says that the efforts to reduce tax evasion are revolutionary.
But then he drives home the main point of his article. While he can applaud the tax collection efforts of the government, when it is time to spend these revenues this is done in a socially inefficient way, giving priority to the short-term political use of these funds, instead of using it to reduce our enormous social debt.
"And what is worse, a significant part of these funds is distributed through the corruption network and through the clientelism that is constantly fed by the government."
He concludes that this then discredits all the previous efforts, and the tax collection efforts loses legitimacy, because no one wants to pay taxes that will be thrown out the window.
"That will lead to a weakening of the government efforts to collect taxes and it will make it easy for another government to dismantle all the good work that has been done, because no one is going to defend something that is fraudulent.
"With its dual behavior, the government tells us that the modernism it has brought to tax collecting is not to modernize the country or to fight poverty, but to feed the primitivism in its spending, and in a poor country that is socially insensitive."

New auto sales fall
Car dealers association ACOFAVE says that sales of new cars have fallen by 59% so far this year compared to 2008. Enrique Fernandez, executive director of Acofave, forecasts that new car sales will only total 12,575 units in 2009, while in 2003, previously the worst year to date for car sales, 12,941 new vehicles were sold in the DR. He added that in April, May and June 2009 40%, 51% and 53% fewer cars were sold in comparison to the same months in 2008.

Bi-national market closed
The bi-national market, which takes place every Monday at the Dominican-Haitian border in Dajabon, will be closed today, after the fatal shooting of a Dominican man by a Haitian national.
El Caribe reports that Haitians are protesting through the legal mechanisms in their country, while UN MINUSTAH guards have been patrolling the area near the border towns. Conflicts have been brewing since last week and there were reports of physical altercations last Friday between Dominicans and Haitians who were trying to sell their goods.
These incidents resulted in the death of 23-year old Carlos Espinal Jimenez. Destine Wilson (Chipa) was one of the men arrested in connection with last week's attacks, but Haitian authorities in the town of Ouanaminthe say that he will not be released because he was arrested in Haitian territory and has pending legal issues in the country.
The reason for the killing is suspected to be that the Haitian attacked the Dominican to steal his motorcycle, according to Hoy. The Haitian, Destine Wilson, is under arrest at the Ouanaminthe police station.

DR silver in Volleyball World
The Dominican Republic girls' volleyball team has won the silver medal in the FIVB Women's Junior World Championship, after losing to Germany in the final. Germany won a 28-26, 26-24, 25-16 victory over the Dominican Republic on Saturday night at Auditorio del Estado in Mexicali. Brazil took home the bronze medal.
"It was not easy to win the championship even though we didn't lose a match along the way," said Han Abbing, the German coach. "The first two sets were really a battle but we kept the focus and came out winners. That really helped us for the easy third set."
The previous best finish of the Dominican team was a 9th place on four occasions.
The Dominican team had dethroned six-time champions Brazil on Friday night, outlasting the six-time monarchs with a convincing performance 25-21, 27-25, 23-25, 25-15.
Dominican Brenda Castillo was honored Saturday night as the Most Valuable Player of the FIVB Women's Junior World Championship.
Journalists covering the competition as well as the members of the Control Committee took part in the voting process. The tiny but multi-talented Castillo of the runners-up Dominican Republic was also selected as Best Digger, Best Receiver and Best Libero of the world event won by Germany.
The final positions of the championship were: Germany, Dominican Republic, Brazil, Bulgaria, Chinese Taipei, Netherlands, Turkey, Mexico, Cuba, China, Czech Republic, United States, Poland, Thailand and Venezuela.
 
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