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Daily News - Friday, 21 August 2009

Government housing in Barahona
President Leonel Fernandez was in Vicente Noble, Barahona yesterday to inaugurate a 6-building 36-apartment complex built at a cost of RD$79 million. During the event, the government announced it would build 15,000 more homes by 2010 if a financing program with Colombia is approved.

Homes of the poor won't pay taxes
Homes that have a value of RD$1.5 million or less will not have to pay the 16% ITBIS tax, according to a new decree issued by President Leonel Fernandez. Decree 611-09 creates a RD$200 million fund so that these homes can be purchased without paying the ITBIS tax. The decision seeks to stimulate the construction of more low cost housing. The ITBIS program will be valid through 31 December 2010.

Deficit is almost RD$10 billion
It's RD$9,915 million or RD$9.9 billion and not RD$915 million, Hacienda Minister Vicente Bengoa clarified yesterday. News reports had carried the erroneous figure. Hacienda has published online figures indicating that the government received RD$113.08 billion and spent RD$109.56 billion, for a surplus of RD$3.5 billion. But economists corroborate the deficit is at RD$10 billion, as reported in Diario Libre.
Luis Nunez, president of the Association of Mercants and Industries of Santiago (ACIS) called unsustainable the government's announcement it would cover the gap between spending and revenues by borrowing is unsustainable. He called instead for a reduction in government spending, that government adjust to the having less sales taxes and other taxes, as well as sliding imports and exports.
He said the business community is concerned the country take on more loans because these are used at discretion of the government.
Pedro Perez of the National Organization of Malls (ONEC), Ignacio Mendez of the Federation of Industrial Associations (FAI), and Manuel Cabrera of the Association of Industries of Herrera (AEIH) corroborated the concern.
As reported in Hoy, Perez and Cabrera object that the government issue sovereign bonds. They feel the cost of these will be too high. Instead, they suggest the government reach an agreement with the International Monetary Fund. They understand the IMF will offer funds at a lower cost and will help curb unnecessary government spending.
Cabrera says the business sector has always called for austerity in government, but the government has been deaf to their request.
Furthermore, economist Isidoro Santana says that borrowing is not necessarily bad. "It would not be harmful if the money were used well," he said as reported in Hoy. He explained that the concerns are because of the government's track record in the misuse of the foreign loans.

Talking education
President Leonel Fernandez led a discussion at the Presidential Palace yesterday on quality in education in the DR yesterday. Fernandez called the meeting "historic." "When in the history of the Dominican Republic has the Presidential Palace been the site of such an enlightening discussion?" he wondered.
Fernandez said he is counting on financing from the World Bank or the Interamerican Development Bank for future education plans in the DR.

No money for social programs
Large public works projects are underway in the city of Santo Domingo, a demonstration of the city's rapid growth. These works also give the impression the government has the money to complete these and others. But Vice President Rafael Alburquerque says the budgetary deficit is forcing the government to cut back on new affiliates to its social programs, such as the solidarity cards and the bonagas cards. Alburquerque said these programs would have to wait until 2010 to reach out to more people.

US cars tax free
US-manufactured cars will have a major competitive advantage in 2010 in the Dominican market. The time has come for these to pay zero tariffs, as stimulated in the DR-CAFTA free trade agreement.
Enrique Fernandez, director of the Association of Car Dealers (Acofave) is concerned this could affect sales of Asian or European cars.
At present, US-made cars have a 10-15% market share.
DR-CAFTA stimulated zero tariffs in the fifth year of the treaty. The treaty was signed in August 2004. Vehicles at present pay a 20% tariff.

Give up the "green"
A long-standing practice is for Dominican Presidents to appoint US residents and Dominican-Americans to diplomatic posts in the US. The appointees forego protocol and keep either their US citizenships or residency status.
It is illegal under US law to be a citizen or resident of the US and be employed with diplomatic status at an embassy of another country. In many cases the US State Department will just not recognize the legitimacy of the appointed consul, for example.
The matter is back in the press after President Leonel Fernandez appointed Rafael Evans as the new Dominican consul in New York.
The US State Department has officially requested that Evans give up his residency status in the US, something he has had for 15 years. This is a pre-condition to his being recognized as consul in the US by the State Department.
A similar situation affected Dominico Cabral, who was appointed Dominican consul in Massachusetts. As reported in the press, Cabral chose to give up his US citizenship when he was named to the post.

DPCA files charges
The National Department for the Persecution of Administrative Corruption (DPCA) has filed charges against Jose Lois Malkun (former governor of the Central Bank), Felix Calvo (former vice governor of the Central Bank), Cesar Apolinar Veloz (former manager of the Central Bank) and Manuel Rubio Cristoforis (former judicial consultant) for the embezzlement of RD$10 billion in regards to the now defunct Bancredito.
Listin Diario explains that problems with Bancredito arose in 2003, when the bank was having issues with liquidity, which later resulted in insolvency. The Central Bank agreed to front the bank funds in excess of RD$20 billion. It was later determined this violated the Monetary and Finance Law 183-02.
At the time, Malkun was named as guarantor of offshore affiliates, which was illegal under Law 183-02. Malkun would receive 18 payments, totaling RD$10 billion, for the titles of credit portfolios for the Bancredito affiliates that were being purchased by the Dominican state. The funds were transferred to Artag Meridian Ltd.
The charges indicate that these monies were in fact used by the accused to illegally settle other accounts.
Malkun was named head of the Central Bank by then president Hipolito Mejia, in 2003.
Responding to the charges, Malkun called them absurd, saying: "That accusation is absurd, and holds no bearings. It is a demonstration that in this country it is better to steal public funds, and not meddle with the status quo, because doing so has a high price."
He added there is no official document that can substantiate the accusations against him.
Malkun maintains his innocence, saying he was the one who had original told DPCA that audits and investigations needed to be done.

Debate on penalties for minors
Whether or not to harden the penalties against minors involved in crime is being debated nationwide.
The Police has said that minors are involved in six of every 10 crimes in Santiago. The National Drug Control Department office in Santiago says that in April alone, 27 minors were arrested for drug trafficking. Santiago police says they frequently arrest minors ages 15-17 for stealing a handbang, cell phone or jewelry, and there have been cases of armed assault. In those cases, the minor is usually accompanied by an adult.
One known gang in Santiago, Los Meneitos is made up of children 9 to 17 years, that are required to leave the gang once they reach 18 years.
Minors, or those under 18 years, can be penalized with a 5-year maximum jail term, and thus are increasingly being involved in crime.
The state prosecutor for children, Miguelina Rodriguez confirmed minors are increasingly being used as mules for drug trafficking. Nevertheless, she says that the participation in youth gangs have been reduced with recent efforts.
The National Council of Business has proposed that the Minors Code and the Penal Code lower the age for penalizing youths. Lisandro Macarulla, as reported in El Caribe, says that not only is there the need to modify the codes, but also for the state to concentrate its security forces and energies on the causes that lead to crime.
Ramon Emilio Nunez, director of the national school of prosecutors, does not feel the matter will be improved byhardening penalties against minors.
UNICEF issued a statement opposing reforming the minors' code, Law 136-03 on grounds that by passing responsibility unto the minors the problem of crime is not resolved.
Commissioner for the Reform and Modernization of Justice, Lino Vasquez Samuel said that what should be done is to increase the penalties on adults that involve minors in crime.
The president of the National Council of Drugs, Mabel Feliz proposes that instead of increasing penalties for minors, more responsibility and fines be levied on the parents fornot fulfilling their roles.

Praise for Rolando Rosado Mateo
Peravia Senator Wilton Guerrero congratulated President Leonel Fernandez on recent actions to combat drug trafficking. Speaking at the Senate, he praised the appointment of Police General Rolando Rosado Mateo as new director of the National Drug Control Department (DNCD).
The senator congratulated the officer saying his track record was one of honesty and for maintaining a straight line against corruption and crime throughout this career in the Police.
Guerrero spoke at the Senate yesterday, stressing that to fight crime there is a need for firm actions from all government institutions. He called drug trafficking a common denominator of crime cases in the DR.

Fraud at Indhri
The Cooperative Credit and Development Institute (Idecoop) has frozen the bank accounts of the National Institute for Hydraulic Resources (Indrhi) after discovering that Indhri was using the funds of its employees deposited in the cooperative. Pedro Corporan, director of Idecoop, explained that during the administration of Hector Rodriguez Pimentel, employees funds were allocated to Indrhi operations. President Leonel Fernandez moved Rodriguez Pimentel to the Dominican Agrarian Institute (IAD) last week, after weeks of investigative press coverage revealing proofs of widespread corruption while he was at the helm of Indrhi.
Idecoop is now asking Indrhi to pay up RD$12 million so the cooperative doesn't go bankrupt due to illiquidity.
Indrhi's new director, Frank Rodriguez, is asking for a court order so he may regain access to the Indrhi bank accounts.

The Vianco Martinez case
The National District's District Attorney, Alejandro Moscoso Segarra, explained that since journalist Vianco Martinez did not present a doctor's certificate, verifying his attack, no judge will be able to prove the charges of physical harm in the case he maintains against two bodyguards of impresario Saymon Diaz. Moscoso is responding to comments that the D.A.'s office has been negligent to move in prosecuting Martinez's case of abuse against a journalist. The D.A insists that the injuries need to be verified.

Shortwave community meets here
The short wavebroadcasting community has been meeting in Punta Cana this past week. The B09 HFCC/ASBU Conference is held at the Dreams Punta Cana. The HFCC, also known as High Frequency Co-ordination Conference, is a group active in informal co-ordination of frequency channels used in short wave broadcasting. The group co-ordinates transmission schedules of about 60 organisations from more than 30 countries. They represent about 75 to 80 percent of the global output of short wave broadcasting.
The event was sponsored by the National Association of Shortwave Broadcasters (NASB), the IBB, Continental Electronics, Thomson Radio Broadcast, Inc., and the DRM Consortium, and the Dominican Telecommunications Institute (Indotel).

COE raises alerts
The Center for Emergency Operations (COE) raised the alert levels to yellow for the provinces of Maria Trinidad Sanchez, La Romana, La Altagracia and Puerto Plata due to the increased potential of flooding. The alerts were upgraded yesterday due to the passing of Hurricane Bill. Though Bill is passing near Bermuda today to the north, but the DR is expected to still feel the effects of winds, swells and rains produced by the outerbands of the storm.

Old-timers on stage
The favorite Hispanic ballad singers of the 70s and 80s are including the DR in their world tours for this year. On the list of those who are coming is Raphael de Espana, Jose Luis Rodriguez, Jose Luis Perales, Danny Rivera, Camilo Sesto and Alberto Cortez among others.
For when and where they will be performing, see http://www.dr1.com/calendar
 
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