Some industries have closed their doors and others have halted their installation processes. In general, confusion and bewilderment are the main reactions around the areas of Montecristi and Santiago Rodriguez, regarding the effects that the modifications of Law 28-01 will have on the 18 industries already established in the region. According to the Listin Diario, many of the employees are fearful of losing their jobs and others, such as Jose Martinez, a furniture manufacturer, are just plain confused.
Law 28-01 was modified by Law 236-05 which was passed last 22 May. The new legislation says that the industries that were set up under Law 28-01 will have to pay the VAT tax of 14%. Some businessmen who were interviewed by the newspaper said that they agreed with the modifications made by Congress, while others said that they did not have a good grasp of the legislation. The Catholic Church and the common folk from the region are the main protestors against the changes, since they fear that industries will decide not to locate in these, the poorest Dominican provinces. The president of the Association of Frontier Businesses, (ADEFRO), Romulado Estevez, accused the legislators from the seven frontier provinces of selling out on Law 28-01, wiping out the incentives contained in the law for investing in the region. Estevez said that “the modifications will have the effect of reversing the objectives of the law that pursues the creation of a series of opportunities through investment…” Montecristi senator Bernardo Aleman said that Congress did what it had to do in order to save the project. He said that President Leonel Fernandez had asked that the law be rescinded completely in order to conform to the conditions established by the IMF. Aleman complained that none of the 17 pending requests by industries to enter the area under the aegis of Law 28-01 have been qualified as yet and he felt that this was worse than what the Congress did to the law itself. A total of 132 industries have applied for permission to enter into the zone and operate. So far 40 have begun the process of installation and there are 18 industries now producing. Total investments have reached US$500 million and 4,500 jobs have been created. There are two industries in Pedernales, four in Jimani, and 12 in Santiago Rodriguez, Hatillo Palma, Monte Cristi and Villa Vasquez.