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DOMINICAN REPUBLIC: HIPOLITO MEJIA TAKES OVER AS PRESIDENT.

Hipolito Mejia and Milagros Ortiz Bosch were sworn in Aug. 16 as president and vice president before the National Assembly. The inauguration marked the return to power of Mejia's Partido Revolucionario Dominicano (PRD) after 14 years in opposition, but outgoing President Leonel Fernandez predicted Mejia's presidency would fail.

In the May 16 elections, Mejia won with 49.8% of the vote, defeating governing Partido de la Liberacion Dominicana (PLD) candidate Danilo Medina with 24.9%, and Joaquin Balaguer of the Partido Reformista Social Cristiano (PRSC) with 24.6%.

Mejia promised during the campaign to focus on health, education, and housing and to break the "traditional pattern of corruption" in government. In his inaugural address, he pledged to fight crime, drug trafficking, money laundering, and violations of intellectual-property rights, and to curb police abuses.

He said that resolving the tensions with Haiti regarding Dominican treatment of Haitian immigrants (see NotiCen, 1999-12-16)) would have "high priority." Relations with Haiti would get "all the attention necessary," he said.

He affirmed his commitment to the free market but said, "In developing countries like ours, the government cannot and should not renounce its role of regulator, so as to stimulate competition and facilitate more and better use of resources for the market."

Mejia has promised to review government contracts issued by the Fernandez administration and said he would disavow all concessions made between election day and his inauguration. He said he had received reports about irregularities in some contracts that "worried" him.

Targeted for special attention is Fernandez's handling of the capitalization of the state electric company Corporacion Dominicana de Electricidad (CDE). Private investors in CDE promised to expand generating capacity and pull the company out of bankruptcy. But instead, CDE is still in debt, power outages are daily occurrences sometimes lasting up to 15 hours, while electric bills have gone up.

However, without new legislation, Mejia will be unable to sanction the private generation and distribution companies blamed for most of the problems. Energy officials say the CDE crisis is the fault of the privately owned companies that have refused to invest in new generating capacity.

Marcos Cochon, head of the government's regulatory agency Superintendencia de Electricidad, said he had no authority to sanction private companies that fail to live up to their contract agreements with the government. Under the Constitution, only the legislature can impose sanctions and, since the superintendencia was created by presidential order, its only power is "to supervise."

The problem is that the legislature never passed a proposed regulatory bill with teeth--the Proyecto de Ley General de Electricidad.

For the inauguration, the CDE installed portable generators in the legislature and other inauguration sites in case of a power failure.

Mejia plans to reorient economy

During a visit to Washington before his inauguration, Mejia met with representatives of the State Department and the Inter-American Development Bank (IDB). He reassured the international banking and investment community that his populism did not exclude participation in globalization.

In a news conference at the Overseas Private Investment Corporation (OPIC), he said he and his advisors believed in private enterprise and his administration would continue meeting all international obligations, including payments on the foreign debt. He said he would bring the private and public sectors together to modernize the economy.

Macroeconomic indicators suggested that Fernandez had left the economy in good shape. But Mejia said the benefits had not reached the poorest sectors.

Political analysts consulted by Notimex agreed that Fernandez had fulfilled only half of his 1996 campaign promises. In general, the experts said Fernandez spent far less on social programs than he had promised. In such areas as health, education, potable water, and housing, none received the funds needed to make the promised improvements. Fernandez opted for improving macroeconomic indicators such as inflation and fiscal deficit, but high interest rates suffocated small and medium-sized businesses and held down job creation.

Mejia has pledged to continue some of Fernandez's programs but to "put a human face" on neoliberal policies. He promised to spend 20% of the budget on education and to increase spending on health, extending medical coverage to 60% of the population. He also proposed reforms that would increase agricultural production, improve potable-water service, and build housing for the poor. Mejia says advisors are working on a housing plan, first studying housing for the poor in Japan and other countries.

Fernandez says Balaguer was key to Mejia's win

Meanwhile, Fernandez publicly analyzed what went wrong during the election. Rejecting the view that Medina's defeat was a repudiation of his administration, Fernandez said the PRD had a strong base and had won roughly the same number of votes in every recent election. The variable, he said, was Balaguer.

Fernandez reminded analysts that the PLD had lost every congressional election since 1978. The political reality in the Dominican Republic is that both the PLD and Balaguer's PRSC are minority parties compared to the PRD, and they can win only through alliances against the PRD during runoff elections.

In 1996, however, Balaguer was not a candidate, and the PRSC had to field a weaker candidate whose vote was 12% less than the PRSC's usual performance. In that runoff, Balaguer threw the PRSC's vote behind Fernandez and prevented the PRD's Jose Francisco Pena Gomez from taking office (see NotiSur, 1996-07-12).

With Balaguer back in contention in the May 2000 election, the PRD profited from the failure of the PLD and the PRSC to again form an alliance against the PRD candidate. This time, Medina and Balaguer withdrew after the first round, clearing the way for Mejia's victory.

As for the PLD, Fernandez noted that his party was advancing, having moved from 18% to nearly 25% since 1996. Fernandez expects the PLD to recover the presidency in the next election because of the impossibility of Mejia fulfilling his campaign promises. "There simply are not enough resources to fulfill all those promises," said Fernandez.

In an interview in June with the PLD's official newspaper Vanguardia del Pueblo, Fernandez said the PRD only offered populist solutions. "It is destined to generate dissatisfaction and is condemned to fail," he said. PRD promises to reduce poverty are fine during election time, he said, but difficult to fulfill afterwards. He noted that there was poverty even in France, Spain, England, and the US.

Mejia was taken aback by the prediction of failure even before his inauguration, and accused Fernandez of launching the PLD's campaign for the 2004 election. Fernandez's press spokesperson later said his remarks about the certainty of a PRD failure were taken out of context.

Cabinet named early

Mejia surprised the nation by announcing most of his Cabinet appointments months before taking office. His administration will include relatives, but they will serve without pay, he said. He also announced he would cut his presidential salary by 40% and impose similar cuts in the salaries of high officials. Any official who does not understand the austerity measure should resign, he said.

Officials named so far are:

* Foreign Affairs, Hugo Tolentino Dipp

* Interior, Rafael Subervi

* Agriculture, Eligio Jaquez

* Education, Vice President Milagros Ortiz Bosch

* Public Health, Jose Rodriguez Soldevilla

* Labor, Milton Ray Guevarra

* Sports, Cesar Cedeno

* Culture, Tony Rafael

* Natural Resources, Frank Moya Pons

* Information and Press, Luis Gonzalez Fabra

* Tourism, Alfredo Bordas

* Public Works, Miguel Vargas Maldonado

* Women, Yadiva Henriquez

* Defense, Gen. Jose Miguel Soto Jimenez

Also appointed were Frank Guerrero Prats as central bank president, Juan Vargas, director of housing, and Cesar Sanchez, CDE administrator.

To save money and because Mejia wants to have direct contact with his Cabinet, no minister of the presidency will be appointed. [Sources: Spanish News Service EFE, 05/29/00, 05/30/00, 06/09/00, 06/19/00, 06/20/00; The New York Times, Associated Press, 08/16/00; Notimex, 05/24/00, 08/01/00, 08/16/00; Listin Diario (Dominican Republic), 06/15/00, 06/18/00, 08/16/00; El Nuevo Herald (Miami), 08/15/00, 08/20/00]
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Publication:NotiCen: Central American & Caribbean Affairs
Date:Aug 24, 2000
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