US embassy cable - 05SANTODOMINGO5213

UNCLAS SECTION 01 OF 02 SANTO DOMINGO 005213 
 
SIPDIS 
 
SENSITIVE 
 
DEPT FOR WHA, WHA/CAR, INR, EB/TPP/BTA/EWH; 
PASS USTR FOR R VARGO, A MALITO; 
USCINCSO ALSO FOR POLAD; TREASURY FOR M WAFER 
 
E.O. 12958: N/A 
TAGS: ETRD, PGOV, PREL, DR, CAFTA 
SUBJECT: DOMINICAN GOVERNMENT PUSHES HARD FOR CAFTA 
IMPLEMENTATION 
 
 
1. (U) Summary: Aiming for a January 1 implementation date 
for CAFTA, the Dominican Republic is working quickly to meet 
requirements.  The Fernandez administration recently created 
a task force made up of public and private sector trade 
experts, many of whom have CAFTA negotiating experience, to 
help ensure that the government stays on course with 
preparations.  USAID has hired contractors who are working 
with members of the task force and other Dominican Government 
officials to help prepare for implementation. End summary. 
 
2. (U) Along with some of its Central American CAFTA 
partners, the Dominican Republic has realized that it has a 
lot yet to do in preparation for implementation of the trade 
agreement.  Since a proposed implementation date of January 
1st was first put forward by USTR in the fall, the date has 
been the target the Dominicans have been aiming for.  As the 
deadline draws near, the government shows a new awareness of 
just how complicated are the preparations for the agreement. 
 
IMPLEMENTATION TASK FORCE 
 
3. (U)  President Fernndez has authorized an "implementation 
task force," a director and group of experts assigned to 
confirm that all agencies are doing what they should for 
implementation.  Fernndez appointed as interim director 
Guaracuyo Felix, head of the president's own budget office. 
Wilma Arbaje, a private consultant with extensive government 
experience, will take over the position when she returns this 
week from a trip abroad.   Meeting with USAID and Embassy,s 
economic officer November 17, Felix said that creation of the 
task force reflected the administration,s recognition that 
there was "need for additional focus" to ensure that 
implementation comes off without a hitch. He stressed that it 
is still the Ministry of Industry and Commerce and not the 
task force which holds ultimate responsibility for 
implementation. 
 
4.  (SBU) Felix offered for the task force to meet with 
Embassy officers weekly until implementation, so as to ensure 
that the Embassy and USG are  informed on status and aware of 
potential problems. He said the government plans to have all 
necessary pieces in place by mid-December, when the 
government shuts down for the holidays, to ensure January 1 
preparedness.  (Secretary of Industry and Commerce Javier 
Garcia was quoted in the press on December 1 as citing the 
mid-December deadline.)  Felix commented on widespread 
expectation among CAFTA participants that the implementation 
date could slip to March 1, which, he said, "would be more 
practical and less stressful to all participants, including 
the United States." 
DOMINICAN CUSTOMS 
 
5. (U) Customs Technical Subdirector Eduardo Rodriguez told 
us soon afterwards that his agency is also working with a 
January 1 implementation date, although he similarly 
indicated that Customs believes CAFTA countries might decide 
to delay implementation.   Rodriguez was confident that the 
Dominican Republic will be ready for January 1. He cited as 
progress the expected congressional approval of the fiscal 
reform package including regulatory changes necessary for 
implementation.  For instance, CAFTA-required elimination of 
a consular fee charged for all goods imported to the country 
is written into the fiscal reform package. 
 
USAID CONSULTANTS 
 
6. (U) USAID has hired two contractors with CAFTA negotiation 
experience in Central America to work on IPR and Agricultural 
issues.  IPR expert Federico Valerio is concerned that 
INFADOMI (an association of unscrupulous pharmaceutical 
copiers) continues to try to influence the patent office 
(ONAPI) into implementing procedures that favor patent 
violators and run counter to CAFTA.  So far, he said, ONAPI 
has resisted the pressure and the country is moving in the 
right direction on implementation.  Another indication of 
this, widely reported on November 30, was Senate President 
Andres Bautista's firm and vocal refusal to further consider 
INFADOMI-backed IPR-weakening legislation that the Embassy 
had earlier pointed to Bautista as problematic for CAFTA. 
 
7. (U) The USAID-hired agricultural policy expert, Vivian 
Santa Maria, brought up a potential concern regarding the 
Ministry of Agriculture,s approach to managing quotas, 
particularly the most sensitive: rice quotas.  The Ministry 
of Agriculture has drafted new quota regulations which 
compartmentalize quotas into three periods during the year, 
meaning that an importer must time imports according to a 
government-imposed schedule.  Other CAFTA participants allow 
flexibility to use quotas whenever desired throughout the 
year.  Santa Maria said that the Dominican approach is not 
unreasonable--it is based on historical marketing data--but 
added that it could potentially make importation more costly, 
forcing importers to bring in smaller quantities, more often 
than they would under a more traditional approach. 
KUBISKE