NewsWhore
06-28-2012, 05:10 PM
National Business Council president Manuel Diez Cabral used the American Chamber of Commerce luncheon as a forum yesterday, Wednesday 27 June to call for action to improve the Dominican Republic's competitiveness. His speech read like a blueprint for the actions the business sector would like President-elect Danilo Medina, who takes office on 16 August, to adopt in order to stimulate genuinely sustainable growth in the Dominican Republic.
He highlighted the fact that the rest of the world has been moving at a faster pace towards modernization than the Dominican Republic. Diez mentioned that the World Bank's 2012 Doing Business report shows the DR ranked 108th of 183 countries in business climate, with the DR being below the average for Latin America and the Caribbean that is 85. He made the point that in the region, we are only above Guyana, Suriname and Haiti. Moreover, in the 2012 World Economic Forum Global Competitiveness ranking, the DR fell 9 places from 2011, 15 places since 2010 and is now ranked 110th of 142 countries only above Belize, Venezuela, Paraguay, Haiti and Nicaragua.
He criticized that in recent years there has been a sustained trend towards an increase in the public deficit and debt. He said that in 2011, the fiscal debt stood at RD$56 billion, but for this year, the government plans a public deficit of RD$96 billion, or 4% of GDP, when originally 0.9% had been contemplated.
He criticized the way that it has become normal for the government to issue a supplementary budget that is funded by an increase in taxation at the mid-term point.
On the subject of employment, he expressed concern about the increasing number of informal jobs. He said that year 2000 Central Bank statistics showed that 47.2% of people worked in the formal sector, and 52.8% in the informal sector. But by 2011, informal jobs now represent 57.1% of employment. This occurred at the same time that the number of government jobs increased from 330,592 in 2000 to 653,595 in 2012.
Diez Cabral urged the government to listen to the business sector's call for a new business model. "The country has to leave behind the circumstances that have led to 90% of the national savings being used to purchase imported goods and services rather than using the resources for national investments."
He called for comprehensive tax reform that should be a priority for improving tax structure and eliminating excessive pressure, obstacles and distortions to production. The business leader said that tax reform and the labor regime must be redesigned to stimulate production, competitiveness and generation of wealth and new business, and a labor regime that stimulates new formal jobs and job stability. He said that the constant changes to tax laws have contributed to a climate of uncertainty for the economic sectors. He called for more vocational and technical training. "What good is it for our society to have 60,000 lawyers that the economy does not need, when we often have to import industrial technicians that the country is not training," he warned.
He backed the creation of effective institutional channels of communication between the public and private sector.
Diez called for the Central Bank to concentrate on its role as financial regulator and issuer.
He urged the government to take an active stance in the case of military officials who are in the business of cargo transportation saying that they are often the same people who are taking advantage of their rank promote and protect vandalism by unscrupulous groups. "If transport does not stop operating under extortionate conditions, we will not be able to reorganize the sector. Free competition in transport and free access to ports needs to become a reality."
"If we want to break the inertia, we must work hard to transform our culture of governance. Only if we build strong institutions to ensure compliance with the law and act with transparency will we have a real democracy and genuine rule of law. We must bury once and for all, the idea that prevails in our society that positions of power, public or private, are carte blanche to violate the law with impunity," he stressed.
www.amcham.org.do/pdf/Discurso_de_Manuel_Diez_ante_la_AMCHAMDR_27-6-2012).pdf (http://www.amcham.org.do/pdf/Discurso_de_Manuel_Diez_ante_la_AMCHAMDR_27-6-2012).pdf)
More... (http://www.dr1.com/index.html#8)
He highlighted the fact that the rest of the world has been moving at a faster pace towards modernization than the Dominican Republic. Diez mentioned that the World Bank's 2012 Doing Business report shows the DR ranked 108th of 183 countries in business climate, with the DR being below the average for Latin America and the Caribbean that is 85. He made the point that in the region, we are only above Guyana, Suriname and Haiti. Moreover, in the 2012 World Economic Forum Global Competitiveness ranking, the DR fell 9 places from 2011, 15 places since 2010 and is now ranked 110th of 142 countries only above Belize, Venezuela, Paraguay, Haiti and Nicaragua.
He criticized that in recent years there has been a sustained trend towards an increase in the public deficit and debt. He said that in 2011, the fiscal debt stood at RD$56 billion, but for this year, the government plans a public deficit of RD$96 billion, or 4% of GDP, when originally 0.9% had been contemplated.
He criticized the way that it has become normal for the government to issue a supplementary budget that is funded by an increase in taxation at the mid-term point.
On the subject of employment, he expressed concern about the increasing number of informal jobs. He said that year 2000 Central Bank statistics showed that 47.2% of people worked in the formal sector, and 52.8% in the informal sector. But by 2011, informal jobs now represent 57.1% of employment. This occurred at the same time that the number of government jobs increased from 330,592 in 2000 to 653,595 in 2012.
Diez Cabral urged the government to listen to the business sector's call for a new business model. "The country has to leave behind the circumstances that have led to 90% of the national savings being used to purchase imported goods and services rather than using the resources for national investments."
He called for comprehensive tax reform that should be a priority for improving tax structure and eliminating excessive pressure, obstacles and distortions to production. The business leader said that tax reform and the labor regime must be redesigned to stimulate production, competitiveness and generation of wealth and new business, and a labor regime that stimulates new formal jobs and job stability. He said that the constant changes to tax laws have contributed to a climate of uncertainty for the economic sectors. He called for more vocational and technical training. "What good is it for our society to have 60,000 lawyers that the economy does not need, when we often have to import industrial technicians that the country is not training," he warned.
He backed the creation of effective institutional channels of communication between the public and private sector.
Diez called for the Central Bank to concentrate on its role as financial regulator and issuer.
He urged the government to take an active stance in the case of military officials who are in the business of cargo transportation saying that they are often the same people who are taking advantage of their rank promote and protect vandalism by unscrupulous groups. "If transport does not stop operating under extortionate conditions, we will not be able to reorganize the sector. Free competition in transport and free access to ports needs to become a reality."
"If we want to break the inertia, we must work hard to transform our culture of governance. Only if we build strong institutions to ensure compliance with the law and act with transparency will we have a real democracy and genuine rule of law. We must bury once and for all, the idea that prevails in our society that positions of power, public or private, are carte blanche to violate the law with impunity," he stressed.
www.amcham.org.do/pdf/Discurso_de_Manuel_Diez_ante_la_AMCHAMDR_27-6-2012).pdf (http://www.amcham.org.do/pdf/Discurso_de_Manuel_Diez_ante_la_AMCHAMDR_27-6-2012).pdf)
More... (http://www.dr1.com/index.html#8)