NewsWhore
10-16-2007, 06:20 PM
Hacienda Minister Vicente Bengoa is working on ways for the government to apply the announced governmental incentives for job creation in the free trade manufacturing zones (FTZ). The incentives are based on the amount of jobs created. Bengoa has said that each company will receive RD$2,000 for each job created. Free zone employment has declined considerably in the past two years, with around 60,000 jobs lost due to competition from China and local cost factors. At the moment there are 132,000 jobs in free trade zones. Diario Libre reports that if each company were to meet the requirements set out in the action plan, government subsidies could reach RD$264 million a month. The program will run for a nine-month period, and total subsidies could reach RD$2.4 billion.
The current subsidy system is a quick fix for the problems that have plagued the FTZs. Over two years ago President Leonel Fernandez said that the current model for the FTZs was not sustainable and that there needed to be a dynamic change in the system's structure and model. Nevertheless, two years later there have been no significant changes in the model and jobs have continued to be cut.
Economist Pavel Isa said that free trade zones grew, not because of competitive forces, but because of protectionist policies implemented by the US. He added that as a result, when the sector was opened to competition as has happened in recent years, it hasn't done particularly well.
More... (http://www.dr1.com/index.html#4)
The current subsidy system is a quick fix for the problems that have plagued the FTZs. Over two years ago President Leonel Fernandez said that the current model for the FTZs was not sustainable and that there needed to be a dynamic change in the system's structure and model. Nevertheless, two years later there have been no significant changes in the model and jobs have continued to be cut.
Economist Pavel Isa said that free trade zones grew, not because of competitive forces, but because of protectionist policies implemented by the US. He added that as a result, when the sector was opened to competition as has happened in recent years, it hasn't done particularly well.
More... (http://www.dr1.com/index.html#4)