PRESS CONFERENCE BY PRESIDENT OF DOMINICAN REPUBLIC

3 October 1996

Press Briefing

19961003 FOR INFORMATION OF UNITED NATIONS SECRETARIAT ONLY

President Leonel Fernandez Reyna, of the Dominican Republic told correspondents at a Headquarters press conference this morning that his country had begun a new phase in its foreign policy. His Government was pursuing a development policy aimed at improving the living standards of the Dominican people, and that would require the country to increase its participation in the world economy.

President Fernandez said that the Dominican Republic had traditionally been isolated from the other countries of the region because of differences in language and cultural heritage. He intended to strengthen ties with all countries of the Caribbean and Latin American region, and hoped to establish an embassy in Kingston, Jamaica, to strengthen links with the English-speaking countries of the area.

His Administration was already developing closer relations with Haiti, with which his country shares the island of Hispaniola, he added. A joint commission had met in Port-au-Prince to discuss such issues as the environment, micro-immigration, trade and cultural exchange.

Turning to domestic policy, he said that the Dominican Republic had been fighting to establish democracy and the rule of law since the end of the dictatorship of Rafael Trujillo 34 years ago. It had now moved from the stage of transition to democratic institutions, to one of strengthening those institutions. A Presidential Reform Commission was established to modernize the Government, and it was working to streamline its executive, legislative and judicial branches.

Regarding the economy, he said his country now enjoyed macroeconomic stability, single-digit inflation, and stable interest and exchange rates. It sought to develop as an export economy. For such reasons, the country was in an optimal position to play a more active role than it had in the past in the Caribbean and Central American region.

Would the fact that his party had a minority in Congress be an obstacle to his plans to reform the Government, privatize the public sector corporations, and improve living standards? a correspondent asked.

The President said that last week he had spoken in the Congress on a draft law to reform public enterprises. That law would make it possible to capitalize enterprises through private sector participation. The law was

flexible, and might also use options such as concessions, licensing arrangements, or total privatization through sale of shares.

It was important that the Congress support the legislation, he said. That would release resources currently used to subsidize state enterprises, most of which operated in deficit. Some were bankrupt. If the subsidies to enterprises -- which totalled some 4 billion Dominican pesos -- were reduced, that would free up funds to improve health care, education and other living conditions.

Asked whether the Congress would cooperate, he said that fortunately, the electoral platforms of the three main political parties -- his own party, the Dominican Liberation Party (PLD), the Social Christian Reform Party and the Revolutionary Dominican Party -- had contemplated privatization to resolve the problems of state corporations. If they stuck with those platforms, he did not foresee staunch opposition to the programme.

He went on to say that, under the draft law, there would be a break with the way the corporations were administered in the past. The law foresaw public administration of the corporations, which would make it possible to achieve a new style of administration, which was an important cause of corporations' financial problems.

What could be expected in the years to come regarding the country's economy and general well-being? a correspondent asked. The best way to describe the situation in the Dominican Republic, he said, was, in the words of Charles Dickens, "It was the best of times, and the worst of times." Like other societies, there was modernization as well as critical poverty. In the past 15 years there had been tangible progress. Further progress was possible in the areas of free trade, tourism and development of infrastructure to cover the entire country. The Dominican Republic, for instance, had one of the most advanced telecommunications systems in Latin America, he noted.

There was also a high unemployment level, an inadequate public health system and a school system that needed improvement, he said. Success in confronting those problems depended on the model of development that would be followed. The new Administration recognized that populism as a form of public administration had failed in the Dominican Republic. The macroeconomics of populism had no future in the country. That meant the Dominican State must give up its role as the manager at that level. It was inefficient. Resources would have to be transferred to vital social areas that made growth and development possible in the country.

Did he intend to increase his own salary and those of the Vice-President and other Ministers? a correspondent asked. He said the salaries for the President, Vice-President and other high government officials had been raised. Previously, the President had been earning the equivalent of $150 per month. Now it would be set at 90,000 Dominican pesos ($6,000) per month.

Dominican Press Conference - 3 - 3 October 1996

The problem was efficiency, he said. You could not have high officials managing million-dollar transactions at the same time that they were experiencing personal financial uncertainty. To combat corruption and increase efficiency, salaries needed to be commensurate with the dignity of the posts.

Asked what could reasonably be accomplished during his four-year term, the President said he represented a plan for development. It would be achieved over time. During the next four years it should be possible to achieve a revolution in ethics in the public sector, in which officials came to see themselves as public servants. He also felt that problems with the national electricity grid could also be solved, and that laws on energy and on public enterprise could be passed as well.

He also planned to activate the agricultural and industrial sectors of the country. The Government also had plans to make housing available for the poorest in the country and to make financing available for home-owners through loan guarantees and insurance. In addition, a commission was studying how the Government could help ensure that the 300,000 small enterprises in the country had access to financial loans.

Would the salary increases for high officials lead to general increases for public employees? a correspondent asked. Increases for public employees would occur, but would depend on first achieving higher levels of government revenues, he said.

Asked what was his policy for strengthening ties with Haiti, he said he had spoken about Haiti during his speech before the General Assembly today. He planned to strengthen his country's relationship with Haiti, and with the other Caribbean countries. He strongly identified with the democratic process occurring in Haiti, and had spoken with Haitian President Rene Preval. A Dominican delegation was in Haiti for negotiations, and he planned to visit Port-au-Prince when they were concluded. That would be the first time in this century that a Dominican President would visit Haiti.

During his visit to the United Nations, had he signed any agreements that would increase aid to the Dominican Republic? a correspondent asked. He said he had signed the Comprehensive Nuclear-Test-Ban Treaty (CTBT). The country already received aid from United Nations agencies, including the United Nations Development Programme (UNDP), which was cooperating with the government reform process; the International Research and Training Institute for the Advancement of Women (INSTRAW), which worked on issues affecting women; and the United Nations Children's Fund (UNICEF).

Asked whether high officials had resigned from the Government and whether there was discontent in the country, he said there really had not been enough time for discontent to occur. Politics would not be fun if there were no demonstrations. After all, that was what politics was about.

Dominican Press Conference - 4 - 3 October 1996

A correspondent asked about a report indicating that he planned to dissolve the Congress. President Fernandez said that he did not plan to dissolve the Congress, adding that the Congress could make important contributions to progress. In fact, he had appointed a Minister to coordinate between the Congress and the executive branch.

Asked about his relationship with former President Joaquin Balaguer, Mr. Fernandez said it was an excellent one.

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