This record is a partial extract of the original cable. The full text of the original cable is not available.

S E C R E T SECTION 01 OF 03 SANTO DOMINGO 000709

SIPDIS

STATE FOR WHA, WHA/CAR, WHA/EPSC, INL; NSC FOR SHANNON AND

MADISON; TREASURY FOR OASIA-LAMONICA; USTR FOR MALITO 

E.O. 12958: DECL: 02/09/2015

TAGS: EFIN KIPR ETRD DR

SUBJECT: DOMINICAN PRESIDENT ON BROADCAST PIRACY, LAW

ENFORCEMENT REFORM, EXTRADITION AND ECONOMIC PROGRAM

Classified By: DCM LKUBISKE. Reason 1.4 (b) and (d).

¶1. (C)  Summary.  Dominican President Leonel Fernandez
discussed the Dominican economy, CAFTA, broadcast piracy,
Haiti and police and intelligence reform during a February 2
meeting with the Ambassador.  Fernandez believes the new IMF
Standby Agreement is as important for creating confidence as
it is for bringing stability to the country.  He said that
his government is committed to educating the public on CAFTA,
an agreement still misunderstood by much of the country.  He
promised to look into the continuing problem of television
broadcast piracy.  Fernandez gave details regarding planned
changes in the National Directorate of Intelligence and said
that he would accept Embassy information to assist in
cleaning up the corrupt police force. He said that he would
speak with the Dominican Ambassador to Haiti regarding his
behavior, and acknowledged the importance of a sensitive
extradition case now underway.  End summary.

¶2. (SBU) In a February 2 meeting, the Ambassador
congratulated President Fernandez on completion of the IMF
Standby Agreement, announced January 31.   Fernandez noted
that the agreement is as important for creating confidence as
it is for bringing economic stability.   He believes it vital
for Dominicans to understand that the Standby agreement is
not creating new austerity, but that his government began
taking the current cost-cutting measures immediately after
taking office last August.   "I think that the worst of the
crisis has passed," he said. 

¶3. (C) The Ambassador noted that the quasi-fiscal deficit is
a serious and persistent problem.  Fernandez said that yes,
the deficit is real, but argued that the peso,s appreciation
has made it a smaller problem than it was before.  He
reported that a committee had been formed with
representatives from the Attorney General,s Office, Central
Bank, and the Banking Superintendent to decide how to
liquidate Baninter debt.  Fernndez added that the proceeds
from collections will be used to reduce the deficit, and
pointed out that this year government deficit spending is .7%
and that the 2006 target is to eliminate the deficit
completely.  Any surplus in 2006 would be applied to reduce
the quasi-fiscal deficit. 

CAFTA and IPR

¶4. (C) The Ambassador mentioned the recent meeting of foreign
ministers in Central America regarding CAFTA and their
universal support for ratification.  Fernandez asked when the
United States expected to ratify.  The Ambassador responded
that ratification is moving forward in the United States
already and that the Dominican Republic should proceed as
soon as possible.  Fernandez noted that Chile has done
exceptionally well and benefitted under its bilateral free
trade agreement with the United States.  He was conversant
with Chile's export figures and saw the country,s free trade
relations with the United States under NAFTA as responsible
for the country,s strong economic performance, adding that
the Dominican Republic,s proximity to the United States
should allow for even greater benefits here.  Fernandez said
that he wants to organize a daylong program at his Global
Foundation for Democracy and Development (www.funglode.org)
to help explain and discuss CAFTA.   He thinks that there is
still much misunderstanding about the agreement and that a
discussion by Dominican senators, business leaders and
economists would lead to greater public understanding of the
benefits of CAFTA.  He hopes that one or two people from USTR
could speak at this event.

¶5. (C) The Ambassador incicated the U.S. Government,s desire
to see an end to television broadcast piracy and noted that
U.S. Representative Katherine Harris has expressed her
concern about the broadcast piracy problem in the Dominican
Republic and will soon be sending Fernandez a letter
documenting her interest.  The Ambassador said that
television broadcast piracy remains a serious problem here
and that despite a court case late last year against the
major Dominican station Telemicro, independent state action
to stop the problem is urgently needed.  He reminded
Fernandez of his desire to develop the film industry here and
to organize a film festival in the future to promote the
industry, noting that these plans will not advance if piracy
continues.  The Ambassador told Fernandez that the Motion
Picture Association of America (MPAA)  has asked for a review
of the Dominican Republic,s GSP status based on the
continuing problem.  Fernandez asked if CAFTA would not make
GSP redundant.  The DCM noted that broadcast piracy will
continue to be a problem in any number of contexts, including
CAFTA ratification, if not cleaned up. 

¶6. (C) Fernandez said that he knew that Telemicro had
broadcast &new8 (pirated) movies in the past, but thought
that the problem had been resolved.  He said that he would
check into the issue, adding in English,  "I've got the
message."   Continuing with the theme of IPR enforcement
related to movies, Fernandez mentioned that he had argued
with the head of the National Copyright Office (ONDA)
recently for having conducted a raid on a prominent local
video store.  He noted that the video rental business has no
interest in pirated products and that these &legitimate8
stores are against piracy.  (Note:  We have heard several
versions of the raid story; and one includes the use of
presidential police to call off ONDA during the raid.  The
issue of video stores is murky, involving legitimately
purchased products created for the U.S. market being sold
here, circumventing the regional code protocols set up by
major studios.  End note.)

Paulino--Drugs

¶7. (C ) Speaking of the recent arrest of retired Captain
Quirino Paulino Castillo for narcotrafficking, Fernandez said
that the case had taken the country by surprise.  Fernandez
commented that it is often impossible to know what a person
is truly like.   During his campaign the president personally
heard very positive comments about Paulino.  He noted that he
hopes for Paulino,s prompt extradition without mishaps.   He
promised to try to ensure adequate security for Paulino while
his extradition request is pending a Supreme Court decision. 

Concerns about Dominican Intelligence Chief

¶8. (S) The Embassy raised problems with the National
Intelligence Directorate (DNI) under the leadership of
Retired General Manuel de Jesus Florentino y Florentino, and
led a frank discussion concerning questions about
Florentino,s competence and personal integrity, as well as
information linking Florentino to Paulino.  The President
noted that during his first term Florentino had served as his
Secretary of the Armed Forces and had headed the presidential
security guard as well.  Fernandez had seen him as a serious,
and &correct8 officer and said that he had not known of any
association by Florentino with narcotrafficking.  The
president seemed to acknowledge Embassy arguments, however
and agreed to remove Florentino &soon8 at a less
politically volatile moment, and sought Embassy input on his
replacement.


Crime and Corruption

¶9. (C ) Commenting on the military, Fernandez said that it is
understood that high-ranking military staff members routinely
take 10% of resources that passes through their hands as a
"commission," adding "the military is a corrupt
institution."  He said that if he moved too fast in firing
corrupt officers, his own position would be in jeopardy. He
noted that Mejia was fond of the military and kept his guards
dressed in uniform while Fernandez prefers civilian clothing
for his guards. Fernandez considered it a significant
achievement to have forced retirement of 100 generals since
taking office.  He commented that this still leaves 100 more
who should be relieved.  On the other hand, he said, "if one
thing works in the Dominican Republic, it,s the military,"
-- indicating that the military is disciplined, and
hierarchical, and proud of position.

¶10. (C)  Fernandez said one of his government,s priorities
is dealing with crime and an important element is cleaning up
the police force.  Immediately after his inauguration, he
noted, Dominicans just wanted him to strengthen the peso, but
now all they want is a lower crime rate.   Fernandez asked
for Embassy ideas on combating police corruption and said
that he was receiving advice from the New York City Police
Department, the NYPD, New Jersey State Police, and John Jay
College of Criminal Justice of the City University of New
York, and had invited the Bogota (Colombia) police chief to
help improve training of the Dominican police force.  Embassy
NAS Officer noted that training and equipping the police
force is vital, but narcotics-related corruption at the
highest levels of the police force must also be addressed.
Fernandez said that he would fire corrupt police officers
when provided with evidence and asked for Embassy,s help in
obtaining this.  The Ambassador offered to provide additional
details regarding known corrupt officials. 

Haiti

¶11. (S) As a followup to previous discussions between the
Ambassador and President Fernandez regarding Haiti, the
Ambassador referred to rumors that Dominican Ambassador to
Haiti Jose Serulle Ramia was not being entirely faithful to
Dominican policy guidelines.  Fernandez replied that he had
chosen Serulle for this position because he belongs to a
respected family and is serious, educated, honest, and
trusted, and fluent in French and Creole and thus a fitting
representative for the Dominican Republic.  However,
Fernandez conceded, Serulle, like others in his family, is a
&little crazy8 and very emotional, and commented only half
in jest that he would not be surprised if Serulle considered
himself a viable candidate for the presidency of Haiti.
Fernandez stated categorically that he understands that
Serulle is meeting in a "leadership role" with all sectors of
Haitian society, including the opposition, -- which,
according to Fernandez, "is not his job."  Fernandez promised
to rein in Serulle.  He emphasized that the Dominican
Government recognizes the Haitian Interim Government (IGOH).
He said that he believes his government has a responsibility
to help Haiti, since Haiti,s situation affects both sides of
the border.   (Note:  Foreign Minister Carlos Morales
Troncoso, in comments to the Ambassador on February 7, called
Serulle &useless8 and &crazy8 and said he would be
removed within the next two weeks.  Septel reports details of
that meeting.  End note.)
HERTELL