VZCZCXYZ0000
PP RUEHWEB

DE RUEHDG #0145/01 0301603
ZNR UUUUU ZZH
P 301603Z JAN 08
FM AMEMBASSY SANTO DOMINGO
TO RUEHC/SECSTATE WASHDC PRIORITY 0045
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE PRIORITY
RUEHWN/AMEMBASSY BRIDGETOWN PRIORITY 2145
RUEHCV/AMEMBASSY CARACAS PRIORITY 0876
RUEHGE/AMEMBASSY GEORGETOWN PRIORITY 1059
RUEHKG/AMEMBASSY KINGSTON PRIORITY 2841
RUEHPO/AMEMBASSY PARAMARIBO PRIORITY 1186
RUEHPU/AMEMBASSY PORT AU PRINCE PRIORITY 4777
RUEHSP/AMEMBASSY PORT OF SPAIN PRIORITY 1887
RUEHUB/USINT HAVANA PRIORITY 0165
RUEAIIA/CIA WASHINGTON DC PRIORITY
RHEFDIA/DIA WASHDC PRIORITY
RUMISTA/CDR USSOUTHCOM MIAMI FL PRIORITY

UNCLAS SANTO DOMINGO 000145 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR WHA/CAR, INR 
 
E.O. 12958: N/A 
TAGS: PGOV ECON DR
SUBJECT: FERNANDEZ MAKES HIS CASE TO THE DOMINICAN PEOPLE 
 
REF: A. 07 SD 0233 (VARGAS WINS NOMINATION) 
 
     ¶B. 07 SD 0329 (VARGAS' POLITICAL DIRECTOR) 
     ¶C. 07 SD 0347 (PRESIDENTIAL PRIMARIES) 
     ¶D. 07 SD 0348 (VARGAS FOREIGN POLICY) 
     ¶E. 07 SD 0590 (FERNANDEZ TO RUN) 
     ¶F. 07 SD 0685 (FERNANDEZ DEFENDS RE-ELECTION) 
     ¶G. 07 SD 0846 (PLD DIVIDED) 
     ¶H. 07 SD 1017 (VARGAS WITH DIPLOMATIC CORPS) 
     ¶I. 07 SD 1078 (FERNANDEZ WINS PRIMARY) 
     ¶J. 07 SD 1501 (ARISTY WINS PRIMARY) 
     ¶K. 07 SD 1691 (CAMPAIGN TEAMS) 
     ¶L. 07 SD 1710 (ESTRELLA LEAVES PRSC) 
     ¶M. 07 SD 2143 (CENTRAL ELECTIONS BOARD) 
     ¶N. 07 SD 2366 (ANALYTICAL OVERVIEW) 
     ¶O. 07 SD 2568 (VARGAS WITH POLOFFS) 
     ¶P. SD 0039 (RHETORIC HEATS UP) 
     ¶Q. SD 0090 (VIEW FROM SANTIAGO) 
     ¶R. SD 0124 (VARGAS WITH AMBASSADOR) 
 
Summary 
------- 
 
¶1. (SBU) On January 29, President Fernandez gave a major 
campaign speech in which he took credit for reestablishing 
macroeconomic stability, warned against returning the rival 
PRD party to power during challenging economic times, and 
promised a series of programs for his next term.  While 
engaging in some negative themes, most of Fernandez's speech 
was focused on specific policy issues.  This was a welcome 
change to a campaign marked by personal attacks, even if we 
doubt the government's ability to fund all of its promised 
programs. 
 
Mission Accomplished 
-------------------- 
 
¶2. (U) The official occasion for Fernandez's speech was his 
acceptance of the PLD party's nomination for the presidency; 
however, since he won the primary nine months ago, the event 
served as a de facto campaign launch.  After warm-up speakers 
and merengue bands had fired up the faithful bedecked in the 
PLD's trademark purple, Fernandez took the stage and reminded 
the audience of the situation he inherited upon taking office 
in 2004.  He described the 2003-04 economic crisis as one of 
the "most acute and traumatic" in the country's history.  He 
said that administration had sought to immediately 
reestablish stability, growth, and investor confidence, and 
that, "Almost four years later we can say with pride to the 
Dominican people: Mission accomplished." 
 
¶3. (U) Fernandez then sought to contrast his achievements 
with the record of his opponent, former Minister of Public 
Works Miguel Vargas Maldonado.  The President listed a number 
of nearly completed infrastructure projects that were turned 
over to Vargas' ministry when the PLD left office in 2000, 
and said, "Do you know what (Vargas did with the projects)? 
He did nothing."  Now the PRD is back, Fernandez said, but 
all they have to offer is "insults." 
 
¶4. (U) Fernandez advised against the complacency that could 
result from the strong growth in recent years, saying that 
"new storms are on the horizon, this time caused by changes 
in the international arena."  He listed as specific threats 
the high price of oil, housing loan defaults in the U.S., 
poor performance of the Dollar against the Euro, and an 
"imminent recession in the U.S. economy."  Warning of a vote 
for the opposition on May 16, the President said that in 
times like these, "the people have never replaced sober and 
restrained leaders....  What the Dominican Republic needs (at 
this time) is to consolidate its accomplishments." 
 
Promises, Promises 
------------------ 
 
¶5. (U) For the first time in the presidential campaign, 
Fernandez outlined his plans in detail should he be 
reelected, including the following economic proposals: 
-- Implementation of a National Competitiveness Plan; 
-- Eliminating electrical blackouts by 2012 through the use 
of alternative energy and sectoral reforms; 
-- Creation of a national system of innovation and 
technological development; 
-- Development of textile and footware clusters; 
-- Increased funding for small- and medium-sized enterprises; 
-- Promotion of agrobusiness; 
-- Diversifying the tourism sector and improving the quality 
of its products; 
-- Construction of 200,000 new homes; and 
-- Carrying out a long list of infrastructure projects, 
principally highways and bridges (note: the costly Santo 
Domingo subway project was only mentioned briefly). 
 
¶6. (U) Addressing the issue of poverty, Fernandez argued 
that, to aid the poor, "it is not sufficient to have 
stability and economic growth."  Putting special emphasis on 
education, the President said that, "It is a fundamental 
objective of the next PLD government to make Dominican 
education free and obligatory through grade 12.  This has 
never been achieved in the history of our country." 
Fernandez also announced plans for improved technical 
institutes, additional funding for school meals, and 
scholarships for international undergraduate study (10,000) 
and PhD programs (2,000).  In addition to improving 
education, the President pledged to fight poverty by: 
 
-- Doubling of recipients of the "Solidarity" food aid 
program from 300,000 to 600,000 households and increasing the 
monthly payment by 27 percent; 
-- Establishing a financial assistance program for mothers 
aged 13-18 who agree to stay in school; and 
-- Increasing funding to the so-called "People's Pharmacies." 
 
¶7. (U) As for the opposition, Fernandez said "they don't 
discuss any of this....  The reason is clear -- they don't 
have a vision of the future.  They don't have a national plan 
and only think about winning power and satisfying their 
personal aspirations. 
 
Vargas Responds 
--------------- 
 
¶8. (U) The immediate response of Vargas' communications 
director, Carlos Gabriel Garcia, was that Fernandez was 
simply reading a long list of promises that he has no 
intention of fulfilling.  Garcia charged that in the national 
budget approved only weeks ago, social spending was actually 
reduced, and said that "what the people want are initiatives 
such as the increasing of government salaries and 
pensions....  The requests of youth and women haven't been 
heard by Leonel Fernandez, nor has (he responded to) the 
anguish of Dominican families (affected) by the uncontrolled 
increase in crime." 
 
¶9. (SBU) Vargas defended his professional accomplishments, 
contrasting Fernandez's career as a professor, lawyer, and 
public servant with Vargas' 34 years as a businessman engaged 
in "productive activity generating and creating jobs."  As 
for the PLD, Vargas continued, the voters should ignore 
promises and hold the ruling party to account for their 
record in office:  "What he is asking for is four more years 
to continue violating the constitution, four more years to 
invest less in education, four more years to carry out 
projects like Sun Land."  (Note: The Sun Land case concerns 
the PRD charge that Fernandez violated the constitution in 
seeking a US$130 million loan for public works.  The 
financial transaction was handled by The Sun Land 
Corporation, a U.S.-based intermediary whose structure and 
membership is opaque, but is rumored to be associated with 
the President.  The PRD alleges that the loan did not have 
the required approval of Congress and that it is unclear 
where the borrowed funds were allocated.  The IMF has also 
expressed concerns regarding the loan, which violated IMF 
regulations under the Stand-By-Arrangement.) 
 
PLD Unity 
--------- 
 
¶10. (SBU) Prior to the January 29 campaign event, there had 
been much speculation over whether Danilo Medina would 
attend.  A powerful PLD leader and Fernandez's former chief 
of staff, Medina had challenged the incumbent President in 
the party primary and complained bitterly when defeated that, 
"The state imposed itself."  Medina did not attend; however, 
while his personal relationship with Fernandez remains in 
doubt, the negative impact on the party has been reduced 
significantly by his instruction to his followers to actively 
support the Fernandez campaign. 
 
Comment 
------- 
 
¶11. (SBU) Prior to this speech, Fernandez's campaign had been 
primarily negative and focused on blaming the PRD for the 
2003-04 economic crisis.  We welcome the introduction of 
specific policy proposals, even as we note that Fernandez's 
discussion of social programs was far more focused on making 
promises for the future than discussing past achievements. 
The considerable time the President devoted to education is 
noteworthy.  The country has a poor record of achievement in 
that sector, and the very low amount of government resources 
dedicated to education is a significant barrier to potential 
Millennium Challenge funding.  Whether Fernandez, if 
reelected, can achieve his lofty goals is an open question 
given his government's limited budgetary resources. 
 
(U) This report and additional information can be found on 
Embassy Santo Domingo's SIPRNET site, 
http://www.state.sgov.gov/p/wha/santodomingo/  
FANNIN