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O 301403Z OCT 08
FM AMEMBASSY SANTO DOMINGO
TO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE IMMEDIATE
RUEHBO/AMEMBASSY BOGOTA IMMEDIATE 1707
RUEHWN/AMEMBASSY BRIDGETOWN IMMEDIATE 2199
RUEHCV/AMEMBASSY CARACAS IMMEDIATE 0945
RUEHGE/AMEMBASSY GEORGETOWN IMMEDIATE 1108
RUEHZP/AMEMBASSY PANAMA IMMEDIATE 0722
RUEHPO/AMEMBASSY PARAMARIBO IMMEDIATE 1233
RUEHPU/AMEMBASSY PORT AU PRINCE IMMEDIATE 4877
RUEHSP/AMEMBASSY PORT OF SPAIN IMMEDIATE 1937
INFO RUEHXQ/ALL EUROPEAN UNION POST COLLECTIVE

UNCLAS SECTION 01 OF 03 SANTO DOMINGO 001666 
 
SENSITIVE 
SIPDIS 
 
WHA/CAR FOR VDEPIRRO 
 
E.O. 12958: N/A 
TAGS: PGOV PREL KCRM EINV ECON DR
SUBJECT: SANTIAGO: THE OTHER DOMINICAN REPUBLIC 
 
REF: A. SDO 1513 
     ¶B. SDO 1608 
 
¶1. (SBU) Summary:  Whereas piles of trash and crumbling 
sidewalks decorate Santo Domingo, Santiago - the DR's second 
largest city - demonstrates what public-private partnerships 
and civic pride can achieve. The entrepreneurial spirit of 
the region was on display during Ambassador Fannin's recent 
trip both to Santiago and Puerto Plata, where he met local 
political and business leaders.  Santiago's mayor, a leader 
of the Reformista Party, has a knack for bringing various 
parts of the community together and is working to create 
consensus within his own fractious party as it seeks to 
select new leadership (Ref A).  However, the threat posed by 
narco-trafficking and related money-laundering is increasing 
in the region and prompted local prosecutors to appeal for 
more U.S.-sponsored training.  End Summary. 
 
Ambassador Fannin Reaches and Speaks Out 
---------------------------------------- 
 
¶2. (U) From October 7 to 9, Ambassador Fannin traveled to 
Santiago and Puerto Plata, in large part to speak before 
American Chamber of Commerce (AmCham) members and local 
dignitaries in both cities.  After reviewing the long and 
fruitful history of USAID and FCS efforts to promote SMEs and 
trade, the Ambassador stressed the need for the Dominican 
Republic to fight corruption. Given that tough economic times 
will cause investors to be choosier, he said, "Now more than 
ever this country needs to make clear that contracts are 
honored and the rule of law will be respected."  The 
Ambassador's speeches received widespread coverage in the 
media. 
 
¶3. (U) While in Santiago, Ambassador also spoke at the "Visit 
USA" event - a day of presentations about the U.S. visa 
process and entry requirements.  He next met with Dr. Sarah 
Gonzalez, Vice Rector of PUCMM (Pontificia Universidad 
Catolica Madre y Maestra), and the faculty of the university. 
 PUCMM was launched over 40 years ago with the support of 
USAID and is considered one of the country's best 
universities.  Embassy officials then held a town-hall style 
meeting with approximately 35 American students. A highlight 
of Ambassador Fannin's trip was his visit to the modern 
"HOMS" hospital in Santiago where he met 22 volunteer doctors 
and nurses from Arizona. The hospital was established through 
Santiago's biggest private-public partnership to date. The 
next day, he dropped by the "DREAM" project in Puerto Plata. 
The DREAM (Dominican Republic Education and Mentoring) 
project - with which USAID has a two-year collaborative 
agreement worth $290,000 - is a 501c3 non-profit that 
provides education to poor children from small communities in 
the DR. 
 
¶4. (U) Government and business leaders in the Northern parts 
of the Dominican Republic are determined to improve life in 
their region:  For instance, in addition to the HOMS 
hospital, Santiago boasts the "Centro Cultural Eduardo Leon 
Jimenes" - recently built by the very wealthy Leon family 
which has roots in Santiago.  This elegant, modern structure 
houses an art gallery, a "media-tech" center with searchable 
databases of maps, photos and other images, and a permanent 
exhibition of rare pre-Colombian Taino Indian artifacts. 
When Poloff visited the complex, several groups of students 
were on field-trips to the center.  Similarly, the DREAM 
project in Puerto Plata receives funding from local business 
leaders. 
 
The Special Case of Santiago 
---------------------------- 
 
¶5. (U) Following up on the Ambassador's successful trip, 
Poloff met with officials in Santiago on October 15 to fid 
out more about local conditions.  The first meeing was with 
Mayor Jose Enrique Sued, who is curently serving his third 
(and second consecutive)term.  Asked how Santiago looks so 
well maintaind, the Mayor apologized for the town's current 
sate, adding that a new trash collection contract wih an 
Italian firm will begin operating in Novembr.  He then 
explained that he works with "all leels of society" and that 
he and other leaders ar committed to implementing the 
 
SANTO DOMI 00001666  002 OF 003 
 
 
2006-2010 municipal plan.  Sued proudly stated that they are 
already working on a plan for the city and region that would 
run through 2020.  He noted that other parts of the Dominican 
Republic lack such development plans and suggested that other 
local governments do not work to build consensus across 
social and party lines, as does Santiago. 
 
¶6. (SBU) He complained, however, that the national government 
fails to provide his city with the money it should, given its 
population of 753,000.  (Note: In the DR, local governments 
do not have much power to tax and spend.  Santiago, the Mayor 
claimed, should be getting 10 percent of the national budget 
that is allocated to local government, but instead is 
receiving approximately 6.4 percent.   The Executive Director 
of the local Dominican-American Cultural Center, who has 
lived in the area some 30 years, confirmed that while 
previous mayors had complained about insufficient funding and 
"got nothing done," Sued is getting things done despite 
perennial budget issues. End Note)  The Mayor and the city's 
Secretary General, Victor Garcia, then recounted how it took 
15 years for the Santiago international airport to be built - 
another example, in their view, of deliberate efforts by "the 
politicians in Santo Domingo" to block local "autonomy" even 
at the cost of impeding national development. 
 
¶7. (SBU) Asked about the postponement of the Reformista 
Party's internal elections (originally scheduled for late 
October) and their transformation into a kind of leadership 
conference in late November, Sued confided that he was behind 
the move to change the process.  He said the PRSC (Partido 
Reformista Social Cristiano) needed a "new face."  If 
primaries - as opposed to a consensus-seeking mechanism - 
were to be used, he said, "We all know that the man with the 
most resources would win." (Comment: The Mayor and Poloff 
understood that he was referring to Amable Aristy.  Aristy, 
as noted in reftel A, is seen as likely to gain the PRSC's 
presidency because of his decades of service in the party and 
his reputedly vast wealth.  Given that Aristy led the party 
to disaster in the May 2008 presidential race, he would 
hardly represent a "new face."  Sued's comment is remarkable 
not only for the hint about role money plays in DR politics, 
but also because he served as Aristy's running mate in this 
year's election. 
End Comment.) 
 
¶8. (SBU) Sued also expressed reservations about aspects of 
President Fernandez's extensive package of constitutional 
reforms.  He said Dominicans must be "careful that any 
changes adopted do not lead to a further increase in 
presidential powers." (Ref B.) 
 
¶9. (U) The picture of regional initiative and coordination 
was corroborated by Santiago's Governor, Jose Izquierdo of 
the ruling PLD party.  Noting that Santiago is the largest 
and most influential city in the Northern half of the 
Dominican Republic, 
he affirmed that mayors from other towns in the Province of 
Santiago work together to push regional development. 
To emphasize the dynamic spirit of the region, he added that 
Santiago and nearby areas have produced many of the country's 
leaders throughout the nation's history.  (Note: The region's 
vibrancy has not always been appreciated, however.  While 
guiding the Ambassador through the historical parts of Puerto 
Plata, local businessman Vittorio Bedin said that when 
Trujillo was dictator of the Dominican Republic, he 
deliberately sought to reduce the town's role as a major port 
for political reasons. Now, Bedin and other local leaders are 
trying to save the town's remaining old Victorian style 
houses and the town clearly has potential for further tourism 
development. End Note) 
 
Narcotics and Money-Laundering - Growing Threats 
--------------------------------------------- --- 
 
¶10. (SBU) From a law enforcement perspective, however, the 
situation in Santiago is less rosy.  The regional Chief 
Prosecutor, or District Attorney, Raul Martinez and Assistant 
District Attorney Yeni Beremia began by noting the increase 
in narcotics trafficking in the area.  Both said their forces 
need training to deal with "micro-trafficking" (street level 
individual drug sales) and lamented the lack of contacts with 
 
SANTO DOMI 00001666  003 OF 003 
 
 
the Embassy's DEA office.   They said they understood that 
aerial and seaborne drug deliveries are primarily made to 
other regions of the country, but they pleaded for more help. 
 While saying they had good relations with the local 
judiciary, they not-surprisingly grumbled about the leniency 
of courts that "hand down six month sentences, instead of 
five years." 
 
¶11. (SBU) Ms. Beremia was particularly concerned about 
money-laundering which she said is everywhere and pointed to 
the construction boom as a suspicious sign.   To her, 
cooperation and training produce tangible results - she cited 
her experience being trained at ILEA in El Salvador three 
years ago as having made her much more effective.  Martinez 
and Beremia indicated that not only are drugs being sent 
abroad via the Santiago airport, they are also being 
distributed locally.  (Note: The later activity may explain 
their heightened concern - its not just foreigners receiving 
drugs nowadays.   While training courses have been offered in 
the past, Post will seek to build on these latest meetings 
and identify new modes of cooperation. End Note) 
 
Looking Ahead 
------------- 
 
¶12. (U) Comment:  Some of Post's long-term efforts - such as 
the creation of PUCMM - have bourn fruit in the fertile 
political and economic soil of the Cibao region, of which 
Santiago is the chief city.  It is heartening to see local 
business and political leaders vigorously promoting health, 
education and economic development in their area.  The 
presence of a European Union office in Santiago suggests 
others have also noted the potential for regional-level 
coordination of development efforts.  According to Mayor 
Sued, some other mayors have come to Santiago to see how it 
is done, but clearly progress is uneven throughout the DR. 
There is much potential in the North.  There is also the 
potential for that region's approach to be emulated in other 
areas.  Post will keep looking for opportunities to nurture 
such potential and develop partnerships to combat the spread 
of narco-trafficking. End Comment. 
FANNIN