Arrests ahead of planned strike in Dominican Republic

Tuesday, November 11, 2003

SANTO DOMINGO, Dominican Republic: More than 100 activists and union leaders have been arrested in the Dominican Republic ahead of a strike called to protest against the government's economic policies, high prices and constant power cuts.

According to a Reuters report, an army spokesman in the once booming but now recession-struck country said on Monday that 106 people linked to Tuesday's planned protest were arrested and accused of carrying illegal weapons, or of planning "subversive actions."

One hundred and sixteen handguns and 12 shotguns were confiscated, he said, as well as 6,000 tires that police believe were intended to be set alight in barricades during the demonstrations.

The strike is set to take place in the same week that the government resumes talks with the International Monetary Fund over a stalled $600 million, two-year standby loan.

The multilateral lending agency agreed to support the Dominican Republic after the collapse of a major bank, Baninter, due to what authorities say was fraud, threw the economy of the tourism-dependent country into a tailspin.

The banking crisis was followed by a meltdown of the national electricity network as the cash-pressed government failed to come up with the funds to pay subsidies, and left energy distributors unable to pay generators.

Fifteen-hour power cuts have become the norm in a nation that was once a star economic performer and a haven of economic and political stability compared with neighboring Haiti, with which it shares the island of Hispaniola.

In another Reuters report, Moody's Investors Service on Monday cut its rating on the Dominican Republic's sovereign debt, saying a struggling economy is hampering the government's ability to manage its debts.

Moody's downgraded the Dominican Republic's bond rating to B2, five notches into speculative grade territory, from B1, with a negative outlook.

"A weak economy and tight external liquidity will continue to limit the authorities' ability to manage economic policy," the agency said in a statement.

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