Corruption "rampant" in Dominican Republic - leaked cable

A 2008 cable from U.S. Ambassador to Santo Domingo Robert Fannin cited U.S. investors' testimony that then Tourism Minister Felix Jimenez attempted in 2007 to solicit a $10 million (6.46 million pound) bribe from American company Forbes Energy to enable it to build an ethanol plant in the north of the country.

In a separate 2009 cable, the embassy cited global investment firm Advent International as saying it became so disillusioned with harassment from airport department director Andres Van Der Horst, who also sought a bribe, that it would not proceed with further investments in Dominican Republic.

Both cables criticized the business climate in the Caribbean nation ruled by President Leonel Fernandez, which ranks 101 out of 178 countries listed in Transparency International's 2010 corruption perceptions index.

"If Dominican government officials wish to attract and retain foreign investors, they cannot require these investors to participate in the rampant corruption of ... Dominican-style business," the classified embassy cable said.

"It is the local business climate that needs to reform, not the foreign investors," it said.

Jimenez and Van Der Horst denied the allegations and threatened Monday to sue Fannin and Spain's El Pais newspaper which first reported on the leaked cables Friday.

The publication of the diplomatic messages is the latest example of the ability of WikiLeaks, founded by Australian Julian Assange, to cause international embarrassment.

In line with its general policy on the WikiLeaks disclosures, the State Department told the Dominican Republic government the cables do not represent definitive U.S. policy.

U.S. Assistant Secretary of State for Western Hemisphere Affairs, Arturo Valenzuela, phoned Dominican Foreign Minister Morales Troncoso Saturday to apologise for the leaks, said Rafael Nunez, a spokesman for Fernandez.

But the cables merely confirm perceptions on corruption in the country, said Heather Berkman, analyst of Central America and the Caribbean for the Eurasia Group consulting firm.

"I don't think this (the publication) will have a far reaching impact because it just confirms what everybody knows. But this type of corruption has already hurt the country's investment," Berkman said in an interview Tuesday.

(Additional reporting by Matthew Bigg in Atlanta, editing by Pascal Fletcher and Anthony Boadle)