/raid1/www/Hosts/bankrupt/TCRLA_Public/020313.mbx        T R O U B L E D   C O M P A N Y   R E P O R T E R

                   L A T I N   A M E R I C A

            Wednesday, March 13, 2002, Vol. 3, Issue 51

                           Headlines


A N T I G U A   &   B A R B U D A

LIAT: Critical US$11 Mln Loan Approved


A R G E N T I N A

ARGENTINE INSURERS: S&P Reports on Challenges Facing Industry
BANCO GALICIA: Foreign Creditors To Participate In Rescue Plan
IMPSAT FIBER: Creditors Agree to Debt Reduction Plan
INVAP: Financial Woes Put Australian Project At Risk
PECOM ENERGIA: Posts $146M Loss for 4Q Ended Dec. 31, 2001
TGN/BHN: S&P Explains Transactions' Technical Default


B E R M U D A

GLOBAL CROSSING: CEO Intends To Slash Costs To Avert Liquidation
GLOBAL CROSSING: Some 40 Companies Express Bidding Interest


B R A Z I L

GLOBO CABO: Rights Offering Next Step to Raise Funds
INDUSTRIAS KLABIN: May Reduce Debt With Asset Sales
VASP: Nears Debt Agreement With Banespa


C H I L E

EDELNOR: Reveals Plan To Cut Financing Payments


M E X I C O

CINTRA: ASPA Wants To Delay Sale
GRUPO MEXICO: Workers Remain On Strike Over Wages
HYLSAMEX: Pays Half of Interest Payment on Mexican Bond
PEGASO: QUALCOMM Signs Letter of Intent with Telefonica Moviles
PEGASO: Owes Qualcomm US$674 Mln


T R I N I D A D   &   T O B A G O

BWIA: Workers Begin Applying For Voluntary Severance Program


     - - - - - - - - - -


=================================
A N T I G U A   &   B A R B U D A
=================================

LIAT: Critical US$11 Mln Loan Approved
--------------------------------------
The regional airline LIAT got a shot in the arm after it received
an EC$31-million (US$11 million) loan to replace aging planes,
finance its voluntary severance program and boost marketing
initiatives.

LIAT chief executive officer, Gary Cullen, revealed in a report
released by The Jamaican Observer that the governments of Antigua
and Barbuda, St Lucia, Barbados and St. Vincent and the
Grenadines plus two private Antiguan companies acted as
guarantors for the money sourced from CIBC West Indies Holdings
in Barbados.

"LIAT had been short of cash for the last couple of years and
obviously the market has a lot more competitors than before. So
it was very important that we receive the necessary investment so
we can do the things that are necessary to ensure the future
success of the Company," said Cullen.

LIAT had offered a voluntarily redundancy package to employees,
as one way of reducing overhead expenses. Cullen is hoping that
with the fresh injection of capital another 100 employees
throughout the Caribbean will take up the offer. Around 250
employees have so far opted for voluntary redundancy.

"We are about two-thirds of the way to meeting the target we set
out in the year 2000. We hope that at least 100 workers will
accept the offer," Cullen said.

Meanwhile, Cullen has expressed concern on speculations that two
of the five LIAT-controlled Antigua-St. Maarten routes would be
given to Caribbean Star. According to Cullen, the move would be
"seriously detrimental " to the airline. However, he is
optimistic that this will not happen.

"If they get permission to fly, that's one thing, so be it, but
certainly it is very different thing if LIAT has to give up any
route for Caribbean Star or any other airline. That is actually
taking away our business -- it would be different than just
offering competition."

"We can cope with competition and we have been coping very well
with competition for the last two years even though we were
restricted in terms our marketing stance in terms of putting
additional capacity on," LIAT's CEO said.



=================
A R G E N T I N A
=================

ARGENTINE INSURERS: S&P Reports on Challenges Facing Industry
-------------------------------------------------------------
The gravity of Argentina's economic and political crisis curbed
the hopes of finding a timely solution to its insurance
industry's chronic struggle toward efficiency and stability, says
a new Standard & Poor's report.

"After a decade of struggle to amend past errors, the Argentine
insurance sector had managed to improve its solvency and
transparency, turning itself into a more consolidated market on
the verge of showing a profit for the first time in years," said
Carina Lopez Espino, an associate director with Standard & Poor's
financial services ratings group in Buenos Aires.

The report, "Argentine Insurers: Back to the Bad Old Times,"
added however that besides the prolonged recession that hurt the
levels of underwritten premiums and collections, during the past
year insurers suffered rapid credit quality deterioration of
their investment portfolios, additional pressure on liquidity as
a result of the distressed debt exchange and the banking crisis,
and, more recently, a complete change in the operational
insurance framework derived from the devaluation of the currency
and the "pesification" (the conversion of dollar assets and
liabilities to pesos) of the Argentine economy.

Dozens of insurers dedicated to asset-accumulation businesses
could disappear, since savings-related products lost all appeal
after local policyholders suffered enormous losses due to the
pesification of their funds. In this context, savings products
provided by offshore companies, though prohibited, could become
popular once again, as was the case in the 80s and early 90s.

Further, whether foreign shareholders will ever decide to
recapitalize companies whose current business profiles are
uncertain, at best, remains unclear.

In any case, some of the probable scenarios start to resemble the
business model entrenched in the 80s insurance industry: a
monopoly local reinsurer to replace the lack of international
credibility, indexation clauses to protect balance sheets from
escalating inflation, and increased "negotiation" of claims'
amounts and dates of payment to match available liquid resources.

CONTACT:  Standard & Poor's (Buenos Aires)
          Carina Lopez, +54-11-4891-2118


BANCO GALICIA: Foreign Creditors To Participate In Rescue Plan
--------------------------------------------------------------
A group of foreign lenders has signed letters of intent to
convert as much as US$400 million of loans to Banco de Galicia y
Buenos Aires SA into equity shares to help rescue the ailing
bank, said Jose Jaime, who heads Seguro de Depositos SA,
Argentina's deposit insurance fund.

According to Jaime, the group comprises J.P. Morgan Chase & Co.,
Barclays Plc, Dresdner Bank AG and the World Bank's International
Finance Corp.

Jaime also named Bank of America Corp. as part of the
group, but Bank of America spokeswoman Tara Burke denied such
information saying that the bank hadn't agreed to participate in
an equity-for-debt swap.

"We have made no such offer," Burke said. "Our suggestion was to
set up a steering committee with the lenders, the borrower and
the regulators to help decide the best approach."

Seguro de Depositos, which pools contributions from banks in
Argentina, will lend ARS200 million, while ARS100 million will
come from a government bank capitalization fund and ARS100
million from new, long-term central bank loans, Jaime said.

Banco Galicia also will sell ARS400 million of its best
performing loans to other domestic banks, Jaime added.

Banco Galicia ran short of cash after depositors accelerated
withdrawals last year as a recession deepened and concern grew
that the government would devalue the peso or seize deposits. The
bank has borrowed ARS3.41 billion (US$1.5 billion) from the
central bank to stay afloat, Jaime said.

The bailout plan approved by the central bank involves Banco
Galicia receiving a total ARS800 million of cash, in addition to
the international debt-for-equity swap.

Spanish banks in Argentina, including Banco Santander Central
Hispano SA and Banco Bilbao Vizcaya Argentaria SA, may also
convert loans for shares, Jaime said.


IMPSAT FIBER: Creditors Agree to Debt Reduction Plan
----------------------------------------------------
In an official company press release, Impsat Fiber Networks, Inc.
(NASDAQ: IMPT) ("Impsat" or "the Company") announced that it has
reached non-binding agreements in principle with several of its
largest vendors and bondholders in support of a restructuring
plan that would reduce Impsat's total consolidated indebtedness
by approximately $680 million and its future debt service
requirements.

Impsat reached an agreement in principle regarding a de-
leveraging restructuring plan with several principal holders of
the Company's Senior Notes and with its largest vendor financier.
The proposed plan for financial restructuring will significantly
improve the Company's balance sheet structure and should enable
Impsat to fully realize the growth potential of its operations in
Latin America. The restructuring plan involves the Company's
Senior Notes due 2003, 2005 and 2008 (the "Senior Notes"), its
Broadband Network Vendor Financing Agreements and certain other
credit lines of the Company.

The key components of the proposed restructuring plan are
expected to include:

-   Holders of debt under the Company's Broadband Network Vendor
Financing Agreements would receive a combination of senior
secured indebtedness totaling $141 million, $23 million of new
Senior Guaranteed Notes initially convertible into 5% of the
Company's new common stock and warrants to acquire 15% of the
Company's new common stock.

-   Holders of the Company's Senior Guaranteed Notes due 2003
would receive new Senior Guaranteed Notes in an amount of $67
million, initially convertible into 23% of the Company's new
common stock.

-   Holders of the Company's Senior Notes due 2005 and 2008 would
exchange those Notes for 98% of the Company's new common stock.

-   The Restructuring Plan contemplates no distribution to
existing stockholders of the Company.

Ricardo Verdaguer, Chief Executive Officer of Impsat, said: "We
are gratified to have obtained this level of support from our
creditors. Our operations continue to develop successfully in the
region despite the overall economic downturn, and this agreement
shows the confidence financial investors have in our story. This
restructuring will significantly strengthen Impsat and allow it
to sustain its leadership in the region.

We are confident that the terms of the agreement we reached are
representative of the interests of the different classes and will
result in an acceptable package to the remaining creditors.
Following this agreement, we believe we can successfully complete
our financial restructuring to give the Company a fresh start and
a healthier balance sheet."

Completion of the restructuring plan will be subject to certain
conditions, including the achievement of additional creditor
support in favor of the Restructuring Plan and the execution and
effectiveness of binding definitive documentation for the
Restructuring Plan. The Company believes that it will be able to
complete successfully its negotiations with the remainder of its
affected creditors regarding the Restructuring Plan during the
coming weeks. The Company anticipates that it may effectuate the
restructuring through a pre-arranged plan of reorganization under
Chapter 11 in the first half of 2002.

Impsat Fiber Networks, Inc. is a leading provider of fully
integrated broadband data, Internet and voice telecommunications
services in Latin America. Impsat has recently launched an
extensive pan-Latin American high capacity broadband network in
Brazil, Argentina, Chile and Colombia using advanced
technologies, including IP/ATM switching, DWDM, and non-zero
dispersion fiber optics. The Company has also deployed fourteen
facilities to provide hosting services. Impsat currently provides
services to 3,000 national and multinational companies,
government entities and wholesale services to carriers, ISPs and
other service providers throughout the region. The Company has
local operations in Argentina, Colombia, Venezuela, Ecuador,
Mexico, Brazil, the United States, Chile and Peru. Visit us at
www.impsat.com.

CONTACT:  Impsat Fiber Networks, Inc.
          Guillermo Jofre/Gonzalo Alende Serra, 54 11 5170 3700
          or
          Houlihan Lokey Howard & Zukin Capital
          John McKenna/Lily Chu, 212/497-4100
          or
          Citigate Dewe Rogerson
          John McInerney/Robin Weinberg, 212/688-6840


INVAP: Financial Woes Put Australian Project At Risk
----------------------------------------------------
The project to build Australia's second nuclear reactor at Lucas
Heights, in Sydney's south, may not materialize. In a report
released by AAP News, environmental watchdog Greenpeace said that
the Argentinean construction company Invap, which won the
contract to build the project, appears to be financially-
strained.

Invap contracted with the Australian Nuclear Science and
Technology Organisation (ANSTO) in July 2000 to build Australia's
replacement nuclear reactor. The project was supposed to begin
February, however, nuclear regulator ARPANSA hasn't signed off on
the plan yet.

There are now apprehensions that Invap will be able to deliver on
the contract after seeking a US$10-million bailout loan from the
financially-crippled Argentinean government.

While the money was approved in an emergency budget delivered
this week to secure a financial rescue package from the
International Monetary Fund, Greenpeace said the Argentine
government would not be able to deliver.

Greenpeace believes that the measure had been approved simply to
deceive Australia into believing Invap had the capacity and cash
flow to proceed with the project.

However, according to an ANSTO spokesman, while his organization
was unaware of Invap's problems, it was carefully monitoring the
Company to ensure the reactor project proceeded.

"Invap were financially viable when we went into the contract and
there's nothing that we have seen since, with our active and
ongoing monitoring of them, to say that they're unviable," he
said.


PECOM ENERGIA: Posts $146M Loss for 4Q Ended Dec. 31, 2001
----------------------------------------------------------
Perez Companc S.A. (Buenos Aires: PC NYSE: PC), controlling
shareholder with a 98.21% stake in Pecom EnergĦa S.A. (Buenos
Aires: PECO), announces both companies' results for the fourth
quarter ended December 31, 2001.

Perez Companc S.A. (whose only asset is its equity interest in
Pecom EnergĦa S.A.) posted a $146 million loss in the fourth
quarter of 2001 ($0.068 per share and $0.68 per ADS). Net income
for 2001 fiscal year amounted to $98 million ($0.046 per share
and $ 0.46 per ADS).

Pecom EnergĦa S.A. posted a $148 million loss for the fourth
quarter ended December 31, 2001. Net income for the twelve-month
period ended December 31, 2001 totaled $102 million.

Loss for the quarter was mainly attributable to:

a) A $92 million loss resulting from charging to income the
acquisition value in excess of Compa¤Ħa de Inversiones de EnergĦa
S.A. (CIESA) over the relevant book value. This derived from the
impact of the significant peso devaluation on CIESA's foreign
currency borrowing position as well as the uncertainty as to
projection of results due to the new economic measures
implemented.

b) A $47 million loss resulting from charging to income the
Minimum Presumed Income Tax credit. The negative impact derived
from exchange differences on Pecom EnergĦa's foreign currency
borrowing position as a result of the Argentine peso devaluation,
in addition to the uncertainty posed by the Argentine current
economic scenario, have negatively affected the expected recovery
of the said credit.

c) A $12 million loss posted by Pecom EnergĦa S.A. as a
consequence of the decision adopted by the Board of Directors of
our related company Transportadora de Gas del Sur S.A. (TGS) to
change the accounting criteria applied for recording the impact
of changes in United States producer price index for industrial
goods used to adjust gas transportation regulated rates. The
Board of Directors made this decision on account of the new
economic and regulatory scenario prevailing after the passing of
Public Emergency Law N.25,561 and Executive Order N.293/02,
providing for the pesification of utility rates and the
subsequent renegotiation thereof.

Pecom EnergĦa S.A.'s net sales amounting to $402 million in the
fourth quarter of 2001 increased by 3.9% compared to $387 million
in 2000 quarter. Sales for 2001 fiscal year reached $1,654
million, accounting for a 7.0% increase compared to $1,546
million in the previous year.

Oil sales volumes for 2001 were 24.6% higher than those for 2000
while gas volumes increased by 63.0%. In the Refining business,
sales volumes of diesel oil, main product of the Company's
Refinery, increased by 8.0%. In the Petrochemicals segment, sales
volumes of polystyrene, the business main product, rose by 66.7%.
Finally, in the electricity generation segment, electricity sales
volumes increased by 2.8%.

Pecom EnergĦa S.A.'s gross profit was $116 million in 2001
quarter, accounting for a 3.3% decline compared to $120 million
in 2000. Gross profit for 2001 fiscal year amounted to $524
million, accounting for a 5.6% increase compared to $496 million
in 2000.

Pecom EnergĦa S.A.'s operating income for 2001 fourth quarter was
$53 million, accounting for a $33 million decline compared to
2000 quarter. This 38.4% drop mainly results from a $4 million
gross profit decline, a $10 million increase in administrative
and selling expenses, a $7 million increase in exploration
expenses and a $12 million drop in income from equity in earnings
of affiliates mainly due to the change in the accounting method
applied by our related company TGS.

In 2001, operating income reached $386 million, accounting for a
4.0% drop compared to $402 million in 2000.

It is worth noting that the impact of the successive peso
devaluations after closing of fiscal year on the net foreign
currency position as of December 31, 2001 resulted in an exchange
loss of about $2,657 million as of this date. Under the
accounting standards recently issued in Argentina, the Company is
required to capitalize such exchange loss on certain assets,
under specific conditions and subject to approval by the
"Comisi˘n Nacional de Valores" (Securities Exchange Commission).

The Company is currently analyzing the above mentioned standards.
On the other hand, and as a consequence of the changes
implemented during the 2002 January-February period, the
wholesale price index increased by about 18.5%.

Such increase in wholesale prices evidences the country is no
longer in a context of monetary stability and financial
statements should be inflation adjusted so as to be restated in
constant currency according to general accounting principles even
when implementation of adjustment for inflation has been
discontinued under Executive Order N.316/95 issued in accordance
with the recently abrogated Convertibility Law.

The impact of inflation accumulated as of this date on monetary
positions as of December 31, 2001 generated a $542 gain from
exposure to inflation.

Perez Companc S.A.'s results for the full year of 2000 were
calculated based on its 98.21% stake in Pecom EnergĦa S.A.
resulting from the share swap completed on January 25, 2000. The
results for January 2000 are based on Perez Companc S.A.'s 28.92%
stake in Pecom EnergĦa S.A., which was its stake prior to the
share swap.

Net Sales

Sales increased by $15 million, or 3.9% in 4Q01 compared to 4Q00.
The following factors were the reasons for this variation:

- The oil and gas business registered a 26.9% increase in volumes
sold with a 15% drop in prices.

- In refining, the volumes sold increased by 9.1% with average
prices down 19%.

- In petrochemicals, volumes declined 11.5%, combined with a drop
of 5% in average prices.

- In the electricity business, generation volumes sold increased
13.4% with a drop of 6% in average prices.

- Hydrocarbon Marketing and Transportation sales declined 18.2%.

Gross Profit

The gross profit for the fourth quarter of 2001 was 3.3% below
the amount reported for the fourth quarter of 2000. The gross
margin declined from 31.0% in December 2000 to 28.9% in December
2001. The variations in the gross profit for the different
business segments was mainly due to the following factors:

- In the E&P business, as per the comments made regarding oil and
gas volumes and prices, and the increase in depreciations, the
gross profit was 12.2% lower. The gross margin declined from
39.4% in 4Q00 to 32.3% in 4Q01.

- In Refining, the gross profit for the fourth quarter of 2001
rose 10%. The gross margin increased to 14.7% in 4Q01 from 11.4%
in 4Q00. 4Q00 results includes a charge of $6 million for lower
cost of sales due to crude price hedging contracts while there
was no such charge in 4Q01. Excluding the effects of crude price
hedging contracts on the results, gross profit rose 175% in 4Q01.

- In Petrochemicals, a drop in gross profit was mainly due to the
significant drop in domestic styrene and polystyrene margins in
4Q01 compared to 4Q00, which reflect the drop in international
prices.

- Gross profit for the electricity business increased by 63.6%
mainly due to the fact that the support price of Pichi Pic£n
Leuf£ was recognized this quarter and there were higher sales of
nuclear fuels. Due to the depressed energy prices registered for
sales of Pichi Pic£n Leuf£ in the last 2 years, the estimates for
future prices, and as a result of the terms in its Concession
Contract, which, to ensured profitability that made this
investment viable, a support energy price was implemented and the
Company accrued a profit of $8 million this quarter. The gross
margin rose to 38.3% in 4Q01 compared to 33.3% in 4Q00, mainly
due to the support price.

Selling and Administrative Expenses

- The $10 million increase in 4Q01 compared to 4Q00 was mainly
due to the following:

- The $3 million increase in the Refining Business was due mainly
to the sales network expansion.

- Corporate administrative expenses rose $6 million due factors
including the amortization of e-commerce projects and costs
related to the launching of the PECOM brand.

Equity in Earnings of Affiliates

The main variation in the equity in earnings of affiliates were:

- A drop in the direct and indirect ownership in CIESA and TGS
from an income of $9 million in 4Q00 to a loss of $3 million in
4Q01. Given the new economic and regulatory scenario prevailing
as from the enactment of Public Emergency Law 25,561 and
Executive Order Nĝ293/02 that provide for the pesification of
utility rates and their subsequent renegotiation and for long
negotiation periods during which rates are established in pesos
at the same value prior to devaluation, TGS's Board of Directors
has decided to reverse income accrued during the years 2000 and
2001 derived from changes in US PPI for industrial goods used to
adjust the regulated rates for gas transportation. This change in
accounting criteria represents a negative impact of approximately
$12 million, which was fully recognized in the results for the
fourth quarter of 2001.

- The participation in Cerro Vanguardia S.A. registered an income
of $4 million in the fourth quarter of 2001 and did not register
income in 4Q00. This increase was due to the rise in sales
revenue as well as the different exchange rate applied to
exports.

Other (Expenses ) Income Net

- The loss resulting from charging to income the acquisition
value in excess of Compa¤Ħa de Inversiones de EnergĦa (CIESA)
(TGS's controlling company) over the relevant book value totals $
92 million in 4Q01. 4Q00 quarter mainly includes a reversal of
reserves.

Financial and Holding Results

In the fourth quarter of 2001, this figure increased by $18
million when compared to the fourth quarter of 2000 mainly due
to:

- An increase of $10 million in interest paid on the higher debt
levels, which was partially offset by the reduction in the LIBOR
rate.

- $9 million decline in interest income.

- The $2 million drop caused by the progressive decrease in tax
indebtedness helped offset these factors.

Income Tax

- In 4Q01, $ 47 million corresponding to a Minimum Presumed
Income Tax credit was charged to income.

During the full year of 2001, total assets rose by $701 million,
which represents an increase of 13%. Of this increase, $560
million correspond to the increase in fixed assets, while $307
million correspond to Cash and Investments.

Net debt (defined as debt net of total financial assets at the
end of the period) was $2,056 million as of December 31, 2001.
This represents a financial position equal to 73.0% of
shareholders' equity ($1,849 million and 66.6% as of December 31,
2000).

As of December 31, 2001, shareholders' equity reached $2,817
million, 1.4% above the amount reported as of December 31, 2000,
after the $65 million payment of dividends made on April 2001.

Financial Position

The crisis affecting the monetary and economic system, along with
Argentina's default on its debts in addition to measures such as
the move away from the Convertibility Law, the obligation to
replace dollar denominated prices with peso denominated prices
and all other measures affecting the financial system, have
worsened the severe lack of liquidity, further aggravated by the
lack of credit and capital inflows into the country.

Uncertainty on price and cost determination mechanisms, as well
as price and cost adjustment to offset devaluation effects, in
addition to several regulations that have affected regular
financial operations, render it difficult to maintain a stable
financial performance.

Refinancing of 2002 debt maturities is one of the Company's major
challenge. Therefore, a close monitoring of liquidity levels,
operating cash generation and securing financing in other
countries where the Company has operations will be the pillars of
2002 financial management

Operating Income by Business Segment

Oil and Gas Exploration and Production

Sales in this business segment rose 6.9% in the fourth quarter of
2001 to $201 million. This increase was due to the higher sales
of gas, which grew by 38.5% from $26 million in 4Q00 to $36
million in 4Q01 as well as higher oil sales, which rose 3.1% from
$163 million in 4Q00 to $168 million in 4Q01. Oil volume sold in
the fourth quarter of 2001 was 18.2% higher than in the fourth
quarter of 2000, while gas volumes rose 50.6% in 4Q01 compared to
4Q00.

In Argentina, the combined sales of oil and gas rose 14.0% to
$122 million. Oil sales in 4Q01 were 6.7% higher than in 4Q00
reaching $96 million while the daily volume sold rose 17.0% from
54.1 thousand barrels per day to 63.3 thousand barrels per day.
This growth was mainly due to the higher stakes in Santa Cruz I
and Santa Cruz II (8.6 thousand barrels per day of oil per day)
as well as the production improvements in other oil fields, which
stemmed from successful drilling campaigns, new oil wells and the
reactivation of developed zones. One factor that offset this
growth was the sale of Pampa del Castillo - La Guitarra area,
which brought sales down by 6.2 thousand barrels of oil per day.

The realization average net price per barrel dropped
significantly from $18.01 per barrel to $16.50 per barrel, a
decline of 8.4%. The WTI price declined by 36.0% from 4Q00 to
4Q01.

Natural gas sales revenue in 4Q01 increased significantly, by
53.0%, to $26 million in 4Q01. With the addition of production
areas received in the asset swap (103.9 million cubic feet per
day), gas volume reached 271.5 million cubic feet per day in
4Q01, up 57.2% when compared to 4Q00. The average sales price of
gas declined to $1.02 per million cubic feet in 4Q01 from $1.10
per million cubic feet in 4Q00 as a result of higher sales from
Austral basin with lower prices due to its far distance from
areas of consumption.

Abroad, combined sales of oil and gas declined by 2.4% in 4Q01 to
$80 million compared to $82 million sold in 4Q00. This decline
was a result of lower average sales prices, given that oil and
gas sales volumes were 22.2% higher in 4Q01 than in 4Q00.

In Venezuela, despite a significant reduction in the average
price per barrel, which dropped from $12.72 in 4Q00 to $10.88 in
4Q01, combined sales of oil and gas increased 12.8% in 4Q01 to
$53 million, due to higher sales volumes. The average oil volume
sold per day increased significantly, by 30.2%, to 50.9 thousand
barrels compared to 39.1 thousand barrels in 4Q00, mainly as a
result intense drilling activity and workover.

Gross profit for this business segment declined 12.2% to $65
million in 4Q01. The lower sales prices of oil and gas as well as
the increase in the depreciation generated by the investments
realized affected the gross margin, which dropped to 32.3% in
4Q01 from 39.4% in 4Q00.

Exploration expenses reached $10 million in 4Q01 compared to $3
million in 4Q00. This was mainly due to the shut down of
exploration wells in Argentina, the 3D seismic recorded in
Argentine exploration blocks and the 2D seismic recorded in
Ecuador.

Oil and Gas Reserves

As of December 31, 2001, the proven reserves of liquid
hydrocarbons and natural gas, audited by Gaffney, Cline &
Associates Inc. were 1,009.9 million boes, which includes 739.2
million barrels of crude oil, condensated and liquid natural gas
and 1,624.5 billion cubic feet of natural gas.

When compared to the levels registered as of December 31, 2000,
total reserves decrease by 20.9% due to a 9.2% drop in reserves
of crude oil, condensated and liquid natural gas and a 41.4%
decline in natural gas reserves. This drop in reserves is mainly
the result of the asset swap and the sale of Pampa del Castillo -
La Guitarra area.

Considering the geographic location of our reserves, out of a
total of 1,009.9 million boes, close to 58% are located abroad
(61% as of December 31, 2000).

Taking into account the production volume of 2001, the reserve
life is 15 years.

Hedge of Produced Crude Oil Price

The Company, as a crude oil producer, is exposed to the related
price-fluctuation risk. In such conditions, the Company uses
various derivative instruments to mitigate such risk. These
instruments use West Texas Intermediate (WTI) as reference price,
which is used mainly to determine the sale price in the market.

Income (loss) generated by such instruments, used to hedge crude
oil price, are deferred until the related foreseen transaction is
recognized and are recorded in the income statement as an
integral part of hedged sales.

As of December 31, 2001, the Company has oil hedge agreements for
year 2002, where hedging is of 45,500 bbl/d. For WTI prices below
15 US$/bbl, the hedging price is 17.6 US$/bbl, while for WTI
prices equal or above 15 US$/bbl, the hedging price amounts to
18.9 US$/bbl.

For the year 2003, the option agreements provide a more flexible
structure. For WTI prices below 20 US$/bbl, the hedging price is
19.9 US$/bbl and the hedging volume amounts to 50,000 bbl/d. For
WTI prices equal to or above 20 US$/bbl and below 21 US$/bbl, the
hedging price is 19.8 US$/bbl and the hedging volume falls to
25,000 bbl/d. For WTI prices equal to or above 21 US$/bbl and
below or equal to 27 US$/bbl, coverage is not applicable. For WTI
prices above 27 US$/bbl, the hedging volume increases to 35,000
bbl/d and the hedging price is 25.8 US$/bbl. Premiums paid amount
to 11 and such an impact was distributed among each reported
hedging price. In addition, there are options with a contingent
premium whose value depends on the WTI price. The value of such
premiums payable varies from 0 to 7 for a WTI price between 20
US$/bbl and 27 US$/bbl, respectively. For a WTI price below 20
US$/bbl, the contingent premium is zero.

For the January 2003 - December 2005 period, the Company carries
sold options for a volume of about 31.1 million barrels (an
average of 28,300 bbl/d) at an average exercise price of 20.4
US$/bbl.

Refining

The gross profit of this business segment rose 10% in the fourth
quarter of 2001. The gross margin increased to 14.7% in 4Q01
compared to 11.4% in 4Q00. 4Q00 results include a charge of $6
million for lower costs of sales due to crude price hedging
contracts while there was no such charge in 4Q01. In 4Q01, the
spread of refining per barrel rose 31% to $12.9/bbl compared to
$9.9/bbl in 4Q00.

Sales of refined products dropped 15% during 4Q01 to $75 million
due mainly to lower sales prices.

The volume of crude processed declined 9% due to a scheduled
plant shutdown of 25 days for oven changes and maintenance. The
total sales volume was not affected by the reduction in crude
processing due to the purchase of 33,000 cubic meters of virgin
naphta and to the resale of 30,000 cubic meters of gas oil.

During 4Q01, the commercial performance of the Argentine industry
was severely affected by the economic recession. In December
2001, the domestic consumption of gasolines and diesel oil,
compared to December 2000 declined 15.9 and 13.7 respectively.
However, the Company was able to offset this trend and improve
its position in the market, through the strengthening of its
commercial activities and the expansion if its retail channel. In
the full year of 2001, the commercial network increased in 18 gas
stations (4 operated directly by the Company), 4 diesel centers,
1 agri service station and 4 mobile gas stations.

The sales volumes of diesel oil and gasoline increased due to
higher sales in the retail channel, while asphalt sales declined
10.8% due to the stoppage of the majority of construction in
progress.

Selling and administrative expenses rose by $3 million to $8
million due to the expansion of sales network expansion.

Petrochemicals

Gross profit for this business segment dropped 17.4% in 4Q01. The
gross margin remained flat at 20% in both periods.

In 4Q01, international and domestic margins of styrene and
polystyrene were significantly below those reported in 4Q00.
While the lower prices of crude allowed for a reduction in raw
material costs, mainly of benzene, the lower demand caused by the
slowdown of economic growth in the U.S. worsened the drop in
styrene and polystyrene prices. In this environment, the
difference between international prices of crystal polystyrene
(South East Asia) and the mix of raw materials benzene and
ethylene (U.S. Gulf Coast) decreased 37% while the difference
between styrene (U.S. Gulf Coast) and the mix of raw materials
benzene and ethylene (U.S. Gulf Coast) dropped 41%. In addition
to the international pricing trends, the sales spreads of
polystyrene and styrene dropped respectively by 33% (to $410 per
ton) and 1% (to $248 per ton) in Argentina, and 24% (to $397 per
ton) and 31% (to $180 per ton) in Brazil.
The contribution margins of fertilizers produced for internal use
and for resale posted declines of 8% and 12%, respectively.

Sales for the petrochemical business declined by 14.4% due to a
significant drop in sales prices which were partially offset by
the fact that the Innova plant in Brazil was fully-operational
during 4Q01.

Sales of styrene products in Argentina declined 25%, resulting
from a simultaneous drop in volumes sold as well as sales prices.
Domestic and exported sales volumes of styrene dropped 27% and
67%, respectively. Similarly, domestic sales volumes of
polystyrene declined 19% and were replaced by exports 79% higher
than in 4Q00. The recession of the Argentine market in 2001 (drop
in styrene market of approximately 10% during 2001) and the high
level of styrene exported to non-traditional markets (traditional
markets are Mercosur and Chile), made in the third quarter to
take advantage of the high international prices were the main
reasons for the decline in sales volumes. During 4Q01, the higher
polystyrene exported to non-traditional markets, offset this
decline. Sales prices of styrene and polystyrene dropped by 20%
and 32%, respectively.

Sales of Innova increased 13% in 4Q01. The increase in
competitiveness generated by the full operation of the plants as
well as the increase in household demand led to a greater market
share of styrene and polystyrene, with sales volumes up 20% and
81%, respectively. On the other hand, sales prices of styrene and
polystyrene declined 31% and 29%, respectively, with
international prices dropping by 34% and 35%, respectively.

Fertilizer sales declined 24% in 4Q01 due to a reduction not only
in volumes, but in sales prices as well. The total volume sold
declined by 21% due to the 30% decline in corn seeding resulting
from excessive rains and the sharp economic recession in
Argentina. Domestic sales prices dropped 5%, associated with a
decline in international urea prices in the same proportion.

Hydrocarbon Marketing and Transportation

Sales in this business segment for 4Q01 declined by 18% when
compared to 4Q00. Revenue from the production and marketing of
liquids increased to $7 million in 4Q01 from $5 million in 4Q00
mainly as a result of a significant increase in volumes sold
which were partially offset by a 30% decline in sales prices.
Total sales volumes of LPG increased from 19,800 tons in 4Q00 to
38,000 tons in 4Q01.
Brokerage services of oil, gas and LPG, represented revenues of
$2 million and $6 million in 4Q01 and 4Q00, respectively.

Gross profit from marketing activities remained flat at $2
million due to the change in product sales mix, with higher
revenue participation from the production and marketing of
liquids, which has better margins than brokerage services of oil,
gas and LPG.

Revenue from affiliates posted a loss of $1 million due to the
following:

- The result derived from the direct and indirect participation
in CIESA and TGS registered a loss of $3 million in 4Q01 compared
to a profit of $9 million in 4Q00.

- The combined profit of the Company's stakes in Oldelval S.A.
and Termap S.A. totaled $2 million in 4Q01 compared to $3 million
in 4Q00.

Electricity

Sales corresponding to generation activities were $27 million for
both quarters.

Sales from Genelba rose to $23 million in 4Q01 from $21 million
in 4Q00, due to an increase in sales volume, which was partially
offset by a drop in the sales price.

The 30.9% increase in sales volume stems from a scheduled
maintenance shutdown which took place during 4Q00.

The average price declined by 11.8% due to high water levels in
Salto Grande, the lower exports in Brazil in 2001 and a decline
in generation at the nuclear plants in 2000.

Sales from Pichi Pic£n Leuf£ declined to $4million in 4Q01 from
$6 million in 4Q00 due to generation levels that were 26.4% lower
at the plant resulting from low water levels in the Comahue
Basin. This was partially offset by a 6.1% increase in sales
prices.

Sales of nuclear fuel and others increased to $11 million in 4Q01
compared to $4 million in 4Q00 which is when the Company had
restricted activity due to temporary shutdowns at the nuclear
plants.

Gross profit for this business segment increased by 63.6% mainly
due to the fact that the support price of Pichi Pic£n Leuf£ was
recognized this quarter and there were higher sales of nuclear
fuels. The gross margin rose to 38% in 4Q01 compared to 33% in
4Q00 mainly due to yield of the support price, which helped
offset the drop in prices.

Income from affiliates in this business segment totaled $9
million in 4Q01. Profit from the stake in Distrilec Inversora
declined from $7 million in 4Q00 to $6 million in 4Q01.
Profits from the stakes in Citelec and Yacylec also remained flat
in both periods at $2 million and $3 million, respectively.

Other Investments

Income from forestry activity stayed flat at $5 million in both
quarter, while income from the farming and cattle operation
declined to $9 million in 4Q01 compared to $11 million in 4Q00
due to a drop in cattle sales and production resulting from lower
volumes as well as a drop in prices.

Income from affiliates investments increased due to the
following:

Income from the stake in Cerro Vanguardia S.A. was $4 million in
4Q01 while there was no income reported for 4Q00.

The stake in Pecom Agra S.A. did not register a profit in 4Q01
while it incurred a loss of $1 million in 4Q00.

Pecom EnergĦa S.A., controlled by Perez Companc S.A., is the
largest independently owned energy company in the Latin American
region. Its business activities include oil and gas production
and transportation, refining and petrochemicals, power
generation, transmission and distribution as well as forestry
activities. Headquartered in Buenos Aires, the Company has
operations throughout Argentina, Brazil, Venezuela, Bolivia, Peru
and Ecuador.

CONTACTS:  Pecom Energia S.A. de Perez Companc S.A.
           Maipo 1 - Piso 22 - C1084ABA
           Buenos Aires, Argentina
           Phone: (54-11) 4344-6000
           Fax: (54-11) 4344-6315
           URL: http://www.pecom.com.ar


TGN/BHN: S&P Explains Transactions' Technical Default
-----------------------------------------------------
Aftershocks of Argentina's default on $141 billion in public debt
payments continue to reverberate throughout the financial markets
as a succession of ratings activities sweep the country. Among
the issues at hand are four structured finance transactions
downgraded to default by Standard & Poor's in February--a
development that has generated questions in the financial
community.

When a transaction is in default, the understanding in many cases
is that this means absolute nonpayment of any principal and
interest that is due. But it is not always so black and white.
Bondholders in the four structured finance transactions
downgraded by Standard & Poor's in February--TGN IFC Trust I and
TGN IFC Trust II certificates and bonds on BHN II and BHN III
Mortgage Trust--may continue to be paid funds, but not in the
full amounts that were due to them according to the original
terms and conditions of each issuer's obligation, said Jorge
Solari, a director in Standard & Poor's Structured Finance group
in Buenos Aires.

The TGN transactions defaulted because the underlying obligor,
Transportadora de Gas del Norte S.A., paid only the interest, but
not the principal, on the International Finance Corp. (IFC) loans
backing the structured transactions. The BHN transactions were
downgraded to 'D' because new government regulations issued on
Feb. 3 "pesified" the monthly trust obligations of U.S. dollar-
denominated payments due on the bonds at a one-to- one parity.
"Consequently, the BHN investors now receive payments that are in
lower than amounts owed before the original dollar debt
redenominated," Mr. Solari explained.

These transactions will remain in default if the issuers do not
resume payments according to the original obligations; the
issuers must also pay investors any previously owed amounts,
along with accrued interest. However, if investors agree on a
rescheduling of their credit "Standard & Poor's would rate the
'new' debt based on its new terms and conditions and our
assessment of the issuer's ability to meet its obligations," said
Mr. Solari. "For example, in the case of BHN, since both the
underlying mortgages and debt were pesified, it may well be that
the dollar amount will be restructured into new peso debt, where
the trust will have peso obligations with new terms and
conditions. Then Standard & Poor's would assign a new rating to
that obligation and withdraw the 'D' rating on the previously
existing dollar obligations."

As the financial, economic, and political crisis took hold in
Argentina over the past several months, Standard & Poor's also
downgraded several companies in that country to selective default
('SD'). The 'SD' rating relates to the issuers, not the issues
themselves. If an issue is not being paid in full and on time, it
is rated 'D' for default. "Similarly, if an issuer is generally
not honoring its financial obligations, then the issuer rating
would be 'D'," Mr. Solari noted. Alternatively, selective default
ratings are issuer ratings used for issuers that are in default
on some, but not all, of their obligations. The TGN IFC I and II
transactions were rated double-'C' until Feb. 25, because
investors were receiving all of their payments on time, while the
company's local and foreign currency ratings were 'SD', as TGN
had begun defaulting on some, but not all, of its financial
obligations. Then, when TGN failed to honor its full payment
obligations on the IFC loans on Feb. 25, its local and foreign
currency ratings were reduced from 'SD' to 'D', reflecting
expectations that the company would not pay debt service in full
on a timely basis on any debt obligations, and the IFC
transactions were also downgraded to 'D'. Structured finance
transactions, thus, do not use the 'SD' rating since that rating
is always on an issuer and never on the issue.

When a transaction is in default, Standard & Poor's may continue
to monitor and report the performance of the transaction for the
benefit of all interested parties, Mr. Solari clarified.
"However, Standard & Poor's reserves the right to withdraw
ratings, for example, due to lack of information." For more
information, please contact the following analysts: Jorge Solari,
Structured Finance, Buenos Aires; Diane Audino, Structured
Finance, New York.

CONTACT:  STANDARD & POOR'S
          Jorge Solari, Buenos Aires, +54-114-891-2114
          Diane Audino, New York, +1-212-438-2388



=============
B E R M U D A
=============

GLOBAL CROSSING: CEO Intends To Slash Costs To Avert Liquidation
----------------------------------------------------------------
John Legere, the chief executive of bankrupt Global Crossing
since October, has abandoned corporate airplanes and posh office
space as part of an effort to cut costs in order to avert
liquidation by creditors.

Legere is mounting a public relations campaign to counter
unfavorable publicity -- including stories of spendthrift
executives, as he steers the Company through a reorganization
following its Chapter 11 bankruptcy filing in January.

Just recently, he also announced that he would cut his pay by 30
percent, but the rest of his compensation would remain in place.

Legere got a signing bonus of US$3.5 million and a salary of
US$1.1 million when he became Global Crossing's CEO in October, a
Securities and Exchange Commission filing revealed. Legere
explained he earned the bonus for the challenge of turning the
Company around.

He also revealed that the US$15 million loan to him that was
forgiven by Asia Global covered risks he took by leaving Dell
Computer for Asia Global in 2000.


GLOBAL CROSSING: Some 40 Companies Express Bidding Interest
-----------------------------------------------------------
Global Crossing Chief Executive John Legere announced over the
weekend that more than 40 companies have entered negotiations and
discussions regarding the purchase of all or part of the Bermuda-
based bankrupt telecommunications company, reports Dow Jones.

However, according to Legere, the only official offer is the
US$750-million joint bid from Hutchison (Whampoa) and Singapore
Technologies announced in January.

"That's natural because they had a long lead time in doing due
diligence," Legere explained.

Legere said more than 40 companies have signed confidentiality
agreements to secure information about investing in Global
Crossing. The executive declined to name any interested parties
other than Hutchison Whampoa and Singapore Technologies or to
confirm recent media reports that Texas Pacific Group and Gores
Technology Group are interested in entering the bidding process.
Platinum Equity has separately confirmed it is interested in
bidding for Global Crossing.

Singapore Technologies Telemedia began discussions with Global
Crossing last summer, and joined forces with Hutchison in the
fall, said Legere.

A US$25 million investment by Global Crossing's chairman in a
company owned by the same government-run entity that owns
Singapore Technologies has opened the offer up to challenges that
the company may not have secured the best bid possible offer for
shareholders. Legere said he does not believe the allegations of
conflicting interests, noting the high level of government
ownership in most of Singapore's companies.



===========
B R A Z I L
===========

GLOBO CABO: Rights Offering Next Step to Raise Funds
----------------------------------------------------
Brazil's state development bank BNDES will propose a rights
offering for Globo Cabo SA in an effort to raise money for the
cash-strapped cable television operator, reports Bloomberg.

Expectation is that Organizacoes Globo, Latin America's largest
media company, and other Globo Cabo shareholders such as
Microsoft Corp. and Bradespar SA will take part in the rights
offering.

BNDES is also a shareholder of Globo Cabo, Brazil's largest
cable television operator.

At the end of September, Globo Cabo's debts soared to BRL1.82
billion from BRL1.55 billion in the previous year.

The Company has reportedly invested US$2 billion to install a
network across the country, but has never seen a return on that
investment.

In terms of stock price, the Company is the fourth-worst
performer in Brazil this year, down 11 percent since the
beginning of January, compared with a 2.8 percent gain in the
benchmark Bovespa index.

CONTACT:  GLOBO CABO S.A.
          INVESTORS:
          Luis Henrique Martinez, 5511-5186-2684,
          lmartinez@globocabo.com.br,

          Marcio Minoru, 5511-5186-2811,
          minoru@globocabo.com.br,


INDUSTRIAS KLABIN: May Reduce Debt With Asset Sales
---------------------------------------------------
In a bid to reduce its BRL2.4-billion (US$1 billion) debt to
about BRL1.5 billion, Klabin SA, Brazil's largest pulp and paper
company, is considering a sale of its pulp or tissue businesses
within the next 12 months, reports Bloomberg.

The Company is considering two options: to sell one of the two
businesses entirely, or sell a minority stake to a partner,
informed Miguel Sampol Pou, Klabin's incumbant chief executive
officer. Pou is expected to take office this April, replacing
Josmar Verillo, who stepped down for personal reasons.

The Sao Paulo-based company plans to focus on paper, packaging
and cardboard products instead.

"Our debt is bigger than what we would like it to be," said Pou.
"We can reduce that by increasing revenue from our existing
business, being more selective about our investments, or selling
some of assets."

Approximately BRL1.13 billion of Klabin's debt, or 45 percent,
matures this year. The Company plans to slash spending this year
by 22 percent to BRL250 million, from BRL320 million last year,
Pou said, to make more cash available for debt payments.

CONTACT:  Industrias Klabin de Papel e Celulose S.A. (IKPC)
          Rua Formosa, 367, 12 Andar
          01049-000 Sao Paulo, Brazil
          Phone: +55-11-3225-4000
          Fax: +55-11-3255-4067
          Home Page: http://www.klabin.com.br
          Contact:
          Israel Klabin, Chairman
          Miguel Sampol, CEO
          Ronald Seckelmann, Investor Relations CFO and Director


VASP: Nears Debt Agreement With Banespa
---------------------------------------
The Brazilian airline Vasp, which commands 14.7 percent of the
air transportation market, is about to reach an agreement on debt
owed to commercial bank Banespa (Santander), reports O Estado de
Sao Paulo.

Vasp finished September 2001 with a negative net worth of
BRL208.5 million. Its debt totaled BRL364.5 million, of which
BRL293.5 million is long-term. The Company also posted a loss of
BRL115.7 million in the third quarter of 2001, compared to a loss
of BRL126.5 million in the same period in the previous year. The
operating results between January and September 2001 totaled
negative BRL385.4 million.

CONTACTS:  VASP
           (For Investors)
           Cesis Canhedo, Chief Financial Officer
           PraOa Comandante Lineugomes, s/n
           04626-910 Sao Paulo, Brazil
           Phone: +55-11-532-3000
           Fax: +55-11-533-0444



=========
C H I L E
=========

EDELNOR: Reveals Plan To Cut Financing Payments
-----------------------------------------------
Chilean energy generator Empresa Electrica del Norte Grande SA
(Edelnor) issued a statement to the country's regulators
disclosing its plan to reduce its financing payments, according
to a report released by Bloomberg.

Under the proposed plan, the cash-strapped energy generator would
offer to buy back at least 95 of US$340-million debt owed to
bondholders. The company may purchase the debt with new bonds
backed by Edelnor assets, buy some of the debt from bondholders
in cash at a discount, or make a cash offer for all of the debt
at an equal discount. Exactly how much of a discount depends on
negotiations with bondholders, Edelnor said.

In January, Edelnor Chairman Fernando del Sol said that the
Company must cut its financing costs to avoid bankruptcy.

Edelnor has an interest payment due Friday on US$250 million of 7
3/4 percent bonds due in 2006. Rating company Moody's Investors
Service has predicted that Edelnor will probably default on its
debt.

Edelnor's liabilities also include US$90 million in 10 1/2
percent bonds due in 2005.

The Company has lost CLP54.8 billion (US$79 million) since
1999, after energy prices dropped in northern Chile and Edelnor's
financing costs surged after it borrowed to build power plants.

In December, F.S. Inversiones Ltda, an investment company owned
by del Sol, bought an 82.3 percent stake in Edelnor from U.S.-
based Mirant Corp.

CONTACT:  Empresa Electrica Del Norte Grande SA (EDELNOR)
          Avenida Grecia 750
          Antofagsta, Chile
          Phone: +56 55 248500
                 +56 55 248094
          Contact: Fernando del Sol, Chairman



===========
M E X I C O
===========

CINTRA: ASPA Wants To Delay Sale
--------------------------------
The Union Association of Flight Attendants (ASPA) believes that
the time to sell Cintra, owner of Mexico's leading airlines
Mexicana and Aeromexico, has not yet come.

The union supports its position by saying that the stock market
is not ready for the process, nor are there any regulations that
ensure fair competition. ASPA spokesman, Francisco Esquivelzeta,
said that although there is an aeronautical policy, "it is still
not in practice."

Additionally, the ongoing price war is causing "weakness, debt
and the disintegration of the industry," instead of helping the
industry consolidate.

The sale of Cintra must be carried out if or when there is a
political framework for operation and regulation," Esquivelzeta
said.

ASPA raised its concern after Fernando Sanchez Ugarte, the
president of the Federal Competition Commission (CFC), suggested
that "it is time to decide the sale" of Cintra.

The CFC head has urged Mexico's Bank Savings Protection Institute
IPAB, which controls 51 percent of Cintra, to find a solution to
the problem regarding the sale process of the government airline
holding company.

A few days ago, Julio Cesar Mendez, executive secretary of IPAB,
also advised that Cintra's sale process should be carried out "as
soon as possible, to diminish the costs that IPAB has in terms of
liabilities."

IPAB is looking to sell Cintra in a bid to recover MXN18 billion
(US$1.98 billion) this year from sales of assets. Should the
institution fail to sell Cintra, its present debt of more than
MXN174 billion (US$19.16 billion) will continue to grow.

CONTACTS:  CINTRA
           Jaime Corredor Esnaola, Chairman
           Juan Dez-Canedo Ruiz, CEO
           Rodrigo Ocejo Rojo, CFO

           Xola 535, Piso 16, Col. del Valle
           03100 M,xico, D.F., Mexico
           Phone: +52-5-448-8050
           Fax: +52-5-448-8055

           OR
           C.P. Francisco Cuevas Feliu, Investor Relations
           Xola 535, Piso 16
           Col. del Valle
           03100 M,xico, D.F.
           Tel. (52) 5 448 80 50
           Fax (52) 5 448 80 55
           infocintra@cintra.com.mx

           AEROMEXICO
           Mayte Sera Weitzman of AeroMexico, +1-713-744-8446, or
           mweitzman@aeromexico.com

           MEXICANA DE AVIACION
           Jenny Jenks, Marketing Director, International
           Division of Mexicana Airlines, +1-210-491-9764, or
           ennyjenks@mexicana.com


GRUPO MEXICO: Workers Remain On Strike Over Wages
-------------------------------------------------
The strike lodged by the workers at the four units of Grupo
Mexico last week continued on Monday as workers seek
reconsideration to their demands for a wage hike of between 8
percent and 10 percent. So far, Grupo Mexico, the world's largest
mining company, has only offered a 5-percent salary increase.

"Ours is not a capricious or fanciful demand but a just and
balanced one," said Napoleon Gomez, secretary general of the
National Mining and Metallurgical Union. "We call on the company
to reconsider their attitude."

About 3,000 workers walked out of the copper mining, smelting and
refining facility at La Caridad, in Mexico's northern Sonora
state and from zinc operations in Zacatecas and Coahuila states
last Tuesday.

Another 800 workers -- taking the total to more than 4,000 --
joined the strike at Grupo Mexico's electrolytic zinc refinery in
San Luis Potosi state last Thursday after the Company failed to
meet union demands.

Union officials and management met for talks last week but failed
to hammer out an accord. Talks between the opposing groups will
resume later on Monday at the labor ministry, which arbitrates
union disputes.

Grupo Mexico has been struggling with a debt load of US$2.5
billion and has also seen a decline in its earnings. The
Company's operating earnings in the fourth quarter of 2001 were
down 125 percent compared to the same period a year ago, and down
64 percent for the just-completed fiscal year.

CONTACTS:  GRUPO MEXICO S.A. DE C.V
           Avenida Baja California 200,
           Colonia Roma Sur
           06760 Mexico, D.F.
           Mexico
           Phone: +52-55-5264-7775
           Fax: +52-55-5264-7769
           http://www.gmexico.com
           Contacts:
           German Larrea Mota-Velasco, Chairman & CEO
           Xavier Garcia de Quevedo Topete, President & COO


HYLSAMEX: Pays Half of Interest Payment on Mexican Bond
-------------------------------------------------------
Hylsamex SA, Mexico's second-largest steelmaker, which warned
earlier that it would default on its bond payment, informed that
it paid about half of a MXN29.8-million (US$3.3 million) coupon
on a Mexican bond, relates Bloomberg.

Hylsamex made a MXN15.6-million interest payment on the 8 3/4
percent bond maturing in 2005 as an economic recession and
falling steel prices hurt its ability to make good on its debt
obligations.

The Monterrey-based steelmaker is also likely to miss a US$13.9-
million interest payment on a US$300-million Eurobond. The
payment on the 9 1/4 percent bond maturing in 2007 is due Friday.

"The steel cycle and low steel prices hasn't helped Hylsamex's
financial situation," said Carlos Hermosillo, an analyst at
Vector Casa de Bolsa SA.

Hylsamex is expected to ask bondholders on the 2005 bond to
stretch the maturity of the debt until 2007. Holders of the
Eurobonds due in 2007 will likely be asked to extend the payments
on half of the bonds to 2010, said Francisco Suarez, an analyst
with Banorte Casa de Bolsa SA.

Hylsamex started talks in December with banks to stretch out
payments on US$627 million in loans after the Company stopped
making interest payments.

The Company wants to gather its bank loans into two groups: one,
totaling US$362 million would mature in six years; another, for
US$265 million, would come due in 2009.

Alfa SA, Hylsamex's parent, has said it would provide US$25
million in loans to the Company and earmark US$75 million to
repurchase its debt at a discount if banks agree to extend
maturity on the loans. An agreement with bankers is expected by
the end of the month.

The Company's creditor banks include Banamex-Citibank, BBVA
Bancomer, Bayerische Hypo-Vereins Bank and JP Morgan Chase.

CREDITOR BANKS:  BAYERISCHE HYPO- UND VEREINSBANK AG
                 Am Tucherpark 14
                 D-80538 Mnchen
                 Aktion,rs-Hotline*: 00800 - 378 000 00
                 (*kostenfrei und nur aus D, A, CH)
                 Tel: +49 (89) 3 78 - 2 52 76
                 Fax: +49 (89) 3 78 - 2 40 83
                 Email: ir@hvbgroup.com
                 http://www.hypovereinsbank.de
                 Contacts:
                 Christian Becker-Hussong
                 Phone: +49 (89) 3 78 - 2 82 35
                 Email: Christian.Becker-Hussong@hvbgroup.com

                 Susan Eckenberg
                 Phone: +49 (89) 3 78 - 2 91 85
                 Email: Susan.Eckenberg@hvbgroup.com

                 JP MORGAN CHASE
                 60 Wall Street
                 New York, NY 10260
                 Phone: (212) 483-2323/648-5545
                 http://www.jpmorgan.com

                 BBVA BANCOMER
                 Av. Universidad 1200,
                 Col. Xoco, M,xico, D.F.
                 Phone: (52) (55) 5621-7912
                 http://www.bancomer.com.mx/
                 Contacts:
                 David S nchez-Tembleque
                 Tel: (52) (55) 5621-4938
                 Email:investor.relations@bbva.bancomer.com

                 Jos, de Jesos G>mez Dorantes
                 Tel: (52) (55) 5621-4718

                 Araceli Espinosa Elguea
                 Tel: (52) (55) 5621-2718


PEGASO: QUALCOMM Signs Letter of Intent with Telefonica Moviles
---------------------------------------------------------------
QUALCOMM Incorporated (Nasdaq: QCOM), acknowledged Monday the
announcement made by Telefonica Moviles regarding the execution
of a non-binding Letter of Intent (LOI) to acquire a controlling
interest in Pegaso Telecomunicaciones, S.A. de C.V., a wireless
operator in Mexico. As contemplated by the LOI, Telefonica would
acquire 65 percent of Pegaso's equity from existing shareholders
and the Burillo Group would continue to own 35 percent.
Consummation of the transaction is dependent on satisfying
certain requirements, including but not limited to executing
definitive documents and obtaining all necessary regulatory
approvals.

Specific financial terms were not disclosed as the parties to the
LOI are subject to a confidentiality agreement. Tony Thornley,
president and chief operating officer of QUALCOMM, did disclose,
however, that the transaction, as proposed, "Would maintain the
value of QUALCOMM's investment in Pegaso." Also, Mr. Thornley
said, "As a result of the transaction, a portion of the amounts
owed by Pegaso to QUALCOMM will be repaid and QUALCOMM would
support Telefonica's Mexican operation as a senior secured
lender."

"We look forward to Telefonica Moviles, one of the world's
leading wireless companies, leveraging its international
experience and combining Telefonica Moviles' existing Mexican
operations with Pegaso's into a nationwide CDMA network in
Mexico."

QUALCOMM Incorporated ( www.qualcomm.com) develops and delivers
digital wireless communications products and services based on
the Company's CDMA digital technology. Headquartered in San
Diego, Calif., QUALCOMM is included in the S&P 500 Index and is a
2001 FORTUNE 500(R) company traded on The Nasdaq Stock Market(R)
under the ticker symbol QCOM.

CONTACT:  QUALCOMM Incorporated, San Diego
          Corporate Public Relations
          Christine Trimble, 858/651-3638
          Fax: 858/651-5873
          ctrimble@qualcomm.com
                 or
          Investor Relations
          Julie Cunningham, 858/658-4224
          Fax: 858/651-9303
          jcunningham@qualcomm.com


PEGASO: Owes Qualcomm US$674 Mln
--------------------------------
Pegaso had a US$414-million bridge loan and a US$260-million
equipment loan outstanding from San Diego-based Qualcomm as of
December 30, reports Bloomberg.

According to a regulatory filing from January, Qualcomm stated
that it stopped accruing interest on the loans at the start of
its fourth fiscal quarter, which began in July.

Qualcomm Inc. said Telefonica Moviles SA will repay part of
Pegaso's US$674 million in debt to Qualcomm under the Purchase
terms. However, Qualcomm isn't disclosing the amount of debt that
Telefonica will repay.



=================================
T R I N I D A D   &   T O B A G O
=================================

BWIA: Workers Begin Applying For Voluntary Severance Program
------------------------------------------------------------
Workers began applying for BWIA West Indies Airways' voluntary
severance program last week, reveals The Trinidad Guardian.

A BWIA spokesperson said the airline was pleased with the
response it got from workers. The evaluation of these
applications is the next step in the exercise, said the
representative.

Meanwhile, applications for VSEP were due in last week, however,
BWIA did not disclose the value of the VSEP packages.

BWIA continues to keep the workers trade unions abreast of its
decisions. Some 141 jobs have been made redundant.

BWIA is offering a voluntarily redundancy package in an attempt
to keep costs down as a result of the turbulence in the airline
industry following the September 11 terrorist attack in the US.

BWIA first reacted to decline in the travel market by reducing
flights by 10 percent, and subsequently cut travel agents'
commission to 6 percent from 9 percent.

Last October, BWIA carried 10,000 fewer passengers on its routes
through the Caribbean, eastern United States, Toronto and England
compared with the same period in 2000. Travel on the airline
plummeted by 25,000 in November when compared to November 2000.

Airline President Conrad Aleong estimates that if the decline in
travel keeps up, the airline could lose US$30 million of its
average US$260 million in annual revenue.

CONTACTS:  BWIA West Indies Airways
           Phone: + 868 627 2942
           E-mail: mailto:mail@bwee.com
           Home Page: http://www.bwee.com/
           Contacts:
           Conrad Aleong, President and CEO (Trinidad)
           Beatrix Carrington, VP Marketing and Sales (Barbados)
           Paul Schutz, Chief Financial Officer (Trinidad)



               ***********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter Latin American is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Trenton, NJ,
and Beard Group, Inc., Washington, DC. John D. Resnick, Edem
Psamathe P. Alfeche and Ma. Cristina Canson, Editors.

Copyright 2002.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
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Information contained herein is obtained from sources believed to
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