/raid1/www/Hosts/bankrupt/TCRLA_Public/020801.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

           Thursday, August 1, 2002, Vol. 3, Issue 151

                           Headlines


A R G E N T I N A

LOMA NEGRA: Negotiating With Creditors To Avoid Receivership
REPSOL YPF: Increases Net Profit By 4.6% To Over EUR1.3B


B E R M U D A

GLOBAL CROSSING: John Legere Testifies Before US Congress
GLOBAL CROSSING: Ex-COO Expected To Bid For Assets


B R A Z I L

BCP: To Default On $14.5M Debt Coming Due Aug 1
JERONIMO MARTINS: Brazil Blocks Sale Of Se To Pao de Acucar
NET SERVICOS: Shareholders Agree to BRL1B Recapitalization
VARIG/VASP: Government Assistance to Rescue Troubled Airlines


C H I L E


ENERSIS: Files Letter of Intent with the SEC
ENERSIS: S&P Affirms Enersis, Endesa Chile Ratings
MADECO: Shares Continue Slide On Uncertain Capitalization Result


E C U A D O R

FILANBANCO: Ecuador Banking Board Initiates Liquidation Process


H O N D U R A S

CHIQUITA BRANDS: Reports Improved Second Quarter Results


M E X I C O

AEROMEXICO: To Replace 15 Aircraft With Boeing Jets
CINTRA: Reports Second Quarter 2002 Results
GRUPO BITAL: 2Q02 Results Show Weak Performance, Says S&P
GRUPO IUSACELL: Shares Down On Analysts' Negative Outlook
GRUPO MEXICO: In Debt Talks With Creditors
ISPAT INTERNATIONAL: Extends Exchange, Solicitation Consent Date
MAXCOM TELECOMUNICACIONES: 2Q02 Results Show Improvement
PEMEX PETROQUIMICA: Pemex Combines Units Into Single Subsidiary


P E R U

BACKUS: Bavaria To Visit Peru To Deal With Polar's Claims


U R U G U A Y

BANCO DE MONTEVIDEO: Massive Withdrawals Lead To Suspension


V E N E Z U E L A

SIDOR: Creditors, Government Approve 60-Day Debt Restructuring


     - - - - - - - - - -


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

LOMA NEGRA: Negotiating With Creditors To Avoid Receivership
------------------------------------------------------------
Financially choked Argentine cement company Loma Negra is trying
to negotiate with creditors in order to reach an extra-judicial
agreement that would avert calling in the receivers.

According to an Ambito Financiero report, 5 institutions will
lead these negotiations and will represent another 25 financial
institutions including pension funds and bondholders. Loma Negra
will be represented by the investment bank Morgan Stanley.

Loma Negra found itself mired in debt after it squandered money
to expand its cement production plants in Buenos Aires province.
The production of cement in Argentina failed to reach 35% of the
installed capacity (of Loma Negra and its competitors). The Swiss
cement company Holderbank (today Holcim), which acquired the
local companies Corcemar and Minetti, is Loma Negra's main
competitor.

Loma Negra was also brought to its knees by the devaluation of
the Argentine currency, which led to the April announcment that
it would default on its debt. The Company, at that time, said it
was analyzing its liquidity options, as well as its sources of
financing and operations.

At the end of 2001, the cement maker's debt stood at US$430
million, nearly 40% of which has been converted to pesos, while
debts owed to foreign banks accounted for 60%.

CONTACT:  LOMA NEGRA
          Bouchard 680 (1106)
          Federal capital
          Argentina
          Phone: (54-11) 4319-3000
          E-mail: loma.internet@lomanegra.com.ar
          Home Page: http://www.lomanegra.com.ar
          Contact:
          Alejandro Bengolea, Managing Director

          MORGAN STANLEY, DEAN WITTER & COMPANY
          1585 Broadway
          New York, New York 10036
          United States
          Phone: +1 212 761-4000
          Home Page http://www.msdw.com


REPSOL YPF: Increases Net Profit By 4.6% To Over EUR1.3B
--------------------------------------------------------

- Net financial debt is cut by almost EUR7.6 billion (46%)
- Cash flow surpasses EUR2.4 billion
- Total production reaches nearly one million barrels per day
(7.6% up on equal terms)

In the first half 2002, Repsol YPF reported net income was
EUR1,302 million, showing a year-on-year rise of 4.6% against the
first half 2001, accompanied by a drastic reduction in company
debt, which at June 30th last was EUR8,960 million, in comparison
to EUR20,406 million at the close of the first half 2001.

Net cash flow for the half year reached EUR2,421 million, showing
a year-on-year drop of 21.9%, and operating income was EUR1,733
million, of which 48% was obtained in Spain and 35% in Argentina.

This results were especially significant considering the adverse
international scenario and the situation in Argentina.  Oil
prices, despite a rise towards the end of the period, were much
lower than in the first half 2001 and international refining
margins were at their lowest for the past ten years.  Among the
most favorable aspects, we would like to point out the turnaround
registered in the chemical business area since April last, which
has made it possible to end this half with positive income
figures.  In addition, gas and power continued to show income
growth in Spain.

In Argentina, performance was globally affected by the economic
crisis in that country and the measures affecting the oil sector
initially set in place by the Argentine government.  However, it
should be noted that, after the first months of uncertainty, on
14 June last, a series of measures was passed which may be
considered positive, and which indicate a return to Argentina's
traditional position in the oil sector of non intervention and
price freedom.

The measures adopted with a direct impact on Repsol YPF business
performance include: maintenance of the free circulation in the
exterior of 70% of currency from exports; continued price freedom
on the domestic market for oil products, with the commitment not
to raise retail prices for these products above MERCOSUR levels;
freedom in the exporting of crude oil and oil products; and the
gradual elimination or reduction of taxes applied to oil product
exports (the elimination of the tax on naphtha, which went from
5% to 0%, and the cutting of import tax on LPG from 20% to 5%).
The Argentine government is shortly expected to continue to adopt
the necessary measures to set all the agreements in place.

As a result of the economic crisis in Argentina and the peso
devaluation, for which an exchange rate of 3.75 pesos to the
dollar has been applied, the company allotted a series of
provisions and write-offs in addition to those made last year
against the first half 2002 results, and as foreign currency
translation adjustments.  Consequently, a provision of EUR238
million was allotted against financial results, and of EUR103
million against unconsolidated affiliates to compensate for
exchange rate differences produced by the debt in dollars that
finances assets in Argentina denominated in pesos.  An additional
adjustment of EUR1,165 million was made against the consolidated
balance sheet.  In all, since the beginning of the Argentine
crisis at the end of 2001, Repsol YPF has made adjustments
against the Consolidated Balance Sheet amounting to EUR2,615
million.  After these adjustments, only 27% of the original value
of assets originally denominated in pesos, which amounted to
3,571 million pesos, remains to be covered.

Investments in this first half 2002 were EUR1,322 million,
showing a 38% fall in comparison to the first half of 2001, and
in line with the contention policy announced for 2002.
Investments of the exploration and production business area
amounted to EUR504 million for the development of fields.  A
similar amount, EUR490 million, was invested in the gas & power
area, which, in the midst of a strong investment effort, only
reduced its investments by 13.7%.  In this area, investments were
devoted to projects for the integration of the gas and power
chain, and for raising the company's participation in gas
distribution companies in Brazil and Colombia.  Of the remaining
investments, EUR217 million were spent on the refining and
marketing business area, mainly to up-grade the middle distillate
production units (catalytic hydrocracking) and improve the
service station network.

Divestments amounted to EUR2,698 million for the half year.  On
16 May last, the sale of a 23% stake in Gas Natural SDG, with a
divestment of EUR2,008 million, was announced.  As a result of
the sale by Gas Natural SDG of a 65% stake in Enagas, the Company
divested an additional EUR221 million, and an 18.55% stake in CLH
was sold to the Canadian company Enbridge, a 3.71% stake to Disa
and a 13.25% stake in Gas Natural Mexico to Iberdrola.

Net financial debt fell considerably, reaching EUR8,960 million
at the end of this half, thus achieving a reduction of EUR7,600
million in the first six months of 2002.  This debt reduction was
mainly the result of a high net cash flow generated over the
period, the moderation of the investment schedule, the
divestments carried out, changes in consolidation parameters
(mainly Gas Natural and Enagas), and the depreciation of the
dollar against the euro.  As a result of the above, the Repsol
YPF net debt to capitalization ratio dropped to 32.8% as against
47.2% at the end of the first half 2001, enabling the Company to
reach the objective it had fixed for the year 2005 ahead of time.

By areas of activity, these are the highlights for the first half
of 2002:

In Exploration & Production, operating income was EUR691 million,
showing a 55% drop against the first half of 2001.  This fall was
mainly caused by lower benchmark oil prices, and by the
exceptional circumstances in Argentina.  The average price of
Brent oil was $23.1 per barrel, as against $26.6 per barrel in
first half 2001.  The Repsol YPF crude realization price averaged
$18.4 per barrel, in comparison to $24.2 per barrel in the first
half 2001.  The increase in the differential regarding reference
crude had three main causes: firstly, a 20% tax applied by the
Argentine government on crude oil exports from that country;
secondly, the decision by Argentine oil producers to apply a
discount on the international price in their sales to the
refining sector (which has varied between some 20% in the early
months of the year and 10% as of the month of May); and, thirdly,
the larger percentage of heavy crude in the Repsol YPF basket
following the sale of assets in Indonesia.

Average gas prices over the quarter were 50% lower than the 2001
equivalent.  Gas tariffs in Argentina are basically still in
pesos, that is, prices are still frozen in pesos, without having
undergone any adjustment whatsoever following devaluation, with
the exception of exports.

In spite of this difficult scenario, the Company has continued to
fulfill its strategic objective to increase its oil and gas
production, principally that of natural gas.  Overall production
during the half year was 992,000 boepd, of which 585,000 are
liquids and the remainder are natural gas.  This figure is 0.5%
up on the year earlier level.  These figures are even more
significant, if we consider that they do not include the
production from some of the assets in Indonesia, which were
included in last year's production (65,000 boepd).  On equivalent
terms, for asset participations in 2001, total average daily
production in the first half 2002 was 7.6% higher than a year
earlier, with higher production increases obtained in Venezuela
(Quiriquire) and Bolivia.

The company made important discoveries in the first half, the
largest of which were in the Murzuk Basin, Libya, the Red Mango 2
well in Trinidad & Tobago, and in Argentina, in the basin of the
San Jorge Gulf, at the Greenbek x-610 well in the Manantiales
Behr area, Estancia Sara¡ Oeste x-1 in the Los Perales-Las
Mesetas area, and Rinc¢n Chico xp-101 and Cerro Negro x-1 wells
in the Neuqu‚n Basin.

Operating income from the Refining & Marketing area was 43.3%
down on the equivalent figure the year before, at EUR469
million.  Performance this quarter showed the effect of 73% lower
international refining margins than in the first half 2001, and
the weak economic situation in Argentina.  Marketing margins
remained at normal levels, as did LPG margins thanks to the
revision of marketing costs in the system for setting bottled LPG
price ceilings, and the price evolution.

In Spain, overall Repsol YPF year-on-year sales rose 9.4%, due to
higher fuel oil sales.  Gasoline and gas-oil sales to our own
network fell 2.7% because of lower demand for gasoline on the
domestic market and a reduction in gas oil sales through low
margin channels.  In Argentina, these sales dropped 2.8%, mostly
with respect to gasoline due to a fall in demand.

LPG sales in Europe remained stable with respect to the first
half 2001, thanks to favorable temperatures, and despite
competition from natural gas and power.  Sales in Latin America
posted a year-on-year growth of 6.6%.

In this half, there was an operating income of EUR49 million in
Chemicals, compared to EUR8 million in the equivalent period
2001.  The year-on-year rise in income was mainly the result of
higher international margins and sales.  Derivative chemicals
performed much better, with a 10% sales growth and wider margins
for some products on international markets, especially in the
case of styrene and aromatics.  These factors, boosted by a
favorable sales mix, more than compensated for lower income from
base chemicals.  These results benefited from higher
competitiveness of our production in Argentina, thanks to the
effect on costs of devaluation.

Overall sales of petrochemical products were 1,791 thousand tons,
showing a rise of 8% in comparison to 2001.  This sales growth
was mainly the result of consolidating production from the PO/SM
plant in Tarragona, and the urea plant in Bah¡a Blanca
(Profertil).

In Natural Gas & Power, operating income registered an 8.7% fall
against the first half of 2001, falling to EUR526 million in 2002
from EUR576 million the year before.  This was caused by the
proportional consolidation of the 24% stake in Gas Natural since
the end of May, and adverse conditions in Argentina.

First half sales from Repsol YPF natural gas activity totalled
215,535 GWh, and were 19.7% higher than in the first half 2001,
as a result of higher sales to Spanish thermal plants,
transmission and third-party access sales, and higher income from
operations in Mexico, Colombia and Brazil.

As for the sale of electricity, the company held an approximately
4% share of the liberalized power market, having obtained 418
contracts since it began selling electricity on the Spanish
market at the end of 2000.  The customers with whom it holds
contracts currently consume an annualized 272 GWh, and sales in
this first half 2002 reached 1,114 GWh.

To see financial statements: http://bankrupt.com/misc/Repsol.pdf

CONTACTS:  REPSOL YPF
           Alfonso Cortina De Alcocer, Chairman & CEO
           Ramon Blanco Balin, Vice Chairman
           Carmelo De Las Morenas Lopez, CFO

           Their Address:
           Paseo de la Castellana 278
           28046 Madrid, Spain
           Phone   +34 91 348 81 00
           Home Page: http://www.repsol.com
           or
           Av. Roque S enz Pe a, 777.
           C.P 1364. Buenos Aires
           Argentina



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

GLOBAL CROSSING: John Legere Testifies Before US Congress
---------------------------------------------------------

Chairman Hollings and members of the Committee, thank you for
inviting us here today to discuss the state of the
telecommunications industry. We want to commend you and this
Committee for holding a hearing on the critical issue of how the
industry's financial health can be restored. This hearing will
make a significant contribution to the continuing public dialogue
on how we can ensure that the communications infrastructure on
which the American people have come to rely is not compromised
while the industry makes its way through a period of transition.
By holding this hearing, you are sending a positive signal to the
financial markets and to the public that Congress is confident
that our Nation's telecommunications companies will weather the
financial turbulence that we face and that government and the
private sector can work together to address the issues in a
cooperative and constructive manner.

Despite the much-publicized economic problems of the
telecommunications sector, we should not lose sight of the fact
that our country has the world's most sophisticated and advanced
communications infrastructure and services. Propelled by our
enterprising culture and funded by private capital, America's
communications companies have created networks that are
unparalleled anywhere in the world -- networks that are critical
to maintaining our Nation's security and our leadership in the
world economy. Every day, Americans are able to reap the
substantial benefits of innovation, efficiency and competition
that are the product of these investments.

Global Crossing and its thousands of employees are proud
participants in this competitive market. We have completed a
global fiber optic network that spans 101,000 route miles. We
provide some of the world's most advanced telecommunications
services to tens of thousands of customers, both in the United
States and abroad. For our company, for our employees and, most
of all, for every one of our customers, which include many of the
largest telecommunications carriers in the world, we ask that
this Committee and the Congress do what they can to ensure that
competition in the telecommunications industry remains healthy.
Ensuring that the industry remains strong and competitive is
vital to delivering the innovation and cost efficiencies on which
the global economy depends.

We are here today because America's telecommunications industry
is threatened by a financial crisis of enormous and unexpected
proportions. I hope to share some observations on the sources of
this crisis and on how the industry can best survive it. Global
Crossing believes that government can play an important role in
helping those segments of the communications industry that are in
a state of turmoil to recover. Today's hearing is part of our
collective opportunity to restore confidence and rebuild the
industry.

Given the expressed interests and responsibilities of this
Committee, today I intend to address the following: (i) the
formation and growth of Global Crossing; (ii) the profound
changes in the telecommunications industry, which began in mid-
2001, and have brought us to where we are today; (iii) the status
of the various governmental inquiries into Global Crossing; (iv)
Global Crossing's performance since it filed for bankruptcy on
January 28 of this year; and (v) our vision for the future.

I believe that the industry-wide crisis we are experiencing is a
product of the interplay among the overall business environment,
changing patterns in the supply and demand for network capacity,
marketplace perceptions, access to capital and the regulatory
environment. These are among the principal industry-wide factors
that have caused not only Global Crossing, but also many other
companies, to declare bankruptcy within the past 15 months. The
pandemic nature of the problem we are facing is demonstrated all-
too-clearly by the broad range of telecommunications companies
that are now in bankruptcy: they are U.S.-based, as well as
international; they own subsea cables, as well as terrestrial
systems; they provide long distance services, as well as local
access; and they are built on wireless, as well as wireline,
technologies.

It is important to emphasize that despite the popular perception
that this industry's problems stem from alleged accounting
irregularities at a handful of companies, the turmoil we are
experiencing is far more complex and more fundamental than the
media have led many to believe. Allegations of accounting
irregularities properly need to be addressed and may play larger
or smaller roles in the difficulties faced by particular
companies. Only by understanding the fundamental business factors
underlying today's crisis, however, can we all work together to
restore the strength of this vital sector.

Formation and Growth of Global Crossing
Global Crossing was created by visionaries who saw an unmet need
in the marketplace for an integrated global high-capacity, fiber-
optic network under common control. Throughout the history of the
telecommunications industry, international traffic had been
handed off, from one national carrier to another. As the world
entered the age of the Internet, some saw that these legacy
networks had neither the capacity nor the functionality to
provide adequately for the envisioned Internet-based services.
The vision of the founders of Global Crossing was to facilitate,
in a more cost-effective manner, the worldwide transport of the
surging traffic flows stimulated by the emergence of the
Internet.

Global Crossing was launched in 1997 and became a publicly traded
company in 1998. The founders of the Company successfully raised
substantial amounts of private capital, capital that was
essential to Global Crossing's ability to compete with the huge
incumbent players (such as, AT&T) and to the construction of a
new fiber-optic network that reached most of the world. Based on
the widespread belief in multiple independent forecasts of rapid
growth in demand for data services, the capital markets supported
the project and construction was completed in record time.

Today, as a result of these efforts, Global Crossing has 101,000
route miles of fiber worldwide, fully operational in 220 cities
in 27 countries. In addition, the Company has built a large and
loyal customer base of public and private entities of all sizes.
Our customers range from Kay Bee Toy Stores, with hundreds of
stores worldwide, to the British Foreign Commonwealth Office,
with over 240 embassies around the globe. Just last week, we
announced that we are now linking research telescopes around
Europe over our fiber-optic network, allowing research
institutions worldwide to advance the science of astronomy. We
connect thousands of financial institutions, completing millions
of transactions every day over our network.

Our backbone network makes it possible for Americans to phone
their relatives and friends in Europe, Asia, Latin America and
Australia for dramatically lower costs because those calls can be
transmitted over our fiber-optic backbone. And, our network is an
important backbone for the Internet, enabling people and
businesses to communicate in ways we simply could not have
imagined just a decade ago. Despite our Chapter 11 filing and the
substantial cost restructuring that we have undertaken, the size
and reliability of our network continues to attract some of the
world's most important companies, financial institutions, and
governments as customers. As a major supplier of wholesale
capacity and services, our network supports nearly every major
carrier in the world.

As our operations have continued without interruption, even as we
proceed with our Chapter 11 reorganization, we are fortunate to
have lost very few of our customers. We are enormously grateful
for the loyalty of the thousands of customers who have understood
that the value of Global Crossing's services was not diminished
simply because we had to restructure our finances. That new
customers are willing to trust us with their critical
communications needs validates the vision of Global Crossing's
founders and gives us confidence for the future. Our experience
suggests that continuing to focus on customers and service is
essential if the industry is to emerge from the current crisis
with renewed vigor.

Although we are a global concern, the vast majority of our
customers and most of our employees reside in the United States.
Our corporate headquarters are in the United States and we have
network operations centers here. Global Crossing is an integral
part of the Nation's vital communications infrastructure, and we
are doing everything we can to keep it that way. Our future as a
company depends on it.

Changes in the Telecommunications Industry
The Committee has asked how we got to where we are today. To
answer that question, we need to take ourselves back to how the
telecommunications world looked just a few short years ago, when
optimism - and demand forecasts - appeared nearly unbounded.
Throughout the late 1990s and well into 2001, the
telecommunications industry and those in the financial world who
analyzed the industry foresaw an unending appetite for additional
bandwidth capacity. Growth of Internet usage was astonishing,
posting gains of several hundred percent a year, increases that
were forecast to continue for some time, both in the United
States and around the world. Enterprise customers were moving
toward feature-rich, IP (Internet Protocol)-based networks of
just the sort that we have built at Global Crossing. Many
observers foresaw a world in which graphics, music and movies,
with other gigabit-rich content, would flow directly to the home,
and where new applications - games, virtual reality, distributed
computing - would consume huge quantities of bandwidth.

In part, these expectations relied significantly on overcoming
the last hurdle in the telecommunications world: the last mile.
High-bandwidth intercity and international networks were
constructed to facilitate commerce and satisfy consumer demand.
Consumers and businesses, we all thought, would embrace broadband
applications. But, those applications depend on making sure that
broadband networks go right to the home and office. And, although
Global Crossing serves few individual consumers, we are an
important supplier of network facilities and services to other
telecommunications providers and businesses who count individuals
among their retail customers.

Even leaving aside the slow deployment and take up of broadband
to the home, today there remain significant constraints on local
access for thousands of businesses. This is particularly so for
those outside the main metro areas. For new telecommunications
competitors, who want to satisfy that demand, the costs of local
access are still high, given the current structure of the
industry.

Global Crossing and other next-generation telecommunications
companies relied on forecasts of explosive demand for bandwidth,
forecasts that were based on expectations of new applications and
on hopes of addressing and resolving the issues of access and
cost of local infrastructure. We built out our networks to meet
this expected demand. Creating bandwidth, whether across oceans
or land, is not instantaneous. Due to the long lead times
necessary to plan, finance and construct new facilities,
companies such as ours always have to build ahead of actual
demand, which requires that our planning for new facilities looks
ahead for several years. With actual and projected growth rates
for capacity that approached 100% annually, it is clear that
planning ahead for even one year implied the need to build
massive amounts of capacity ahead of actual demand. For these
reasons, we always have more capacity than we would need to serve
our present customers. In short, at any point in time and in any
one market, supply may well, and quite appropriately, exceed the
existing demand.

For this reason, Global Crossing, like other large
telecommunications companies, understood that, as new capacity
came on-line, there might well be a temporary excess of the
supply of capacity over demand in some markets and for a limited
period of time. Multiple independent studies undertaken at the
time, however, suggested that demand would continue to increase
at very high rates and that any temporary oversupply would be
extremely short-lived. The reports of experienced industry
analysts indicated that any overcapacity would be swallowed up
within a year or two in all geographic areas. Multiple industry
experts and analysts predicted that the temporary oversupply in
trans-Atlantic capacity would be consumed by 2003, and in trans-
Pacific capacity by 2004. These same studies suggested that even
after this supply had been exhausted, demand would continue to
grow by leaps and bounds for years to come.

What happened in the middle of 2001, however, is that our
customers increasingly perceived that there was an oversupply of
capacity. In fact, competing systems were built, while many more
were announced, but never built. Carrier and enterprise customers
decided to wait out the market because they thought that if they
held off on making purchases, they could negotiate a better deal
from telecommunications providers. In addition, deployment of
broadband across the last mile was turning out to be slower than
had been forecast by industry experts. For these reasons, demand
for our network and services did not increase as much as we had
planned, in significant measure because our carrier customers did
not continue to buy capacity to serve their retail users.

At the same time, and partly as a consequence of the perception
of a supply glut, prices dropped more rapidly than had been
expected in many of the major markets that we serve. Our industry
had been accustomed, of course, to price declines that were
driven by advances in technology that were even more rapid than
those experienced in the computer industry in recent decades. In
the market for broadband telecommunications capacity, the
declines in prices had been more than offset by the exploding
demand for more capacity, leading to growing revenues. By the end
of 2001, however, while price declines had continued to exceed
forecasts and expectations, the demand for capacity had slowed.

In addition to the slower-than-expected rollout of broadband
applications, the broader economic crunch hit our industry, and
hit it hard. The economy slowed down in the United States and
worldwide, and our service revenues did not grow as rapidly as we
had predicted. The capital markets, which had previously enabled,
even encouraged, the existence of many emerging
telecommunications and Internet companies who were large
purchasers of bandwidth, closed down for these companies. Even
the large incumbent telecommunications carriers, who were large
customers of ours, had financial challenges of their own, whether
from the economic slowdown, increased competition, the demands of
improving their own networks or acquisitions of 3G wireless
licenses at auction in Europe.

We were not the only telecommunications company to get caught in
this "perfect storm" of slowing growth in demand, declining
prices, a perceived glut and an economic and financial downturn.
We had incurred over $8 billion in debt in order to construct and
operate our global network and, as the year progressed, we
realized that it would be increasingly difficult to meet the
requirements of that debt.

Early in the fourth quarter of 2001, I was asked to serve as
Global Crossing's CEO. My leadership team and I quickly undertook
the further steps that were needed to streamline the company's
operations. We eliminated layers of management, implemented
dramatic cost reductions, including a reduction in force from
nearly 14,000 to 5,000 employees, and redesigned the company's
business and financial models. Despite these necessary and
painful measures, it became apparent that our debt service,
coupled with a realistic assessment of the market opportunities
in the context of a continued slow-down in the economy, required
Global Crossing to explore all its options.

Towards the end of the year, we accelerated discussions with
banks and potential investors. As the pressure of loan
obligations increased, however, our advisors counseled us that
the Company's situation called for measures more drastic than
originally expected, and, with great regret, we filed for
bankruptcy protection on January 28 of this year.

We were neither the first nor the last telecommunications company
to seek bankruptcy protection. As The Wall Street Journal
reported in early 2001, telecommunications companies had borrowed
more than $1.5 trillion from banks since 1996 and issued over
$600 billion in bonds in order to invest in their networks. Given
these debt loads, many telecommunications enterprises were forced
to cut back their operations and, in the case of some, file for
bankruptcy. Inevitably and unfortunately, many people who were
employed by them, and many others who invested in these
companies, personally experienced the ensuing turmoil.

Government Inquiries
The media continue quite naturally to highlight allegations of
accounting irregularities and the role that they may have played
in bringing about the current crisis. Each of us sitting at this
table is reportedly the subject of government inquiries into
various accounting practices. With respect to Global Crossing,
the media have reported that the government is examining issues
related to the accounting methods or procedures our company used
for sales and purchases of capacity in the form of Indefeasible
Rights of Use, or IRUs, in connection with concurrent
transactions with our carrier customers.

I do not believe that the way in which Global Crossing accounted
for specific transactions played any role in our financial
troubles. The sale and acquisition of capacity via contracts
known as IRUs is an essential part of creating efficient
networks. Transactions involving IRUs are legitimate and
important to both buyers and sellers of capacity and have been
used for many years in the industry. Accounting for the
concurrent transactions raised several very complex issues; in
fact, we spent a great deal of time working with our independent
auditors to determine how to account for them appropriately.

It is far too simplistic to assert that the widespread problems
in the telecommunications industry were caused by particular
methods of accounting. Whether other companies' difficulties are
accounting-related, we cannot say. At Global Crossing, however,
we know that the transactions in question represented a
relatively small portion of our business, and that our accounting
for them does not explain why we found it necessary to seek
bankruptcy protection.

We are, of course, cooperating fully with the investigations by
government bodies into our accounting practices. We have provided
documents and testimony to the SEC regarding the subject
transactions and precisely how we accounted for them. We have
also made our employees available to be interviewed by the staff
of the Energy & Commerce Committee of the House of
Representatives, and in March I testified before the Subcommittee
on Oversight and Investigations of the Financial Services
Committee of the House of Representatives. For our own part,
Global Crossing's Board of Directors has appointed a special
committee of independent directors, which is conducting a review
of the Company's accounting practices for the concurrent
transactions.

Post-Bankruptcy Events at Global Crossing
I believe there are important lessons to be learned from our
experience at Global Crossing as we look forward. Our network is
still fully operational. We have thousands of dedicated and loyal
employees who have maintained uninterrupted service across our
network since our bankruptcy filing. We have substantially cut
our capital and operating expenditures, and we have met all of
our operational goals.

Delivering top quality service is still our highest goal. We
continue to meet the national and worldwide needs of our tens of
thousands of customers. The fact of our bankruptcy has not
disrupted or affected a single customer. It is our hope that the
steps we have taken will allow Global Crossing to continue to
compete as an ongoing business. We are aggressively pursuing
plans to emerge from Chapter 11 with our network intact.

Our financial performance since filing for Chapter 11 protection
has met or exceeded our expectations. We are winning new
customers and retaining our existing customers at rates higher
than we had forecast. We continue to achieve an availability rate
of 99.999% on our IP network, a level of performance that matches
the best in the industry. Since we filed for Chapter 11
protection, our revenue, earnings, and cash have all exceeded the
expectations that we established with our creditors. At the same
time, our monthly operating expenses are now 40% lower than they
were at the end of last year. IP traffic across our network shows
healthy growth in light of the current environment.

What does the future hold for Global Crossing? It is hard to say,
because we are in the middle of a complex restructuring process
governed by the bankruptcy law. The future ownership of the
company is being determined by the confidential auction that is
now proceeding, and we expect to present the results of that
auction to the Bankruptcy Court next week. Although our future is
not entirely certain, we believe that we will emerge from this
process with our network intact, and with new, more efficient
ways of running our business.

Before I conclude, let me add some thoughts on the role of
government in restoring financial health to the
telecommunications sector.

Although some have argued that, in a time of turmoil, it may be
appropriate for government to intervene in the market, to apply a
heavier regulatory hand to the telecommunications industry, we
believe that the FCC should stay on course in instituting
measures that ensure fair competition and a level playing field
between incumbents and new competitors. We believe the FCC,
supported by the Congress, can continue to play an important
role, working with industry and Wall Street, to assist the
industry in transitioning out of our financial crisis.

We urge the Committee, along with the rest of Congress, the
Administration and the FCC, to do what they can to open up the
remaining telecommunications bottleneck in the local market,
including through enforcement and monitoring of the obligations
of Section 271 of the Communications Act. With respect to the
local market, it is essential to do what is needed to promote
competition and, most importantly, to bring down the prices of
local access so that the promise of broadband can be realized. In
addition, Congress has an opportunity to legislate on the issue
of the fees charged for public rights of ways and for access to
buildings. Adopting nondiscriminatory policies and ensuring that
fees are reasonable, to allow fairer access to public rights of
way, will help stimulate demand, promote consumer choice and lay
the foundation for a healthier industry.

We believe that this industry will, one way or another, come
through this difficult period. We cannot be sure how long the
crisis will last. At Global Crossing, we started down the path of
restructuring nearly a year ago. We have demonstrated that a
turn-around is possible where management implements a focused and
pragmatic plan, including often painful, but necessary, cost-
reductions. This week, we expect that the competitive bidders who
have come forward with proposals to invest in Global Crossing
will make their final offers. And, early next year, we expect to
emerge from the Chapter 11 process. When we do, we fully intend
to continue serving our customers, just as we remain confident in
our founding vision, of a global, seamless fiber-based IP
network.

Mr. Chairman and members of the Committee, the current financial
turmoil need not have a permanent effect on our world-leading
telecommunications industry. With the cooperation of our industry
partners, the financial markets, the Congress, the Administration
and the FCC, we can restore the confidence of the American people
and the world. During the last decade, our country has undergone
a communications revolution that has produced substantial social
and economic benefits. We believe that the industry will recover
from its current financial crisis and that it will continue as an
integral part of the engine for economic growth. On behalf of the
thousands of Global Crossing employees and our customers, let me
reaffirm that we very much expect to be part of that recovery and
resurgence.

Thank you, once again, for inviting us to testify.

ABOUT GLOBAL CROSSING
Global Crossing provides telecommunications solutions over the
world's first integrated global IP-based network, which reaches
27 countries and more than 200 major cities around the globe.
Global Crossing serves many of the world's largest corporations,
providing a full range of managed data and voice products and
services. Global Crossing operates throughout the Americas and
Europe, and provides services in Asia through its subsidiary,
Asia Global Crossing.

On January 28, 2002, Global Crossing and certain of its
affiliates (excluding Asia Global Crossing and its subsidiaries)
commenced Chapter 11 cases in the United States Bankruptcy Court
for the Southern District of New York and coordinated proceedings
in the Supreme Court of Bermuda. On the same date, the Bermuda
Court granted an order appointing joint provisional liquidators
with the power to oversee the continuation and reorganization of
the Bermuda-incorporated companies' businesses under the control
of their boards of directors and under the supervision of the
U.S. Bankruptcy Court and the Supreme Court of Bermuda. On April
23, 2002, Global Crossing commenced a Chapter 11 case in the
United States Bankruptcy Court for the Southern District of New
York for its affiliate, GT UK, Ltd. Global Crossing does not
expect that any plan of reorganization, if and when approved by
the Bankruptcy Court, would include a capital structure in which
existing common or preferred equity would retain any value.

CONTACT:

GLOBAL CROSSING (Press Contacts)
Becky Yeamans
+ 1 973-410-5857
Rebecca.Yeamans@globalcrossing.com

Tisha Kresler
+ 1 973-410-8666
Tisha.Kresler@globalcrossing.com
Analysts/Investors Contact
Ken Simril
+ 1 310-385-3838
investors@globalcrossing.com


GLOBAL CROSSING: Ex-COO Expected To Bid For Assets
--------------------------------------------------
Global Crossing's former chief operating officer and sales
director is seen likely to join the bidding for the assets of the
telecommunications company, The Wall Street Journal reported,
citing people close to the bidding process.

The conclusion was made after David Walsh was observed visiting
and looking over the Company's assets and operating plans at
Global Crossing's Madison, New Jersey offices. However, Mr. Walsh
did not give comments on the speculati.

Mr. Walsh was head of Global Crossing's sales department for the
majority of 2001. With the filing of Chapter 11 bankruptcy
protection of Global Crossing, Mr. Walsh has also been subject to
SEC investigations for the sales of 672,000 shares of Global
Crossing stock in May 2001. The sale, according to reports,
brought him profits of $8.67 million.

Global Crossing, which posted debts of more than US$12 billion in
its filing, made no comment on Mr. Walsh's previous affairs with
the company.  It also did not reveal details of the auction
process which is slated Wednesday.

Mr. Walsh is the chairman of Moneyline Telerate, which is backed
by One Equity Partners, the $3.5 billion private-equity arm of
Bank One Corp.



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

BCP: To Default On $14.5M Debt Coming Due Aug 1
-----------------------------------------------
Bellsouth Corp.'s Brazilian wireless phone unit BCP
Telecommunicacoes SA will suspend payment of BRL46 million
(US$14.5 million) in interest due Thursday, pending approval of
its creditors.

The Company's creditors led by ABN Amro Holding NV, which
represents 34 creditors of the firm, assumed control of the
Company's cash management after the mobile phone firm defaulted
payment on debt in April. BCP defaulted on US$375 million payment
out of the US$1.6 billion total debt.

In a joint statement with BCP, the Dutch bank said it is going to
monitor current financial operations of over US$100,000 capital
and operating expenditure of over US$500,000.

According to analysts, the Company's trouble is not really in its
operations but on its debt that has been inflated due to
adjustments brought by currency devaluations.

BCP is Brazil's fifth-largest wireless operator, servicing the
metropolitan region of Sao Paulo, the country's largest city and
financial hub. BellSouth and Brazil's Safra Group each own 44.5%
in BCP. Newspaper holding company Grupo Oesp owns 6%, Splice do
Brasil 2.8 percent and BSB Participacoes 2.2%.

CONTACT:  BCP TELECOMUNICACOES
          Address: Rua Fl¢rida, 1970 4o andar
          Sao Paulo - SP
          Tel: 55 11 5509-6428
          Fax: 55 11 5509-6257
          Home Page: http://www.bcp.com.br

          ABN AMRO HOLDING N.V
          Foppingadreef 22
          1102 BS Amsterdam, The Netherlands
          Phone: +31-20-628-9393
          Fax: +31-20-629-9111
          Home Page: http://www.abnamro.com
          Contact:
          Investor Relations(HQ1191)
          Gustav Mahlerlaan 10
          PO Box 283
          1000 EA Amsterdam
          The Netherlands
          Phone: +31 (0) 20 628 78 35
                 +31 (0) 20 628 78 37
          E-mail: investorrelations@nl.abnamro.com


JERONIMO MARTINS: Brazil Blocks Sale Of Se To Pao de Acucar
-----------------------------------------------------------
The sale of Jeronimo Martins SGPS SA's Brazilian supermarket
chain Se to Cia. Brasileira de Distribuicao Grupo Pao de Acucar,
the country's largest food retailer, is likely to suffer a
setback.

Citing Claudio Considera, an economist at the ministry, O Estado
de S. Paulo daily newspaper reports that Brazil's Finance
Ministry sent a request to the country's antitrust agency to
suspend the transaction on concern that it would increase Pao de
Acucar's market concentration in at least seven cities in Sao
Paulo state.

The suspension is aimed at preventing Pao de Acucar and Se from
changing their distribution and supplier network until the
government issues its final ruling on the acquisition.

On July 1, Jeronimo Martins, Portugal's No. 2 retailer, agreed to
sell Se to Pao de Acucar for BRL400 million (US$126 million) in
cash and debt. Jeronimo Martins is selling assets as part of an
effort to reduce debt, which soared after expansion in Brazil and
Poland. The sale will bring to EUR354 million the amount Jeronimo
has raised in the past year from asset sales, reducing debt to
less than EUR1 billion from more than EUR1.4 billion a year ago.


NET SERVICOS: Shareholders Agree to BRL1B Recapitalization
----------------------------------------------------------
The majority of Net Servi‡os de Comunica‡ao S.A. (the "Company")
shareholders of have agreed to effect a recapitalization of
approximately BRL1 billion to increase the Company's equity
capital and to reduce its debt. The proposed recapitalization
includes a proposed Brazilian offering of common and preferred
shares.

Except as otherwise noted, amounts set out in U.S. dollars in
this section that have been translated from reais have been
translated at the exchange rate in effect on March 31, 2002 of
BRL2.3236=US$1.00. As of July 17, 2002, the rate of exchange was
BRL2.896=US$1.00.

The various commitments of the Company's major shareholders
participating in the Proposed Recapitalization and that of Banco
BBA Creditanstalt S.A. in a minimum amount of BRL1 billion are
listed in the table (click link below to see table) with U.S.
dollar equivalents. The Proposed Recapitalization is being
effected pursuant to an agreement called the Protocol of
Recapitalization of Net Servi‡os, which was signed on April 10,
2002, and subsequently amended on April 30, 2002 and June 14,
2002, among the Company and the Company's major shareholders.
Before deducting expenses, the Company expects that the purchase
by BNDES Participa‡oes S.A. ("Bndespar") and RBS Participa‡oes
S.A. ("RBS") of common and preferred shares in the Proposed
Recapitalization would provide the Company with gross cash
proceeds of approximately BRL175.7 million.

* See Summary of the Proposed Recapitalization

To see financial statements:
http://bankrupt.com/misc/globo_cabo.pdf

CONTACT:  NET SERVICOS DE COMUNICACAO S.A.
          CNPJ/MF n  00.108.786/0001-65
          NIRE n  35.300.177.240
          Companhia Aberta
          Rua Verbo Divino n  1.356 - 1 a, Sao Paulo-SP
          Contact:
          Leonardo P. Gomes Pereira
          Investor Relations and Chief Financial Officer
          URL: http://globocabo.globo.com/


VARIG/VASP: Government Assistance to Rescue Troubled Airlines
-------------------------------------------------------------
The Brazilian government is working in cooperation with the
country's airlines, such as TAM, Varig and Vasp, to work on a
solution to the industry's crisis.

According to a report by Gazeta Mercantil, the government and the
airline companies are now negotiating on issues, such as the
reduction of taxes as the IOF (Imposto sobre Opearcoes
Financeiras), charged over insurance and leasing operations and
taxes over imports.

The insurance companies raised the sum to be paid for the
terrorism and kidnapping insurance from US$50 million to US$150
million as of September 11. The Brazilian government assumed the
risk of between US$150 million and US$1 billion in case of losses
caused to outsiders due to terrorist attacks.

According to market sources, the Brazilian government now
considers taking the total risk and the companies would not have
to acquire terrorism insurance anymore.

Varig is yet to post a profit since the country's domestic air
travel market was opened to competition in the early 1990s and
after a currency devaluation in 1999. The company is embarking on
a BRL1-billion, part of which is the issuance of BRL56 million
worth of debentures, which will be backed up by the carrier's
income from ticket sales. The amount will be deposited in the
company's account in BankBoston. Varig is also currently
negotiating with BNDES (Banco Nacional de Desenvolvimento
Economico e Social) the other debentures issuances of BRL300
million.

Vasp is also staggering with a heavy debt load of BRL1.9 billion.

CONTACT:  VARIG (Viacao Aerea Rio-Grandense, S.A.)
          Rua 18 de Novembro No. 800, Sao Joao
          90240-040 Porto Alegre,
          Rio Grande do Sul, Brazil
          Phone: (51) 358-7039/7040
                 (51) 358-7010/7042
          Fax: +55-51-358-7001
          Home Page: www.varig.com.br/english/
          Contacts:
          Dorival Ramos Schultz, EVP Finance and CFO
          E-mail: dorival.schultz@varig.com.br

          Investor Relations:
          Av. Almirante Silvio de Noronha,
          n  365-Bloco "B" - s/458 / Centro
          Rio de Janeiro, Brazil

          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
=========


ENERSIS: Files Letter of Intent with the SEC
--------------------------------------------
(Text of the letter sent Tuesday by Endesa, S.A. to the Spanish
CNMV):

Madrid, 30 July 2002

Dear Sirs,

In relation with the support given by Endesa S. A. to its
subsidiaries Enersis S.A. and Empresa Nacional de Electricidad S.
A. (Endesa de Chile), I hereby inform you of the following:

a) Endesa, S.A. is currently a direct and indirect creditor to
Enersis for an approximate amount of US$ 1,400 million, derived
from the financing of the acquisition of Endesa Chile shares in
1999. With respect to this loan, I hereby confirm that, in order
to strengthen Enersis's financial solvency, it is Endesa. S.A.'s
intention not to demand the repayment of the debt at its maturity
in May 2004, deeming as foreseeable the extension of the credit
for an additional year, or, alternatively, taking initiatives
that allow for its capitalization.

b) Depending on Enersis's cash needs and upon its sole request
the payment of interest on the above loan may be delayed, which
would accrue additional interest.

c) Endesa, in its role of provider of support in situations of
tight liquidity in Enersis or Endesa de Chile and whenever
requested to do so, is ready to acquire, not later than 30 days,
assets from the above companies for an amount of up to US$ 150
million, with the intention to sell them later to a third party,
settling in a mutually agreed form the differences arising from
the above transactions.

The above measures are deemed as being granted in Endesa, S.A.'s
best interest in supporting the solid financial position of
Enersis and Endesa de Chile, and as being geared towards the
contribution to achieving higher liquidity levels in both
companies.

This commitment will be valid until 30th June 2003, and it may be
extended from that date onwards.

Yours sincerely,
Rafael Miranda Robredo, CEO

CONTACT:  ENDESA, S.A., NEW YORK
          North America Investor Relations:
          Jacinto Pariente, 212/750-7200


ENERSIS: S&P Affirms Enersis, Endesa Chile Ratings
--------------------------------------------------
Standard & Poor's Ratings Services said Tuesday it affirmed its
triple-'B'-plus long-term corporate credit and debt ratings on
Chile-based electricity provider Enersis S.A. (Enersis) and its
60%-owned subsidiary, Empresa Nacional de Electricidad S.A.,
(Endesa) Chile (Endesa Chile), after the evaluation of recently
disclosed cross-default clauses with different subsidiaries
present in the companies' debt. The outlooks on both Enersis and
Endesa Chile are negative.

"Although there is concern about regulatory, political, and
economic volatility in most of the countries in which the group
operates, particularly Argentina, Standard & Poor's does not
expect the cross-default clauses to trigger the acceleration of
Enersis' or Endesa Chile's debt in the near future," said Sergio
Fuentes, Infrastructure Finance credit analyst at Standard &
Poor's, Buenos Aires. "The rating affirmation incorporates the
companies' liquidity cushion and expected support from Spanish
parent Endesa S.A. (A/Negative/A-1), which provides comfort about
the companies' ability to manage a potential stressful
situation."

The cross-default clauses could be triggered by different events
at the subsidiaries' level, such as payment defaults, bankruptcy
or reorganization, and certain sovereign-related events, such as
expropriation or nationalization. Except for the filing of
voluntary bankruptcy, none of these clauses imply an automatic
acceleration, which has to be requested by a certain percentage
of creditors under each facility, and the remedy period included
in the documentation would allow the companies to cure or waive
the trigger.

Exposed debt includes $2.1 billion of Yankee bonds and $2.3
billion of bank debt. Standard & Poor's notes that of the group's
two Argentine subsidiaries, Edesur (rated 'SD', selective default
and 65% owned by Enersis) does not have any single debt facility
large enough to potentially trigger the cross-default clauses in
Enersis' Yankee bonds indenture, which requires a default on a
subsidiary debt facility that exceeds $30 million.

Central Costanera (not rated, 51.6% owned by Endesa Chile),
however, does have debt provisions that could trigger cross
defaults with Endesa Chile's Yankee bonds. Both companies have
been severely affected by the Argentine currency devaluation, and
in Edesur's case, by the pesification and freeze of tariffs since
January 2002. Edesur, however, has relatively low debt levels,
and Central Costanera has a partial hedge for the devaluation as
more than 50% of its revenues are U.S. dollar-denominated from
power exported to Brazil. "Although the other events that might
trip the cross-default clause--bankruptcy or
expropriation/nationalization--cannot be ruled out given the
unpredictable nature of Argentina's political and economic
developments, Standard & Poor's expects a low likelihood for
these actions in the short term," added Mr. Fuentes.

The ratings also incorporate rating triggers contained in some of
Enersis' and Endesa Chile's loan facilities, which, in the
unlikely event of significant credit deterioration, could cause
certain loans to accelerate. This concern is somewhat mitigated
by Enersis' and Endesa Chile's strong relationships with their
lenders, which also have strong ties to Endesa S.A., and could
result in renegotiation of the loan terms, as opposed to
acceleration of the debt.


MADECO: Shares Continue Slide On Uncertain Capitalization Result
----------------------------------------------------------------
Shares of Chile's Madeco SA, controlled by Chile's Luksic
business group, fell CLP2, or 5%, to CLP38, reports Bloomberg.
The stock dropped 78% this year on concern that the Company may
not be able to raise enough money from a planned stock sale to
avoid defaulting on its debt.

The Chilean industrial conglomerate Madeco S.A., which has about
US$325 million of debt, plans to issue 1.8 billion new nominal
shares at CLP35 each as part of a CLP63.0-billion capital
increase. Shareholders are yet to be informed of the details of
the issuance in a meeting to be held August 12.

Madeco posted a first-quarter loss of CLP10.22 billion
(US$1=CLP699.40), after the Company closed down part of its
Argentina-based operations in an attempt to minimize further
damage from the country's economic crisis.

To see latest financial statements:
http://bankrupt.com/misc/Madeco.doc

CONTACT:  MADECO S.A.
          Ureta Cox, 930
          San Miguel, Santiago, Chile
          Phone: 56-2 5201461
          Fax: 56-2 5516413
          E-mail: mfl@madeco.cl
          Home Page: http://www.madeco.cl
          Contacts:
          Oscar Ruiz-Tagle Humeres, Chairman
          Albert Cussen Mackenna, Chief Executive Officer

          Investor Relations
          Phone: 56-2 5201380
          Fax:   56-2 5201545
          E-mail: ir@madeco.cl

          SALOMON SMITH BARNEY HOLDINGS INC.
          388 Greenwich St.
          New York, NY 10013
          Phone: 212-816-6000
          Fax: 212-793-9086
          Home Page: http://www.smithbarney.com
          Contact:
          Michael A. Carpenter, Chairman and CEO
          Michael J. Day, EVP and Controller



=============
E C U A D O R
=============

FILANBANCO: Ecuador Banking Board Initiates Liquidation Process
---------------------------------------------------------------
Ecuador's Banking Board has begun liquidating Filanbanco,
formerly Ecuador's biggest bank, whose operations have been
suspended for more than a year.

The move to liquidate Filanbanco, which fell into state hands in
1998 amid a widespread financial crisis and closed its doors last
year due to a lack of liquidity, was finally taken after a series
of failed attempts, as authorities struggled to form three trusts
to handle fixed-asset sales and recover the bank's loan
portfolio, in an attempt to return cash to depositors.

The last of the three trusts, designed to handle Filanbanco's
loans, was formed last week, paving the way to liquidate the bank
before a July 31 deadline.

"A decision has been taken to forcibly liquidate Filanbanco. This
changes the bank's legal status, after it remained under a
suspension of operations for more than a year," Banking Board
president Miguel Davila said.

The government has spent a year researching a way to pay back
US$700 million to bank depositors and still owes clients US$350
million. Authorities hope to return the funds by selling
Filanbanco's fixed assets and recovering some US$1 billion in
loans.

Filanbanco's liquidation is a requirement that Ecuador has to
comply in order for the Andean nation to sign a much-needed
US$240-million International Monetary Fund (IMF) loan deal, which
would open the door to a series of other multilateral credits to
help pay about US$850 million in loan principal this year and
sustain investors' confidence in its economy, which is recovering
from a 1999 crisis.

CONTACT:  FILANBANCO
          Av. 9 of 203 October and Pichincha
          Guayaquil, Ecuador
          Phone: 322780 ext. 2885
          Fax: 329451
          E-mail: mailto:administrador@filanbanco.com
          Home Page: http://www.filanbanco.com/
          Contacts:
          International Business Division
          Germania Narv ez Brandon
          E-mail: mailto:mgnarvaez@filanbanco.com

          Legal Divison (Guayaquil)
          Marks Arteaga Valenzuela, Departmental Manager
          E-mail: mailto:mmarteaga@filanbanco.com



===============
H O N D U R A S
===============

CHIQUITA BRANDS: Reports Improved Second Quarter Results
--------------------------------------------------------
Chiquita Brands International, Inc. reported Tuesday second
quarter 2002 net income of $48 million, or $1.19 per share on
40.0 million new shares. In the second quarter of 2001, Chiquita
had a net loss of $11 million, or a $0.19 loss per share on 73.3
million old shares prior to its financial restructuring in March
2002. The second quarter of 2002 was the company's first quarter
of operations following the restructuring.

The overall improvement in second quarter 2002 generally resulted
from lower interest and depreciation expense due to the company's
financial restructuring, the strengthening of major European
currencies in relation to the U.S. dollar, and the reform of the
European Union banana import regime in 2001, the primary benefit
of which was lower import license costs.

Second quarter 2002 earnings before interest, taxes, depreciation
and amortization (EBITDA) increased 50 percent to $70 million, up
from $47 million in the second quarter of 2001. Second quarter
2002 EBITDA includes a $25 million improvement from the prior
year quarter resulting from the strengthening of major European
currencies against the dollar. The quarter also benefited from
lower import license costs, and higher banana pricing and volume
in Central and Eastern Europe, offset by lower banana pricing in
core European markets and higher production costs. EBITDA before
one-time items for the six months ended June 30, 2002 was $134
million compared to $108 million for the same period a year ago.

Net sales for the second quarter rose 6 percent to $632 million
versus $595 million in last year's second quarter, primarily due
to increased banana volume in Europe. Net sales for the six
months ended June 30, 2002 increased to $1.3 billion versus $1.2
billion last year.

Net interest expense in the second quarter was $11 million, which
was $19 million lower than the same period a year ago, due
primarily to the significant reduction in parent company debt
resulting from the company's financial restructuring.

Depreciation and amortization expense in the 2002 second quarter
was $10 million, which was $12 million lower than the same period
a year ago, primarily as a result of reductions to carrying
values of depreciable assets recorded upon the company's
emergence from its financial restructuring.

Free cash flow (EBITDA and interest income less interest expense,
income taxes and capital expenditures) increased to $47 million
from $4 million in the second quarter of 2001 primarily as a
result of the company's improved EBITDA and lower interest
expense.

"Looking beyond the beneficial impact of our recent financial
restructuring, our focus is on improving quality and cost
efficiency," said Cyrus F. Freidheim, chairman and chief
executive officer. "We are strengthening ongoing local
improvement initiatives, such as our 'War on Waste' in the
tropics, and launching new global programs to significantly
reduce purchasing and overhead costs. We are making good progress
in our top- to-bottom review of business units and strategy,
which we will discuss with the investment community in
September."

Fresh Produce

Fresh Produce operating income in the 2002 second quarter
increased to $61 million, up from $25 million in the prior year
quarter. The strength of major European currencies relative to
the U.S. dollar resulted in an improvement in operating income of
approximately $25 million from the prior year quarter, primarily
due to conversion of euro receivables into U.S. dollars. In core
European markets, the company benefited from an $8 million
decrease in import license costs. On volume that was comparable
to the prior year quarter, the company experienced a 7 percent
decline in core European market local pricing, which was in part
caused by the early appearance of competing summer fruits and by
the rapid decline of the dollar late in the quarter. In Central
and Eastern Europe, the company doubled its volume to 4.6 million
boxes and realized a 16 percent increase in local pricing versus
last year.

In North America, banana pricing was 2 percent lower than a year
ago on comparable volume. Additionally, earnings from other fresh
produce increased by approximately $5 million versus the prior
year quarter, due primarily to higher volume and lower costs.

In the Asia Pacific region, where the company has a relatively
small presence, a 62 percent increase in local banana prices
generated a $3 million earnings improvement.

The company's banana production costs increased by approximately
$7 million primarily as a result of lower productivity relating
to labor issues and previous work stoppages in its Honduras and
Armuelles, Panama divisions. Fresh Produce operating income
benefited from $9 million lower depreciation and amortization
expense on reduced property, plant and equipment carrying values
recorded upon the company's emergence from financial
restructuring in March 2002.

Processed Foods

Processed Foods operating income was essentially breakeven in the
second quarter of both 2002 and 2001. Higher unit costs, the
result of a planned reduction in the fall 2001 harvest, were
offset by a 4 percent increase in prices on canned vegetables and
a $3 million reduction in depreciation and amortization expense.

Operating Statistics

In keeping with Chiquita management's desire to improve financial
transparency and better enable investors to understand key
factors driving the company's financial and operating
performance, beginning this quarter, Chiquita will include tables
of expanded financial and operating statistics as part of its
quarterly earnings releases.

Analyst and Investor Meeting

The company also announced that it will host a meeting for
analysts and institutional investors in New York on Sept. 24,
2002, to discuss the results of the company's top-to-bottom
review and its future business strategy. Individuals interested
in attending are encouraged to provide their full contact
information by e-mail to Bill Sandstrom, director of investor
relations, at bsandstrom@chiquita.com.

Chiquita Brands International is a leading international
marketer, producer and distributor of high-quality fresh and
processed foods. The company's Chiquita Fresh Group is one of the
largest banana producers in the world and a major supplier of
bananas in North America and Europe. Sold primarily under the
premium Chiquita(R) brand, the company also distributes and
markets a variety of other fresh fruits and vegetables. In
addition, Chiquita Processed Foods is the largest processor of
private-label canned vegetables in the United States. For more
information, visit the company's web site at
http://www.chiquita.com/.

On March 19, 2002, Chiquita completed its financial restructuring
when its Plan of Reorganization under Chapter 11 of the U.S.
Bankruptcy Code became effective.

To see financial statements:
http://bankrupt.com/misc/Chiquita_Brands.htm

CONTACT:  CHIQUITA BRANDS INTERNATIONAL, INC.
          James B. Riley, +1-513-784-6307
          Email: jriley@chiquita.com

          William T. Sandstrom, +1-513-784-6366
          Email: bsandstrom@chiquita.com



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

AEROMEXICO: To Replace 15 Aircraft With Boeing Jets
---------------------------------------------------
Aerom‚xico has announced it will replace 15 planes in its fleet
with new generation Boeing airplanes, a move, which requires
investment of some US$500 million. Replacement of all DC-9
airplanes would be done gradually during October and November
this year.

In a press release, the Company, which currently has Boeing
models 757 and 767, MD80 and DC9, reported that the signing of
the contracts would be finalized soon once both parties have
defined certain operating issues.

AeroMexico is one of the two main units of Mexican government-
owned airline holding company. The airline is scheduled to be
sold-off this year.

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


CINTRA: Reports Second Quarter 2002 Results
-------------------------------------------
(All figures are expressed in pesos of equivalent purchasing
power as of June 30th, 2002, unless specified otherwise.
Financial Statements meet Mexican GAAP, and are not audited.)

CINTRA, S.A. DE C.V., (BMV:CINTRA) Mexico's leading air
transportation system reported its non audited results for the
second quarter 2002, emphasizing the following:

-  Load factor, 59.4%
-  Total income MXN6,667 million
-  EBITDAR, 9.5% of revenue
-  Operating loss MXN291 million
-  Net loss MXN710 million

CINTRA reported total revenues for this quarter of MXN6,667
million, which represents a 9.2% decrease with respect to 2Q
2001. EBITDAR was MXN637 million, lower than MXN741 million in 2Q
2001, a decrease of 14.1%. The company reported an operating loss
of MXN291 million, better than the same period last year in 22.7%
and a net loss of MXN710 million compared to MXN69 million in the
second quarter 2001. In spite of the negative operating results,
the cash increased MXN250 million, which reflects the careful
management of it.

The income decrease is as result of  the economic deceleration in
Mexico and the U.S., the effects of the attacks from last
September, the unfair competition from domestic airlines,
compensated by the devaluation of the Mexican peso in real terms
during the quarter.

The ASK's and RPK's reported 9,927 and 5,790 million
respectively. While  capacity decreased 6.3%, passenger revenue
did in 14.5% quarter over quarter.

In May Cintra carried out a restricted invitation contest between
renowned invest bankers, to advise the company in the promotion
and coordination of Cintra's assets sale processes. As a result
of such contest, Merrill Lynch M‚xico, S.A. de C.V. was selected
due to its technical and economic conditions.

About the MXN1,000 million loan that the Congress authorized for
all the national airlines during the last quarter 2001, it has
not been disbursed the and first amount that was expected by
March 2002. The operation rules were issued and we expect to
receive the cash this July.

The load factor was 59.4% during the month, six percentage points
lower than 2Q 2001 due to the deceleration in passenger revenue
compared to capacity.

National passenger revenues were 3,566 million, 9.8 % lower than
those of the second quarter 2001, particularly for the demand
reduction of 10.8 % quarter over quarter, compensated by an
increase in 2.2% in the yield.

International passenger revenues were affected by the economic
deceleration in the United States and Mexico, the effects of the
attacks in the United States during September last year,
compensated by the peso devaluation. In pesos, 2,245 million, a
16.7 % lower than those in the same quarter 2001. However, in
dollars reported 236.4 million, 15.2 % lower than the same period
last year, due to a decrease in demand in 17.7%.

Cargo revenues decreased 8.7 % compared to the same period 2001,
reaching MXN285 million due to the economic deceleration in the
United States and Mexico, compensated by the devaluation of the
Mexican peso in real terms.

During the quarter, Mexicana started its route Mexico -
Guadalajara - Sacramento, four times a week.

We continued with our efforts and strategies to reduce the
Operation Costs that were 6,030 million, 8.7 % lower than the
same period 2001; however, the income reduction was superior. The
personnel cost was MXN2,265 million, 4.4% in real terms lower
than the same period last year, which shows the renegotiations of
the labor contracts and a personnel reduction during the last
months 2001 and this semester. The decrease in jet fuel
expenditure was 27.7 % than last year's second quarter,
equivalent to MXN844 million, due to a decrease in the
international market price per liter and the incorporation of new
planes to Mexicana fleet, which jet fuel consumption is
significantly lower. The service to passenger cost was MXN205
million, 20.7 % lower than the second quarter 2001, due to less
transported passengers and austerity measures.

During this quarter the commissions were reduced in 16.8%,
equivalent to MXN499 million.  Administration cost decreased 8.1%
as a result of strong austerity measures, including the
elimination of corporate activities. The insurance figures
reflected a spectacular increase in 212.8 % to reach MXN156
million due to the increase in the liability premium.

Continuing with the strong efforts to reduce costs, the ASK /
cost for the period April - June 2002 decreased 2.7% with respect
to the same period last year. Also, the Mexicana fleet renovation
program continued with two Airbus A319 and on Boeing B-757
grounding three Boeing B-727/200 and Aerolitoral acquired six
SAAB 340 grounding five Metro III.

EBITDAR was MXN637 million, equivalent to 9.5 % of the total
revenues, during the same period last year with a similar figure,
it represented a 10 % of the total revenues.

As a result of the above, during the second quarter 2002 CINTRA
reports an operation loss of MXN291 and a net loss of MXN710
million.

Originated by the devaluation or the Mexican peso, the exchange
rate difference affected importantly the company results, it was
398 million during this quarter and 202 million profit during the
same period last year, originating a difference of MXN600
million.

The flow generated by the operation during the second quarter was
MXN761 million, that compared to the same period last year
reflects a positive difference of MXN234 million. The operative
flow generation at the first semester last year was only MXN97
million.

To see financial statements: http://bankrupt.com/misc/Cintra.doc

CONTACT:  CINTRA
          Xola 535, Piso 16, Col. del Valle
          03100 M,xico, D.F., Mexico
          Phone: +52-5-448-8050
          Fax: +52-5-448-8055
          Contacts:
          Jaime Corredor Esnaola, Chairman
          Juan Dez-Canedo Ruiz, CEO
          Rodrigo Ocejo Rojo, CFO
                       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

          MERRILL LYNCH & CO., INC.
          World Financial Center,
          North Tower, 250 Vesey St.
          New York, NY 10281
          Phone: 212-449-1000
          Toll Free: 800-637-7455
          Home Page: http://www.merrilllynch.com
          Contact:
          David H. Komansky, Chairman and CEO
          E. Stanley O'Neal, President, COO, and Director
          Thomas H. Patrick, EVP and CFO

          MERRILL LYNCH MEXICO
          Paseo de las Palmas No. 405
          Piso 8
          Col. Lomas de Chapultepec
          11000 Mexico City, Mexico
          Phone: 5255-5201-3200
          Fax: 5255-5201-3222

          TRANSPARENCIA MEXICANA
          Dulce Olivia 71
          Colonia Villa Coyoac n
          DF, 04000
          Contact:
          Federico Reyes Heroles, President
          Eduardo A. Boh>rquez, Executive Secretary

          National Chapter
          Phone/Fax: +52-5-5668 0955
          Email: tmexican@data.net.mx
          Home Page: www.transparenciamexicana.org.mx


GRUPO BITAL: 2Q02 Results Show Weak Performance, Says S&P
---------------------------------------------------------

Standard & Poor's Rating Services said Tuesday that Bital S.A.'s
(BBpi) second-quarter results remain weak, contrasting with those
reported by its peers. Bital's poor results have been a concern
for Standard & Poor's. During the first half of the year, bottom
line profits of Mexican pesos (MxP) 127.2 million were lower than
results from both mid-year 2001 (-43%), and first-quarter 2002 (-
37%).

Despite maintaining the lowest funding cost in the system, the
bank's lower net interest income and lower trading gains, which
were not compensated with higher fees and commissions, negatively
affected operating revenues. Additionally, the bank has been
unable to decrease its operating costs, which at June 2002
represented 80% of revenues. The bank also took an extraordinary
expense of MxP27.6 million related to changes in its corporate
structure.

Bital has been the most active bank in growing its loan
portfolio, particularly on the consumer business, which grew 55%
year-over-year. However, the bank still maintains a large
proportion of nonperforming loans (10%), with reserves covering
1.5x reported delinquencies.

Right now, the main challenge for the bank is to obtain the
necessary capital to comply with its capitalization program. The
$100 million capital injection from its shareholders and ING
Bank's $200 million potential investment, are still insufficient.

The controversy over a potential change in ownership continues.
With Banco Santander Central Hispano S.A.'s decision not to
increase its participation in the bank, the main bidder is now
Hongkong and Shanghai Banking Corp. Ltd. (The), which is expected
to give the bank's shareholders an offer soon.


GRUPO IUSACELL: Shares Down On Analysts' Negative Outlook
---------------------------------------------------------
Shares of Grupo Iusacell fell 14 centavos, or 12%, to MXN1.01,
coming off a record low of 99 centavos, says Bloomberg. The
shares have fallen 82% in the past 12 months, as analysts are
concerned about the Company's ability to meet its debt payments.

Recently, Standard and Poor's lowered the Company's foreign and
local currency credit ratings to `B+' from `BB' due to "further
erosion of Iusacell's market share and revenues."

"The downgrade also incorporates our growing concerns about the
company's debt service and refinancing ability," S&P added.

S&P warned that the rating could be reduced even further if the
cellular telephone company does not implement operational and
financial measures to revert the negative trend in its financial
statements.

Through June 2002, Iusacell registered income of US$269 million,
20% less than in the same period of last year.

To see financial statements:
http://bankrupt.com/misc/Grupo_Iusacell.htm

CONTACT:  GRUPO IUSACELL, S.A. DE C.V.
          Investor: Russell A. Olson, Chief Financial Officer
          Tel: +5255-5109-5751
          Email: russell.olson@iusacell.com.mx

          Carlos J. Moctezuma,
          Manager, Investor Relations
          Tel: +5255-5109-5780
          Email: carlos.moctezuma@iusacell.com.mx


GRUPO MEXICO: In Debt Talks With Creditors
------------------------------------------
Grupo Mexico SA announced it is in talks with a group of
creditors led by Bank of America Corp. to renegotiate US$574
million of debt after the world's third-largest copper miner
defaulted on some loans, reports Bloomberg.

"We are currently pursuing discussions with our creditors in
order to substantially restructure our indebtedness by the end of
2002," the Company said.

In a filing with the U.S. Securities and Exchange Commission,
Grupo Mexico SA, the world's third largest copper miner, stated
that it defaulted on part of its US$1.3 billion in debt after
copper prices fell to a 14-year low.

According to the filing made July 15, earlier this year, the
Company failed to make payments on more than US$450 million in
debt including loans to bank creditors Bank of America Corp. and
Bank of Nova Scotia. The missed payments triggered contractual
provisions that forced the Company to also default on "many" of
its other bonds and loans, the filing revealed.

Grupo Mexico failed to keep up with debt payments as revenue has
slumped at its U.S., Mexican and Peruvian mines and smelting
plants after copper prices fell last year on weak demand by U.S.
manufacturers of cables, computers and other products. The
Company's debt load rose in 1999 when it bought Tucson, Arizona-
based metals producer Asarco Inc. for US$2.25 billion, borrowing
millions from 16 banks to finance the purchase.

Grupo Mexico, which reported US$2.8 billion of revenue last year,
has a total US$2.8 billion of debt. Its shares fell MXN0.60, or
3.9%, to MXN14.9 in 3 p.m. Tuesday's trading in Mexico. The stock
has climbed 66% this year.

CONTACT:  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

          BANK OF AMERICA - Corporate Headquarters
          Bank of America Corporate Center
          100 North Tryon Street
          Charlotte, North Carolina 28255
          www.BankofAmerica.com
          Contacts: Ken Lewis, Chairman & CEO



ISPAT INTERNATIONAL: Extends Exchange, Solicitation Consent Date
----------------------------------------------------------------
Ispat International N.V. ("Ispat"), (NYSE: IST US; AEX: IST NA),
announced Monday that Ispat Mexicana, S.A. de C.V. ("Imexsa"),
Ispat's Mexican operating subsidiary, has extended its exchange
offer for all outstanding 10-1/8% Senior Structured Export
Certificates due 2003 of Imexsa Export Trust No. 96-1 (the
"Senior Certificates"). The exchange offer will now expire at
5:00 p.m., New York City time, on August 23, 2002, unless
otherwise extended or terminated by Imexsa (the Expiration
Date"). The exchange offer had been scheduled to expire at 5:00
p.m., New York City time, on July 29, 2002. The exchange offer is
being extended to allow for additional time to complete
documentation required under the agreed upon terms of the
exchange. Under the terms of the exchange offer, Imexsa will
offer to exchange 10-5/8% Senior Structured Export Certificates
due 2005 to be issued by Imexsa Export Trust No. 96-1 (the "New
Senior Certificates") for Senior Certificates validly tendered
and accepted for exchange. The New Senior Certificates will be
fully and unconditionally guaranteed by Ispat, Grupo Ispat
International S.A. de C.V. ("Grupo") and certain of the
subsidiaries of Imexsa on a senior basis. The New Senior
Certificates will also be secured on a pro rata basis with
Imexsa's bank loans by liens on certain assets of Imexsa and by a
pledge of the stock of Imexsa and Grupo.

The exchange offer is conditioned upon the holders of not less
than 96% of the outstanding principal amount of Senior
Certificates having validly tendered and not withdrawn their
Senior Certificates prior to the Expiration Date and upon the
other terms and conditions set forth in Imexsa's Supplemental
Offering Memorandum and Consent Solicitation Statement dated June
17, 2002, which is supplemental to the Offering Memorandum and
Consent Solicitation Statement dated January 24, 2002.

In connection with the exchange offer, Imexsa is also soliciting
consents from holders of Senior Certificates to, among other
things, amend certain agreements governing the Senior
Certificates. Holders tendering their Senior Certificates in the
exchange offer must also deliver consents. Consents may not be
withdrawn following the Expiration Date, unless the exchange
offer is terminated.

Requests for documentation should be made to the Information
Agent for the exchange offer, D.K. King & Co., Inc., at (800)
847-4870. Questions regarding the transaction should be directed
to financial advisor to Imexsa, Dresdner Kleinwort Wasserstein at
(212) 969-2700.

This announcement is not an offer to purchase or a solicitation
of consents with respect to any Senior Certificates or an offer
of New Senior Certificates for sale. Securities may not be
offered and sold in the United States absent registration or an
exemption from registration. Any public offering of securities to
be made in the United States must be made by means of a
prospectus that may be obtained from the issuer or selling
security holder and will contain detailed information about the
company and management, as well as financial statements.

CONTACT:

Annanya Sarin
Head of Communications
+ 44 20 7543 1162 / +31 10 404 6738

T.N Ramaswamy
Director, Finance
+ 44 20 7543 1147

John McInerney
Citigate Dewe Rogerson
Investor Relations
+1 212 419 4219


MAXCOM TELECOMUNICACIONES: 2Q02 Results Show Improvement
--------------------------------------------------------
- 18% increase in sequential revenues, 2Q02 vs. 1Q02, and 100%
increase over 2Q01
- 33% reduction in sequential EBITDA loss, 2Q02 vs. 1Q02, and 66%
reduction over

2Q01

- 7% growth in lines in service, 2Q02 vs. 1Q02, and 174% growth
over 2Q01 11% increase in number of customers, 2Q02 vs. 1Q02, and
215% increase over 2Q01.

Maxcom Telecomunicaciones, S.A. de C.V., a facilities-based
telecommunications provider (CLEC) using a "smart build" approach
to focus on small - and medium -sized businesses and residential
customers in the Mexican territory, on Tuesday announced its
unaudited results for the second quarter of 2002.

LINES:

The number of lines in service at the end of 2Q02 increased 174%
to 91,009 lines from 33,205 lines at the end of 2Q01, and 7% when
compared to 85,339 lines in service at the end of 1Q02.

During 2Q02 line construction improved by 25% to 24,035, from
19,230 constructed lines in the same period of last year.
Particularly positive was the 74% increase when compared to
13,848 constructed lines during 1Q02. Inventory of constructed
lines at the end of the quarter was 42,247 lines; 48% of those
lines are located in clusters developed and built during 2Q02.

During 2Q02, 15,288 new lines were installed, a 39% increase when
compared to 10,982 new installed lines during 2Q01, and 11% below
the 17,259 lines installed in 1Q02. Also, during 2Q02, voluntary
churn resulted in the disconnection of 3,322 lines (a rate of
1.2% monthly) while involuntary churn resulted in the
disconnection of another 6,296 lines (or a 2.1% monthly average).
Additionally, 716 lines were disconnections from high usage
customers.

CUSTOMERS:

Total customers grew 215% to 58,772 at the end of 2Q02, from
18,653 at the end of 2Q01, and 11% when compared to 53,059
customers as of March 31, 2002.

The growth in number of customers by region was distributed as
follows: (i) in Mexico City customers increased by 288% from 2Q01
and 24% from 1Q02; and (ii) in Puebla the increase was 172% from
2Q01 and 2% from 2Q02.

The growth in number of customers by segment was the following:
(i) business customers rose by 40% from 2Q01 and 3% from 1Q02;
and (ii) residential customers increased by 245% from 2Q01 and
11% from 1Q02.

"Despite of the sluggish Mexican economy, decreasing GDP and
increasing unemployment rates, residential lines grew slightly
while we were able to maintain the number of business lines at
the same level", said Fulvio Del Valle, President and Chief
Executive Officer of Maxcom. Mr. Del Valle added "we are
anticipating an improvement in the third quarter due to the
current rate of construction and the results of the new sales
force in place during the last half of 2Q02; this should
partially offset the shortfall of this reporting quarter vs. our
original projections".

REVENUES:

Revenues for 2Q02 increased 100% to Ps$123.4 million from Ps$61.8
million reported in 2Q01. The net change in revenue reflects: a
174% increase of lines in service, and a ten-fold increase in
non-recurring charges. During 2Q02, non-recurring charges
represented 7% of the total revenues, while during the same
period of last year, they only represented 1%. These increases
were partially offset by a 30% decrease in the company's ARPU,
which declined from US$69 in 2Q01 to US$48 in 2Q02; however, the
US$48 reflect a 9% improvement when compared to US$44 ARPU in
1Q02.

The decrease in ARPU was primarily the result of a combination of
a 67% reduction in revenues from high usage customers, and a
change in business / residential mix of lines from 47/53 in 2Q01
to 26/74 in 2Q02. Despite the drop, Maxcom continued to show
improvement in its core small and medium size enterprise market
where it experienced a 48% growth in ARPU between 2Q01 and 2Q02.
Additionally, ARPUs, which are expressed in US dollars for
readers' convenience, were negatively affected by 10% devaluation
of the Mexican peso during 2Q02.

Revenues for 2Q02 increased 18% to Ps$123.4 from Ps$105.0 million
reported in 1Q02. The net change in revenue reflects: (i) a 7%
increase of lines in service; and, (ii) a 9% increase in the
company's ARPU to US$48 in 2Q02, from US$44 in 1Q02, driven by an
11% increase in usage and 65% increase in non- recurring charges.

COST OF NETWORK OPERATION:

Cost of Network Operation in 2Q02 was Ps$46.9 million, a 26%
increase when compared to Ps$37.1 million in 2Q01. This increase
was generated by: (i) Ps$17.7 million, or 75% increase in network
operating services and technical expenses, due to a 174% growth
in lines in service; and, (ii) lower installation expenses and
cost of disconnected lines in the amount of Ps$8.1 million (on a
pro forma basis, these costs would have been Ps$2.0 million in
2Q01).

Cost of Network Operation increased 4% when compared to Ps$45.1
million in 1Q02. This net increase was mainly generated by: (i)
Ps$2.8 million, or 7% increase in network operating services and
technical expenses, associated with a 7% growth in lines in
service; and, (ii) lower installation expenses of Ps$1.0 million
due to a 11% decrease in installed lines.

SG&A:

SG&A expenses were Ps$99.7 million in 2Q02, which compare to the
Ps$92.0 million in 2Q01. The 8% increase was mainly originated
by: (i) higher consulting fees of Ps$2.1 million; (ii) higher
leasing costs of Ps$5.4 million; and, (iii) higher bad debt
provisioning of Ps$1.3 million; partially offset by lower
marketing expenses of Ps$1.8 million.

SG&A increased Ps$5.2 million, or 6%, from Ps$94.5 million in
1Q02. The net increase was mainly originated by higher: (i)
consulting fees of Ps$3.4 million; (ii) maintenance expenses of
Ps$1.7 million; (iii) local taxes and rights and insurance costs
of Ps$1.0 million; (iv) marketing expenses of Ps$1.7 million;
and, (v) leasing costs of Ps$1.3 million, which, in turn, were
partially offset by lower bad debt provisioning of Ps$2.3
million, and sales commissions of Ps$1.6 million.

EBITDA:

EBITDA for 2Q02 was a negative Ps$23.1 million, which compares
favorably with a negative Ps$67.3 million reported in 2Q01 and
negative Ps$34.6 million registered in 1Q02. EBITDA margin
improved from a negative 109% in 2Q01 and negative 33% in 1Q02,
to a negative 19% in 2Q02.

EBITDA continued improving, in line with the target of reaching
break even on a monthly basis. While EBITDA for the month of
March 02, was negative by Ps$7.8 million, monthly EBITDA for June
2002 was negative Ps$6.4 million, representing an 18%
improvement.

CAPITAL EXPENDITURES:

Capital Expenditures for 2Q02 were Ps$120.4 million, a 19%
increase when compared to Ps$100.8 million in 2Q01, and a 101%
increase when compared to Ps$60.0 million in 1Q02.

CASH POSITION:

Maxcom's Cash position at the end of the second quarter of 2002
was Ps$498.7 million in Cash and Cash Equivalents, compared to
Ps$671.3 million in Cash and Cash Equivalents, and Ps$382.6
million in Restricted Cash at the end of 2Q01. Cash and Cash
Equivalents at the end of 1Q02 were Ps$55.4 million, and Ps$189.0
million in Restricted Cash.

"The improvement in ARPUs from the previous quarter was very
positive and reinforced our revenue stream. Moreover, we were
able to substitute the disconnections in the business sector with
healthier customers and lines. These facts combined with the
strict controls in costs and expenses, improved significantly our
EBITDA margins towards our goal of reaching breakeven point on a
monthly basis," said Eloisa Martinez, Chief Financial Officer of
Maxcom.

RECENT DEVELOPMENTS:

In the last few days Maxcom executed an agreement in principle
for the acquisition of a Fiber Optic backbone, with a length of
approximately 2,000 kilometers, covering the main cities of
Mexico and a border crossing. This acquisition will represent a
financial benefit over the projections presented to Bondholders
and Shareholders during the recently concluded restructuring
process. Also, it will enhance both its planned local telephony
business expansion, as well as its long distance business.
Further details will be provided upon closing.

A conference call will be held to discuss 2Q02 unaudited results
on Wednesday, July 31, 2002 at 10:00 a.m. New York City time /
9:00 a.m. Mexico City time. To participate, please dial + (719)
867-0640, confirmation code 620636 ten minutes prior to the start
of the call.

Maxcom Telecomunicaciones, S.A. de C.V, headquartered in Mexico
City, Mexico, is a facilities-based telecommunications provider
using a "smart- build" approach to deliver last-mile connectivity
to small- and medium-sized businesses and residential customers
in the Mexican territory. Maxcom launched commercial operations
in May 1999 and is currently offering local, long distance and
data services in Mexico City and the City of Puebla.

LINES                   2Q01    1Q02    2Q02   2Q01  1Q02
        Mexico City
Business Lines         12,052  18,972  18,979   57%    0%
Residential Lines       6,240  25,516  31,071  398%   22%
       Puebla
Business Lines          3,560   4,950   4,815   35%   -3%
Residential Lines      11,353  35,901  36,144  218%    1%
  TOTAL                33,205  85,339  91,009  174%    7%

CUSTOMERS               2Q01    1Q02    2Q02   vs.   vs.
                                              2Q01  1Q02
Business                2,748   3,741   3,847   40%    3%
Residential            15,905  49,318  54,925  245%   11%
  TOTAL                18,653  53,059  58,772  215%   11%

Mexico City             6,964  21,884  27,030  288%   24%
    Puebla             11,689  31,175  31,742  172%    2%

TRAFFIC                                  2Q01
    Million Minutes        Apr      May      Jun     Total
    Inbound                38.1     38.6     41.6     118.4
    Outbound               39.1     52.8     45.4     149.4

    Outbound Local         97%      96%      96%       96%
    Outbound LD             3%       4%       4%        4%

TRAFFIC                                   1Q02
     Million Minutes        Jan      Feb      Mar     Total
     Inbound               58.5     52.4     54.2     165.0
    Outbound               72.5     71.5     77.3     221.3

    Outbound Local           94%      95%      95%       95%
    Outbound LD               6%       5%       5%        5%

TRAFFIC                                    2Q02
      Million Minutes       Apr      May      Jun     Total
    Inbound                59.7     58.7     54.8     173.3
    Outbound               83.7     84.0     79.0     246.7

    Outbound Local         95%      95%      95%       95%
    Outbound LD             5%       5%       5%        5%

ARPU (US$)                 2Q01        1Q02        2Q02
    Business
     Monthly Charges       $22.46      $25.08      $25.19
     Usage                 $76.15      $52.27      $59.69
     Subtotal              $98.61      $77.35      $84.87
     Non-recurring          $1.41       $4.38       $2.20
    Total Business        $100.02      $81.73      $87.08
    Residential
     Monthly Charges       $16.98      $17.80      $17.94
     Usage                 $14.37      $11.02      $12.38
     Subtotal              $31.35      $28.82      $30.31
     Non-recurring          $0.25       $1.11       $3.71
    Total Residential      $31.60      $29.93      $34.02
    Company
     Monthly Charges       $19.94      $19.81      $19.87
     Usage                 $47.77      $22.41      $24.96
     Subtotal              $67.71      $42.22      $44.83
     Non-recurring          $0.88       $2.01       $3.31
    Total Company          $68.59      $44.23      $48.14

To see financial statements:
http://bankrupt.com/misc/MAXCOMTELECOMUNICACIONES.htm

CONTACT:  MAXCOM TELECOMUNICACIONES, S.A. DE C.V.
          Mexico City, Mexico
          Jose-Antonio Solbes
          Phone: (5255) 5147-1125
          E-mail: investor.relations@maxcom.com

          CITIGATE DEWE ROGERSON
          New York, NY
          Lucia Domville
          Phone: (212) 419-4166
          E-mail: lucia.domville@citigatedr-ny.com


PEMEX PETROQUIMICA: Pemex Combines Units Into Single Subsidiary
---------------------------------------------------------------
In a move to help its cash-strapped subsidiary, Mexico's state
oil company Pemex revealed plans to integrate the separate
production units of its petrochemicals arm Pemex Petroquimica
into a single subsidiary. The move comes after the Company saw
the present organizational structure of Pemex Petroquimica led to
a loss in competitiveness throughout the production chain.

A study undertaken earlier this month by Mexico's UNAM University
showed that Pemex Petroquimica is in technical bankruptcy after
posting operating losses of MXN23.4 billion (US$2.4 billion) over
the last four years.

The different production units of Pemex Petroquimica to be
included in the management reorganization are the Cangrejera,
Cosoleacaque, Escolin, Independencia, Morelos, Pajaritos, Tula
and Camargo refineries.

Already, Pemex Petroquimica's board, which includes finance
minister Franciso Gil Diaz, energy minister Ernesto Martnes and
Pemex CEO Raul Munoz, has authorized management teams to begin
the integration process.

Hydrocarbons deputy minister Jose Antonio Barges Mestre believes
that the new structure will reduce costs, improve management
control and make it easier for Pemex Petroquimica to negotiate
strategic alliances with major players in the petrochemicals
private sector.



=======
P E R U
=======

BACKUS: Bavaria To Visit Peru To Deal With Polar's Claims
---------------------------------------------------------
Representatives of the Colombian brewery, Bavaria SA, will visit
Peru shortly to provide the information required by the country's
securities commission Conasev in relation to its ongoing
investigation of the Colombian firm's purchase of a large stake
in Peruvian brewer Union de Cervecerias Peruanas Backus &
Johnston SAA (Backus), reports El Comercio.

Conasev is currently investigating complaints filed by
Venezuela's privately-held brewer Empresas Polar SA about
Bavaria's recent purchase of a 21.96% voting stake in Backus for
about US$420 million. The purchase works out to 18.23% of its
corporate capital and is enough to make it likely that Bavaria
could take at least three seats on Backus' board of directors.

Polar, which holds 22.1% of Backus' voting shares, has complained
that Bavaria's off-market transaction may have skirted rules that
say any buyer taking a 25% share in a listed company has to do so
via a public offer. At the same time, Polar is also asking
Conasev to block any more transactions involving Peruvian brewer
Backus.

Bavaria, for its part, has responded to Polar's claim, saying
that its purchase of a voting stake in Backus had the approval of
the regulators and the backing of the shareholders.

"Polar, which has had all the time to buy shares in Backus since
it entered the company in 1998, insists on criticizing the
transaction that has been totally approved by local authorities,"
Bavaria has said in a statement.

"Bavaria continues to think the most responsible role of an
investor is the creation of value for Backus, instead of the
publication of baseless accusations," the statement added.

Backus is the largest brewer in Peru and the sixth largest brewer
in Latin America, with 2001 sales of US$507 million.

Email: cobackus@backus.com.pe
URL: http://www.backus.com.pe/INDEX-I.HTM



=============
U R U G U A Y
=============

BANCO DE MONTEVIDEO: Massive Withdrawals Lead To Suspension
-----------------------------------------------------------
Uruguayan monetary authorities ordered a bank holiday shortly
before banks opened for business at 1:00 pm Tuesday. According to
a statement issued by The Office of the President, the holiday
was ordered to allow regulators to shut down two intervened
institutions Banco Montevideo and Caja Obrera.

Uruguay's banking system has been affected by financial crisis in
neighboring Argentina. Reserves in Uruguayan banks had fallen
from around US$13 billion last year to US$9 billion at present.
Massive withdrawals from jittery depositors on Monday alone
amounted to US$52 million. The Central Bank's dollar reserves had
also fallen from US$3 billion to US$725 million.

The value of the country's currency has fallen to UYU35 for a
dollar, Tuesday. It was trading at UYU17 to the dollar June 20
when the country decided to float its currency.

Uruguayan officials are now in talks with the International
Monetary Fund in Washington about the latest payout from the US$3
billion it is seeking to borrow from the institution.

Authorities in the country are waiting for the results of the
negotiations to decide whether to extend the bank holiday.

Banco de Montevideo had UYU11 billion (US$398 million) of assets
as of December and UYU8.7 billion of deposits. Before deposit
withdrawals started in December, the bank was already strapped
for cash after purchasing Caja Obrera from the government in
November last year.

CONTACT:  BANCO MONTEVIDEO
          Misiones
          1399 - Montevideo
          Fax: 9162880
          E-mail: info@bm.com.uy
          Home Page: http://www.bancomontevideo.com.uy
          Contact: Sr. Marcelo Pestarino, President



=================
V E N E Z U E L A
=================

SIDOR: Creditors, Government Approve 60-Day Debt Restructuring
--------------------------------------------------------------
Steelmaker Siderurgica del Orinoco (Sidor) obtained preliminary
agreement with bank creditors and the government to have a 60-day
period to restructure US$1.7 billion in debt, Bloomberg reports.

The preliminary agreement includes writing off up to half of the
Company's debt, and capitalization from the government through
share increase.

Sidor, Venezuela's largest steelmaker suspended US$31.3 million
interest payment on debt last December. Sidor's ability to pay
its obligations has been hampered by low international steel
prices and a slumping economy.

The Company is 70%-owned by a consortium called Amazonia, which
is made up of Mexico's Hylsamex SA, Argentina's Siderar SA,
Venezuela's Sivensa, and Brazil's Usiminas SA. The remainder is
state-owned.

CONTACT:  SIDERURGICA DEL ORINOCO, C.A. (SIDOR)
          Edificio General, Piso 9
          Avda. La Estancia
          Chuao, Caracas 1060
          Venezuela
          Tel: (582) 902 3800/3917/3955
          Fax: (582) 993 2930
          Home Page: www.sidor.com.ve/



               ***********


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
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