TCRLA_Public/021003.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, October 3, 2002, Vol. 3, Issue 196



ARGENTINE BANKS: To Return Frozen Deposits to Clients
BANCO VELOX: Central Bank Extends Suspension By 30 Days
CTG: Must Service $54M In Debt By Year-End Or Face Bankruptcy
DINAR: Labor Ministry Fines Likely After Service Halt
PAN AMERICAN: Issuing $15M in Debentures October 16

PEREZ COMPANC: Nearing Petrobras Buyout's Conclusion
TELECOM ARGENTINA: Ex-Minister, Fund In Race For Control
TELEFONICA DE ARGENTINA: Sale of $26M in Surplus Assets Planned

*Argentina Plans to Restructure Financial System


GLOBAL CROSSING: Chairman Asserts Innocence
TYCO INTERNATIONAL: Probe Yet To Uncover Malpractices


BRAZILIAN BANKS: Goldman Trims Ratings Amid Election Concerns
CSN: BNDES Hires UK Law Firm To Study Corus Merger

* Brazil FM: Brazil Has No Reason to Restructure its Debt


AEROMEXICO: Wards Off Strike After Union Signs Contract
CYDSA: Shakes Up Management To Improve Situation
GRUPO BITAL: Consummates Takeover of Atlantico


BLADEX: Plans Recapitalization Following Argentine Losses


MINERA VOLCAN: Workers' Strike Creating More Losses


EDC: Obtains $47.5M Syndicated Loan


ARGENTINE BANKS: To Return Frozen Deposits to Clients
Argentine President Eduardo Duhalde is easing the bank freeze to
see how well banks can endure Argentines having unrestricted
access to their accounts for the first time in ten months.

The banking restrictions were imposed to save banks from collapse
last year, reports Dow Jones Newswires Tuesday.

Banks would begin returning as much as ARS1.7 billion in time
deposits that have been frozen since December. This would put
Argentina fragile banking system to test.

"If all goes well today, it may just go to show that the
financial system will recuperate quicker than anyone thought,"
said senior analyst Hernan Fardi of

Last month, economy minister Roberto Lavagna said the government
would return ARS7,000 per clien. He added that banks have the
option to return up to ARS10,000 per client if they feel they are
in a position to do so.

Banks returning more than the ARS7,000 limit include Spain's
Banco Bilbao Vizcaya Argentaria, HSBC Bank and Banca Nazionale de
Lovoro SA, press reports said.

The government and banks are also offering longer-dated bonds
that exceed these limits for term deposits.

Argentine Research senior analyst Rafael Ber projected that most
clients will leave their money in the banks, while others may use
their cash to purchase goods and service they wanted over the

Early indications show some bank clients prefer to leave their
funds in certificates of deposit, as analysts say the average
annual yield on CDs is about 35 percent.

A spokeswoman from Grupo Financiero Galicia, owner of the
country's largest locally owed bank, Banco Galicia y Buenos
Aires, said that so far clients weren't rushing over to withdraw
the maximum amount allowed.

A crime wave of kidnap-for-ransoms and burglaries in recent
months has impelled Argentines to keep their money in financial

The Central Bank has already decreed that depositors may open
bank accounts without withdrawal restrictions, as the government
seeks to revive the financial system as it tries to convince the
International Monetary Fund to sign a debt-relief aid agreement.

At 1515 GMT, the peso was flat at ARS3.735 to the dollar. It has
lost 73 percent of its value after losing its 1-to-1 ratio to the
US dollar in January.

BANCO VELOX: Central Bank Extends Suspension By 30 Days
Argentina's central bank extended by another 30 days the
suspension of Banco Velox, the local bank that was intervened and
suspended on June 28, relates Business News Americas.

Banco Velox actually requested the intervention from the central
bank because of the country's poor economic condition and the
critical financial situation in the Mercosur trade region.

Under Argentine law a bank can be suspended for up to 120 days
before a final decision on its fate has to be made.

Like all banks in Argentina, Banco Velox suffered a drain on
deposits and had difficulty returning clients' savings. However,
Banco Velox's situation was aggravated by the financial woes of
its parent, Uruguay-based business group Velox.

As of December 2001, Banco Velox was ranked 35th among Argentine
banks in terms of deposits and 36th in total assets.

           Sarmiento 532 (1041) Capital Federal
           Buenos Aires
           Phone: 4321-1800
           Fax: 4321-1820
           Home Page:
           Juan Peirano, President
           Carlos Peterson, Representative

CTG: Must Service $54M In Debt By Year-End Or Face Bankruptcy
Bankruptcy looms ahead at Argentine thermo generator Central
Termica Guemes S.A (CTG), which owns and operates a 245MW
thermoelectric plant in the Salta province.

Quoting an unnamed company spokesperson, Business News Americas
said the Argentine utility needs to renegotiate US$54 million in
bonds "as soon as possible," and at the latest by year-end.
Otherwise, it will have to declare bankruptcy.

"We are caught in a financial sandwich because our income has
been cut to a quarter of what it was last year, and our financial
obligations are dollarized... if we can not service our debt we
could go bankrupt," the spokesperson said.

In a statement, Guemes said that come October 4, it will use cash
reserves to pay US$675,000 interest on bonds due last week. The
bonds are reportedly due in 2010.

In September, CTG met with bond trustee, the Bank of New York,
and bondholders to discuss how Argentina's financial, political,
and regulatory situation affected its capacity to make payments.

"There was a lot of talking, and we are still talking with our
bondholders... but so far no agreement has been reached," the
spokesperson said.

To see latest financial statements:

CONTACT:  Central Termica Guemes S.A.
          Avenida Leandro N Alam 822
          Piso 12
          Ciudad Autonoma de Buenos Aires C1001AAQ

          Tel. +54 4311-6064/6065/6066

          MORGAN, LEWIS AND BOCKIUS (New York, New York)
          101 Park Avenue
          New York, NY 10178-0060
          Tel: 212-309-6000
          Fax: 212-309-6273

DINAR: Labor Ministry Fines Likely After Service Halt
Cash-strapped Argentine airline Dinar Lineas Aereas SA, which
halted flights Monday after its shareholders decided to
discontinue funding, could face fines of as much as ARS5,000 for
each of its 300 employees.

According to a report by Bloomberg, the country's Labor Ministry
revealed plans to fine the airline after it failed to inform
transportation authorities of its move to halt flights. The
airline was required to advise Argentina's Secretary of Transport
at least 180 days before suspending service.

Dinar, which filed for protection from creditors on US$30 million
of debt in August, said it was forced to ground flights after the
government-controlled Banco de la Nacion Argentina kept money
from ticket sales that was supposed to be used as a guarantee for
the debt.

PAN AMERICAN: Issuing $15M in Debentures October 16
Argentine oil group Pan American Energy, which is 60%-owned by
British Petroleum and 40% by local firm Bridas, will issue a
class 2 series of US$15 million in debentures October 16, relates
Business News Americas.

The debentures will be placed by Banco de Valores, and will be
issued for a two-year period with a 50% amortization after the
first year, and the remainder due at expiry.

Although the debentures will be issued in US dollars, Pan
American has the option to convert the amount into pesos to meet
local financial obligations, Pan American finances VP Rodolfo
Berisso said.

The bonds, which will be guaranteed by both parent companies,
will be the Company's second this year, after a US$20-million
issue in April.

Proceeds will be used for working capital and to finance
expansion since bank credit had virtually dried up.

Berisso said that the Company will not issue more debentures this
year, adding that two more issues in 2003 are likely.

"[The country's economic situation] is still complicated but a
relatively high commodity price has allowed us to pursue a policy
of aggressive investment," Berisso continued.

The Company will continue to focus investment in its Cerro Dragon
block in the Gulf of San Jorge field in southern Argentina where
it plans to drill 150-200 wells this year, he said.

          Maipu 942 Piso 16
          Capital Federal -( 1006 )
          Buenos Aires - Argentina
          Phone: 011-4315-4012
          Fax: 011-472128

PEREZ COMPANC: Nearing Petrobras Buyout's Conclusion
Argentina's Perez Companc informed the country's stock exchange
that it expects to conclude its deal with Brazil's federal energy
company Petrobras within the next two weeks, relates Business
News Americas.

In July, Perez Companc announced it had reached a preliminary
agreement to sell 58.6% of its capital to Petrobras for US$1.125
billon. However, the transaction hasn't been concluded as Perez
Companc's unit, Pecom Energia, is yet to refinance some US$2.2
billion in debts. Petrobras has conditioned that all debt must be
restructured before it would proceed with the transaction.

However, most of the refinancing has already been completed, and
the two companies are finalizing the exchange of documents,
before the deal can be closed, Pecom Energia president Mario
Lagrosa said in a separate statement to the stock exchange.

          Maipo 1 - Piso 22 - C1084ABA
          Buenos Aires, Argentina
          Phone: (54-11) 4344-6000
          Fax: (54-11) 4344-6315

TELECOM ARGENTINA: Ex-Minister, Fund In Race For Control
Jose Luis Manzano, who served as interior minister under former
Argentine President Carlos Menem, offered to buy Telecom
Argentina Stet-France Telecom SA for US$300 million from its
foreign owners - France Telecom SA and Telecom Italia SpA,
reports Business News Americas.

Manzano submitted the offer in Rome two weeks ago on behalf of a
business group that wants a stake in the telco before debt
restructuring negotiations begin. Business News Americas didn't
mention the name of the group but Bloomberg in its earlier
report, revealed that The Dolphin Fund, a Buenos Aires-based
investment fund formerly run by George Soros, would participate
in the proposed purchase of Argentina's second biggest phone

Manzano was accompanied by Argentine businessmen Damian Midlin
and Rogelio Pagano. Midlin has ties to Soros through his brother,
while Pagano is a former Citibank executive.

Telecom Argentina is the country's largest debtor with
liabilities exceeding US$3.2 billion. The Company has halted all
payments on interest and principal, and restructuring talks are
expected to begin as soon as they can obtain a new rates regime
from the government.

To see financial statements and accompanying notes:

          Alicia Moreau de Justo 50, 10th Floor
          Capital Federal (1107) Repoblica Argentina
          Phone: +54 11 4968 4000
          Home Page:
          Alberto J. Ricciardi, Chief Financial Officer
          Elvira Lazzati, Finance Director
          Pedro Insussarry, Investor Relations Manager
          Phone: (5411) 4968-3626/3627
          Fax: (5411) 4313-5842/3109

TELEFONICA DE ARGENTINA: Sale of $26M in Surplus Assets Planned
Argentine phone company Telefonica de Argentina, which has been
severely battered by the country's deepening recession, the
impact of devaluation on its debt, the suspension of tariff
adjustments and the tariff pesofication, is putting its surplus
assets worth ARS100 million (US$26.5mn) on the block.

According to Business News Americas, the Company hired the local
division of Spanish e-marketplace solutions provider Adquira
( to manage the sale.

Adquira Argentina CEO Patricio Lobos revealed that the surplus
materials were bought a number of years ago but never used
because the original purchases were bad decisions.

Bidders may register until October 4, placing their offers the
following week. Telefonica will select buyers two days after
bidding closes.

Telefonica de Argentina, which is a wholly owned subsidiary of
Spanish telecommunications holding Telefonica, has operations in
Spain, Brazil, Argentina, Chile, Mexico and Peru. It provides
local exchange, long distance, residential Internet access and
directory publishing services. Until October 1999, the Company
was the exclusive provider of
telecommunications services in southern Argentina and controlled
nearly two-third of the Buenos Aires metropolitan area market.
Telefonica Argentina is now allowed to provide telecommunication
services to northern Argentina, where Telecom Argentina Stet
France Telecom S.A. is the incumbent operator.

          Tucuman 1, 18th Floor, 1049
          Buenos Aires, Argentina
          Phone: (212) 688-6840
          Home Page:
          Carlos Fernandez-Prida Mendez Nunez, Chairman
          Paul Burton Savoldelli, Vice Chairman
          Fernando Raul Borio, Secretary

*Argentina Plans to Restructure Financial System
The International Monetary Fund supports the Argentine
government's stand that widespread closure of financial
institutions is not necessary, according to Business News
Americas Tuesday.

Representatives of the government told the IMF that they are
developing a plan to reduce the participation of public banks in
the financial system, according to IMF demands.

Banking analyst Fabio Rodriguez said that it is imperative that
the government comes up with a plan on how to restructure the
financial system, as the present situation only adds to the
uncertainty of what will happen next.

Argentina is seeking to negotiate an agreement with the IMF since
its declaration of a partial deposit freeze last December, and
the peso devaluation a month after.


GLOBAL CROSSING: Chairman Asserts Innocence
Global Crossing Chairman Gary Winnick says he had no idea that
the Company's finances were deteriorating until after he sold a
sizeable amount of stock last year.

The Associated Press reports that Rep. Billy Tauzin, R-La.,
chairman of the investigative body said that Winnick's ignorance
on the Company's financial condition is "a little hard for to

Winnick acknowledged that he had daily conversations with the
Company's chief executive officer, Thomas Casey. Casey, who
participates in management discussions about revenue shortfalls,
did not appear at Tuesday's hearing because he was seriously ill,
according to committee spokesman Ken Johnson.

However, Winnick contends that he never learned of the Company's
problems until the Company's lawyer, James Gorton told him in
June 2001 that executives could no longer sell company stock
because of the changing financial health. Winnick had sold his
stock for US$123 million in late May.

Winnick even promised to donate US$25 million to company
employees who lost money when the stock plunged. This is to
offset the losses of employees whose retirement savings were
invested in company stocks.

Global Crossing filed for bankruptcy protection seven months
later, listing assets of US$22 billion. Its stocks collapsed, and
investors including company employees lost billions of dollars.

Winnick insists that there was no fraud and that the Company was
forced into bankruptcy because of the decline that affected the
telecommunications industry.

Two Asian Companies have bought global Crossing for US$250

          45 Reid Street, Wessex House
          Hamilton HM 12, Bermuda
          Phone: (441) 296-8600
          Fax: (441) 296-8606

          Becky Yeamans, +1-974-410-5857,

          Tisha Kresler, +1-973-410-8666

          Ken Simril, +1-310-385-5200

TYCO INTERNATIONAL: Probe Yet To Uncover Malpractices
Tyco International Ltd. Chief Executive Edward Breen said on
Monday that Forensic accountants have not yet uncovered any
problems in their investigation of the Company's books. A report
from Yahoo! Finance says that the accountants are almost halfway
through the probe.

"If there were something in there that was going to be very
serious or material, I think we would have an indication of that
by now," said David Boies of Boies Schiller & Flexner, the law
firm leading the internal inquiry.

Shareholders are relieved. Stocks have plunged after allegations
of how former top executives used company funds for extravagant
personal expenses were revealed.

The stock was up 3 percent, at about US$14 after the first two
hours of trading.

Tyco's accounting is under investigation after the Company's
former CEO Dennis Kozlowski, and ex-finance chief Mark Swartz
were charged of enterprise corruption and grand larceny for
allegedly stealing US$170 million of company funds. Some
expressed fear that such large-scale fraud may have involved some
accounting "magic".

But Breen declared yesterday, "We're about 40 per cent through
the [forensic accounting] review and we have not yet found
anything that would require additional disclosure."

The Company's new CEO launched a review of the conglomerate's
corporate governance, liquidity position, and business
operations, in a bid to restore shareholder confidence.

Breen also promised to agree new credit lines for the business
well ahead of a February deadline, as it might improve the
group's credit rating.

          The Zurich Center, Second Floor
          Pembroke HM 08, Bermuda
          Phone: (441) 292-8674


BRAZILIAN BANKS: Goldman Trims Ratings Amid Election Concerns
Mounting doubts that opposition candidate Luiz Inacio Lula da
Silva will win in the first round of Brazil's Oct. 6 presidential
election prompted Goldman Sachs to trim the ratings of three
largest locally owned private sector banks.

According to Dow Jones Newswires, the investment bank downgraded
the ratings of Banco Bradesco SA, Banco Itau SA and Unibanco-
Uniao de Bancos Brasileiros SA to "market performer" from "market
outperformer" reversing last month's decision to raise the banks
to outperformer status.

"A [da Silva] first-round win significantly increases the risks
of banks becoming 'the main variable of adjustment' of the new
administration's monetary- and debt-management policies,
particularly if difficulties recently encountered by the Central
Bank in rolling over US-dollar linked debt at reasonable rates
intensify next year," the investment firm said in a research

Also discouraging was a recent statement made by Mr. da Silva in
which he said, if elected, he would replace Central Bank Governor
Arminio Fraga, who is "regarded as one of the anchors of
stability of the current administration," Goldman said.

          Jean Philippe Leroy
          Technical Director of Investor Relations
          Tel: (11) 3684-9229

          Bernardo Garcia
          Executive Manager of Investor Relations
          Tel: (11) 3684-9302

          BANCO ITAU, S.A.
          Rua Boa Vista, 176
          01014-919 Sao Paulo, Brazil
          Phone: +55-11-3247-3000
          Fax: +55-11-5582-1133
          Olavo Egydio Setubal, Chairman
          Robert Egydio Setubal, President and CEO
          Henri Penchas, SVP Accounting & Control Area

          Avenida Eusebio Matoso, 891, 22nd Fl.
          05423-901 Sao Paulo, Brazil
          Phone: +55-11-3097-1313
          Fax: +55-11-3813-6182
          Pedro Moreira Salles, Chairman
          Geraldo Travaglia Filho, Executive Director and CFO

CSN: BNDES Hires UK Law Firm To Study Corus Merger
A British law firm was hired to analyze the planned merger
between Rio de Janeiro-based flat steel maker CSN and Anglo-Dutch
group Corus, relates Business News Americas.

Brazil's state-owned development bank BNDES, which hired the law
firm, believes that the move was relevant because the merger
incorporates many elements of English law, said Eduardo Gentil,
director of the bank's structured products.

The firm will represent not only BNDES but also pension fund
Previ and Brazilian bank Bradespar, both of which also lent money
to Brazil's Vicunha group to acquire control of CSN.

Vicunha's shares in CSN act as collateral for BNDES loans, and so
the bank is one of the state entities that need to give their nod
to the merger. Gentil said a decision on the operation will not
be taken until next year.

Meanwhile, recent reports have it that a group of CSN minority
shareholders are threatening to contest the planned operation,
arguing it is not at all a merger but an acquisition. And so, a
public tender offer should be made for the outstanding shares on
the market. As it stands, the operation involves an exchange of
shares in which CSN shareholders will retain 37.6% of the merged

The reported discontent came after CSN shareholders approved the
steel maker's acquisition of steel can maker Metalic. Disgruntled
shareholders say this operation could still be contested, too.

"The shareholders are still going to evaluate if some measure
will be taken," Waldir Correa, the president of the national
association of investors in the capital market, was quoted as

Minority shareholders could ask stock market watchdog CVM to
annul the measure approving the Metalic deal. These investors
want the regulatory authority to forbid controlling shareholders
from voting on cases such as Metalic's, because the Vicunha group
is the controller of both the can maker and its buyer CSN.

To see financial statements:

CONTACT:  Jose Marcos Treiger
          CSN - Investor Relations General Manager
          Tel. +55 21 2586 1442

* Brazil FM: Brazil Has No Reason to Restructure its Debt.
Brazil has no reason to restructure its US$335 billion public
debt, as a new president will be elected this month, according to
the country's finance minister, Pedro Malan.

In a television interview with Bloomberg, Malan said that
investors should have no reason to doubt Brazil's ability to
overcome the current turbulence.

Brazil's bonds and currency have plummeted since March on concern
that Worker's Party condidate Luiz Inacio Lula da Silva will win
the elections, triggering the country's default. Lula is ahead in
opinion polls, followed by his closest rival Jose Serra.
Elections will be held this Sunday.

Lula probably will win the election after a second round of
voting, Malan added.


AEROMEXICO: Wards Off Strike After Union Signs Contract
Aeromexico, one of Mexico's two major airlines, skirted a
potentially devastating strike this week, after a union
representing 745 pilots, reached a contract moments before their
scheduled walkout.

Citing airline spokesman Alejandro Iberri, the Associated Press
reports that pilots agreed to a 7% increase in salary and
benefits shortly before midnight Monday. The pilots had planned a
strike for Tuesday if a contract wasn't reached. The two-year
contract includes a 5.5% salary raise and a 1.5% increase in

Arturo Barahona, assistant director of the airline, told Mexican
news media that the pilots "were conscious of the economic
difficulties affecting the industry."

Aeromexico and Mexicana are Mexico's two largest airlines. Both
have been operated by a government-controlled holding company
since 1995 when the government seized the companies during an
economic crisis.

Both are now on the auction block.

In 1988, a strike forced Aeromexico to file for bankruptcy. The
airline was then sold to a group of investors for US$335 million.
Mexicana was sold a year later in an effort to help jump-start
Mexico's sagging economy.

          Mayte Sera Weitzman of AeroMexico, +1-713-744-8446, or

          Adolfo Crespo, V.P. of Public Affairs
          Division of Mexicana Airlines, +1-210-491-9764

CYDSA: Shakes Up Management To Improve Situation
Mexican chemicals and synthetic fibers maker Celulosa y Derivados
S.A. (CYDSA) is reorganizing its management and appointed Cesareo
Frias Mendoza to head up the reorganization, the Company said in
a filing with the Mexican Stock Exchange.

Citing the filing, Dow Jones reports that the move, aimed at
improving the Company's operations and finances, includes the
appointment of a director for its chemical and plastics division.
The Company will soon name someone to lead its textile and
packaging operations.

Cydsa has been hit by the economic recession in the U.S., where
90% of overall Mexican exports are sold, a weak local currency
and historically low prices for chemical, petrochemical and
textile products.

Last year, Cydsa decided to embark on a debt restructuring in an
effort to meet financial obligations, despite having sold off
several assets.

Cydsa reported sales in 2001 of roughly US$69.8 million on a cash
debt load of US$382 million. Its assets have a book value of
around US$1 billion

Based in Monterrey, Mexico, Cydsa maintains a presence in several
industrial sectors, including Chemicals and Plastics, Fibers and
Textile Products and Flexible Packaging.

          Jesus Montemayor, Treasury Director

GRUPO BITAL: Consummates Takeover of Atlantico
Mexico's Bank Savings Protection Institute (IPAB) announced that
Banco del Atlantico is no longer in its hands.

In a Reuters report, IPAB revealed that the country's fifth-
largest financial group Grupo Financiero Bital concluded its
takeover of Atlantico Tuesday.

"Today [Tuesday] the clean-up of Atlantico concluded and we
signed the contract under which Bital assumes the operations,
assets and liabilities of Atlantico," IPAB said in a news

Atlantico, which was under a mountain of bad debt, was taken over
by IPAB as part of a US$100-billion clean up of banks that
collapsed after a shock devaluation of the peso in late 1994 sent
interest rates soaring and defaults through the roof. The agency
put about US$887 million into cleaning up Atlantico, and assumed
some US$2.5 billion in the bank's debt.

Bital agreed to buy Atlantico four years ago, but the sale never
went through as Bital and the government disagreed over what
conditions Bital should meet. Bital contributed MXN1.678 billion
(about US$166 million) this year to clean up Atlantico. Most of
that came out of Bital's capital reserves as of March 31 this
year, and a small part will come as a charge against earnings in
the third quarter this year.

As part of the deal, Grupo Financiero Bital is obligated to
maintain a capitalization index of 10% in its Bital banking unit
as of Dec. 31, 2002.

The US$166 million Bital contributed to cleaning up Atlantico,
plus the estimated capital injection Bital required to maintain
its capitalization index at the 10% level, add up to MXN2.634
billion (about US$260 million), IPAB said in a statement.

Bital will also have to reimburse IPAB an unknown amount of money
for administering Atlantico, which will be determined by an audit
in the future.

          Paseo De La Reforma
          No. 243, Cuauhtemoc,
          06500, Mexico ,D.F.
          Home Page:
          Investor Relations
          Act. Ricardo Garza Galindo Salazar


BLADEX: Plans Recapitalization Following Argentine Losses
Banco Latinoamerianco de Exportaciones (Bladex) will embark on a
recapitalization after incurring losses of US$300 million during
the first half of this year due to its exposure to Argentina.

As part of the measure, the bank will issue US$100 million worth
of shares, probably in October, Bladex first VP Carlos Yap told
Panamanian daily La Prensa.

Yap revealed that the Company has hired BNP Paribas and Deutsche
Bank to advise on the capitalization and the new shares will
first be offered to Bladex's main shareholders.

Bladex increased its loan loss reserves from US$255 million to
US$557 million this year due to the volatility of Argentina and
other Latin American markets, resulting in a capital reduction
from US$598 million at year-end 2001 to US$291 million at the end
of June this year.

Bladex specializes in foreign trade operations in Latin America
and was created by the central banks of Latin America and the
Caribbean. The bank has the shareholder participation of 23
countries of the region, represented by central banks and
commercial banks as well as
international banks and private investors.

          Head Office
          Calle 50 y Aquilino de la Guardia
          Panama City, Panama
          Attention: Carlos Yap, VP - Finance & Performance Mgt.
          Tel. No. +1-507-210-8581


MINERA VOLCAN: Workers' Strike Creating More Losses
Already battling with losses due to weaker zinc prices, Peruvian
zinc miner Minera Volcan braces for more losses.

About 500 workers out of 2,500 at Volcan's Yauli mine went on
strike early this week to demand a pay raise of PEN4 (US$1.10) a
day, said Victor Gobitz, Volcan's operations manager.

"We are failing to produce about 400 metric tons of zinc
concentrates per day," Gobitz said, adding, "That would represent
between US$80,000 and US$100,000 per day."

Volcan reported a net loss of PEN16.2 million (US$4.5 million) in
the first-half of this year, compared to PEN623,000 in net
earnings a year earlier. The Company lost PEN35 million last

The Company said last month it cut its short-term need for cash
to meet debt payments after refinancing US$110 million in
borrowings to extend its maturity by five years with a grace
period of 18 months.

The strike at the Yauli mine is the second this year at Volcan
mines. In May, workers at Volcan's Paragsha mine, the Company's
biggest, went on strike for 12 days in May to demand higher pay.


EDC: Obtains $47.5M Worth of Syndicated Loan
Electricidad de Caracas (EDC), the Venezuela subsidiary of AES
Corp., signed a syndicated bank loan agreement Friday with Morgan
Chase, Dresdner Banque Nationale de Paris and ING Barings for
US$47.5 million, Business News Americas reports, citing EDC
investor relations director Juan Azpurua.

Loan terms and conditions were not revealed. But, according to
Azpurua, the funds would be used for the upgrading and
maintenance of existing infrastructure.

In August, EDC also obtained a seven-year, US$25-million loan
from U.S. Export Import bank. The fund was allotted for the
purchase of equipment and material.

EDC registered a loss of VEB63.7 billion in the first-half of
this year, compared to a profit of VEB32.4 billion in the same
period in the previous year.

          Avenida Rio de Janeiro
          Qta. Tres Pinos
          Chuao, VE-1061 Caracas, Venezuela
          Phone: +58 14 929 2552
          Fax: +58 2 9937296
          Contact: Elmar Leal, Chairman
          Juan Font, Vice Chairman


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.

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