TCRLA_Public/030611.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

          Wednesday, June 11, 2003, Vol. 4, Issue 114

                           Headlines



A R G E N T I N A

BANCO FRANCES: Losses Continue, Credit Demand Key to Rebound
BHN IV: Standard & Poor's Moves Trust To `Junk' Status
CENTRAL COSTANERA: Cash Hemorrhaging Continues
DE PAOLA HERMANOS: Seeking Reorganization
FIDEICOMISO CREDICUOTAS: Local S&P Assigns Default Ratings

JUAN MINETTI: IFC Confirms Debt Proposal Acceptance
MOLINOS RIO: Acquires Remaining 39% of Nieto Senetiner For $4.5M
NATFROZ: Court Orders Liquidation
NOVOGRAF: Creditors Demand Bankruptcy Declaration
PERKINS ARGENTINA: Under Receivership

PETROBRAS ENERGIA: Tells Bourse It Will Buy Back $7.8M Bonds
REPSOL YPF: Currently Values Argentine Unit at $18.1B
SIDECO AMERICANA: Seeks Approval To Execute APE
SOLAVI: Seeks Court's OK for Reorganization
TC/CAP: Evaluadora Rates Financial Trust `C'

TELEFONICA DE ARGENTINA: Names New Chairman
TGS: Evaluadora Issues Junk Ratings
TRUCK SERVICE: Creditor Seeks Involuntary Bankruptcy


B R A Z I L

FIBERCORE: Nasdaq Declares Additional Deficiency for Listing
GERDAU: North American Unit announces $750M Refinancing
SABESP: S&P Rates $200M Senior Unsecured Notes 'B+'
TELEMAR: In Merger Talks With Brasil Telecom, TIM


D O M I N I C A N   R E P U B L I C

BANCO POPULAR DOMINCANO: S&P Drops Ratings to 'B+', Outlook Neg.
CENTENNIAL COMMUNICATIONS: Plans Private Placement of Sr. Notes
* S&P Cuts Dominican Republic's Long-Term Rating


E C U A D O R

PETROECUADOR: Workers Strike Over Association Contracts Proposal


M E X I C O

PEMEX: Reduces Natural Gas Shipments To Independencia Plant
PEMEX: Pipeline Explosion Not A Maintenance Mistake


P E R U

AMERICA TV: Creditors Approve Debt Restructuring Plan


T R I N I D A D   &   T O B A G O

BWIA: Union Head Blames Contract With UK Firm For Soaring Costs


V E N E Z U E L A

PDVSA: Signs Cooperation Framework Accord With CVG
REPSOL YPF: Plans $700M Venezuelan Expenditure in Next 5 Years


     - - - - - - - - - -

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

BANCO FRANCES: Losses Continue, Credit Demand Key to Rebound
------------------------------------------------------------
Banco Frances BBVA S.A., which plunged deeper into the red with a
net loss of ARS154 million ($1=2.825) in the first quarter of
2003, from a net loss of ARS42.1 million in the same period a
year earlier, may see profits again in 2005, according to the
head of the Latin American operations of Spain's Banco Bilbao
Vizcaya Argentaria S.A. (BBVA).

Banco Frances is the Argentine-listed unit of BBVA.

Citing an interview with Argentine newspaper El Cronista, Dow
Jones reports that BBVA director general for Latin America
Vitalino Nafria Aznar said in Madrid that the Argentine company
was well placed to return to profit but that there needed to be a
pickup in the demand for credit in the country.

"The operating structure is ready to be profitable. Now what's
fundamental is to see what happens with the demand for credit,"
Nafria Aznar said.

Aznar added, however, that the return of credit, which has
essentially dried over the past two years, is dependent on the
government delivering a promised compensation package to
Argentina's banks that resolves the damage done to their balance
sheets by last year's "asymmetric" conversion of dollar-
denominated loans and deposits into devalued pesos.

Banco Frances is one of Argentina's largest private banks, with
13.6% of total deposits in the banking system, as of March 31.
The bank reported total assets of ARS15.3 billion and total
liabilities of ARS13.4 billion.

CONTACT:  BBVA Banco Frances SA
          199 Reconquista
          Buenos Aires
          Argentina 1003
          Phone: +54 11 4346 4000
          Home Page: http://www.frances.com.ar
          Contacts:
          Jaime Guardiola Romajaro, Chairman


BHN IV: Standard & Poor's Moves Trust To `Junk' Status
------------------------------------------------------
Standard & Poor's International Ratings, Ltd. Sucursal Argentina
moves BHN IV's debt security to junk territory. The National
Securities Commission of Argentina relates that a total of more
than US$200 million of financial trust were affected.

S&P assigned `raD' ratings to US$156 million worth of debt
security called "Serie AV/AF" due in April 2000, and US$24.4
million of "serie B" debt security of undisclosed maturity date.
According to the ratings agency a `raD' rating is assigned to
obligations that are currently in payment default, or when the
obligor has filed for bankruptcy.

At the same time, US$14.6 million of Participation Certificates
were rated `raC' by the same ratings agency. The rating means
that the Company has taken steps towards a bankruptcy petition,
but payments on this obligation is still being made.


CENTRAL COSTANERA: Cash Hemorrhaging Continues
----------------------------------------------
Argentina thermo generator Central Costanera is expected to lose
around US$1.2 million a month from June due to a power contract
dispute between Brazil's Parana state and the 2,000MW Cien
interconnection project between Argentina and Brazil, reports
Business News Americas, citing Costanera's finance manager
Eduardo Lopez Cano.

Business News Americas recalls that Costanera has two contracts
with Cien. One is to supply 75%, or 750MW, of the first 1,000MW
interconnection. The second is to supply 34%, or 344MW, of the
other 1,000MW interconnection.

Costanera is receiving 100% of the payment for the first contract
from Cien. But beginning this month, Costanera will receive
payment for only 20%, or 79MW, of the second contract, which is
signed through the Argentine wholesaler Comercializadora de
Energia del Mercosur (Cemsa).

This, after Parana governor Roberto Requiao froze payments for
all of the 800MW state power company Copel is contracted to buy
from Cien.

Cien's contract is to sell power to Copel at US$29/MWh, but
Requiao wants to terminate the contract because high water levels
in Brazilian hydro plants has sent spot market prices down to
around 4 reais/MWh.

As a result, Costanera's monthly income of US$6 million from its
Cien contracts will go down to just US$4.8 million.

But Cano expressed confidence that Copel should meet its
contractual obligations regardless of the domestic power price in
Brazil.

Endesa Chile, which owns 45% of the Cien project, is considering
legal options in its standoff with Requiao. Endesa Chile's parent
company Endesa Spain owns the remaining 55% of Cien.


DE PAOLA HERMANOS: Seeking Reorganization
-----------------------------------------
De Paola Hermanos S.A. has applied for "concurso preventivo" at
Lomas de Zamora Court NO. 14, under case number 30520273413.
The Company, which is involved in the production of milk and
milk-related products, is seeking permission to reorganize
itself.

The Court assigned Mr. Carlos A. Ceccarelli as receiver for the
proceedings. Mr. Ceccarelli is instructed to present the
individual report on August 12, 2003, while the general report is
due on September 22, 2003.


FIDEICOMISO CREDICUOTAS: Local S&P Assigns Default Ratings
----------------------------------------------------------
A total of more than US$10 million of Fideicomiso Credicuotas III
financial trust were assigned with default ratings by Standard &
Poor's International Ratings, Ltd. Sucursal Argentina.

The financial trusts include US$4.8 million worth of
Participation Certificate Class B and US$5.9 million worth of
Participation Certificate Class C. Both securities mature on
February 25, 2005.

The rating means that the debt is in payment default or the
obligor has filed for bankruptcy, said the ratings agency.


JUAN MINETTI: IFC Confirms Debt Proposal Acceptance
---------------------------------------------------
Argentine cement firm Juan Minetti SA announced Friday it had
completed a debt restructuring process after getting the approval
of creditors representing 99.3% of its debts. Dow Jones discloses
that one of the creditors, who accepted the debt-restructuring
offer, is the International Finance Corporation (IFC), the
private sector investment arm of the World Bank.

The IFC confirmed in a statement Monday that it agreed to
restructure some US$169.9 million that Juan Minetti owed it. The
debt comes from two loans the IFC gave the cement firm and a
further syndicated loan in which the agency took part.

The statement said the restructuring would help Juan Minetti
reduce its debts from US$276 million to some US$101.5 million.

Under the restructuring, Juan Minetti agreed to pay its
creditors, mainly banks, 48.6% of the debt it owed them within
three working days.

In addition, the Company promised that within three working days,
it would pay its creditors the money owed them from a cash tender
offer, aimed at rescuing some US$45.4 million in debt.

These two payments will be made thanks in part to a loan from the
Company's majority shareholder Cemasco B.V., which is a
subsidiary of European firm Holcim Ltd..

In return, the Company received an extension of maturities on
debt falling due in the coming years. The Company also promised
to settle debt payments earlier than agreed, if the Company has
sufficient liquidity to do so.

CONTACT:  Juan Minetti SA
          87 Ituzaingo
          Cordoba
          Argentina  5000
          Phone: +54 51 26 7529
          Fax:  +54 51 24 4709
          Home Page: http://www.juanminetti.com.ar
          Contacts:
          Dr. Manuel Augusto J. Baltazar Ferrer, Chairman
          Atty. Carlos Buhler, Executive Vice Chairman & General
                                     Manager


MOLINOS RIO: Acquires Remaining 39% of Nieto Senetiner For $4.5M
----------------------------------------------------------------
Molinos Rio de la Plata S.A., Argentina's largest branded food
products manufacturer, confirmed Monday that it has acquired the
39% that it did not already own in Argentine winery Bodegas Nieto
Senetiner, reports Dow Jones.

The stake, which Molinos paid for US$4.5 million, belonged to
CDPQ Mercosur Inc., a Canadian company controlled by Caisse de
Pensions de Quebec.

Dow Jones recalls that Molinos acquired 60% of the winery in
February last year, purchasing it from Perez Companc S.A. (PC),
which owns a majority stake in Molinos, as part of a broad
consolidation of Perez Companc's food and agriculture interests
under the Molinos umbrella.

Petroleo Brasileiro S.A. purchased a controlling 58.6% stake in
Perez Companc in October 2002.

TCR-LA earlier reported that Fitch removed the Rating Watch
Negative on the 'CC' senior unsecured local currency rating and
on the 'B-' rating on the senior secured export notes (SENs)
issued by Molinos.

The rating action reflected Molinos' ability to earn dollar-based
revenues through export sales, which in 2002 reached US$306
million (or 51% of total revenues) compared to US$153 million (or
25% of total revenues) in 2001.

Molinos' ratings continue to be constrained by the difficult
economic and operating environment in Argentina, weak domestic
demand, difficulty to pass cost increases onto consumers and high
risk of political interference.

The ratings also reflect the volatility of international oilseed
prices, which affect Molinos' export revenues, and the company's
foreign currency exposure resulting from its mostly dollar-
denominated debt.


NATFROZ: Court Orders Liquidation
---------------------------------
Buenos Aires Court No. 8 declared that Argentine food company
Natfroz SRL be put under "Concurso Mercantil Liquidatorio" under
case number 30705073283.

Furthermore, the court assigned Mr. Alberto Francisco Romeo, as
receiver for the process. Mr. Romeo is expected to submit the
individual reports on August 15, and the general report on
September 26.

Infobae reports that the deadline for verification of claims is
June 18, 2003.

The Company is involved in the distribution of frozen meet and
vegetables.

CONTACT:  NATFROZ S.R.L.
          Email: info@natfroz.om
          Home Page: http://www.natfroz.com

          Mr. Alberto Francisco Romeo
          275 Parana
          Buenos Aires
          Argentina


NOVOGRAF: Creditors Demand Bankruptcy Declaration
-------------------------------------------------
The Buenos Aires Court No. 24, under Dr. Ballerini, declared
Novograf Impresores S.A. bankrupt at the behest of Pilarpel S.A..
Novograf owes Pilarpel about US$17,304.60.

Mr. Jorge Byrne has been assigned receiver for the bankruptcy
process. The deadline for verification of claims is July 18,
2003.

CONTACT:  NOVOGRAF IMPRESORES S.A.
          1st Floor No. 2686
          Mansilla Street
          Buenos Aires
          Argentina

          Mr. Jorge Byrne
          8th Floor No. 2358
          Venezuela Street
          Buenos Aires
          Argentina


PERKINS ARGENTINA: Under Receivership
-------------------------------------
Buenos Aires Court No. 9 rules that carmaker Perkins Argentina
SAIC be put under receivership, relates Infobae, without
revealing the name of the receiver.

According to the report, the Company's "concurso preventivo"
proposal, case number 30502556653 is handled by Secretary no. 17
of Buenos Aires.


PETROBRAS ENERGIA: Tells Bourse It Will Buy Back $7.8M Bonds
------------------------------------------------------------
Argentine energy company Petrobras Energia announced it will buy
back US$7.8 million of dollar-denominated series O debentures
issued in March, the Company informed the Buenos Aires stock
market of the plan, without giving a reason for the decision.

Business News Americas recalls that Petrobras Energia, formerly
Pecom Energia, placed US$33 million in one-year debentures
denominated in US dollars and Argentine pesos, to pay part of a
US$35 million bond payment due on March 21.

The dollar-denominated series O debentures were for US$29.2
million and pay 7.5% annual interest, while the US$3.6 million
peso or dollar denominated series P pays 8.5% annual interest.

The bond issue was the first for Pecom Energia since its parent
company Perez Companc was bought out by Brazil's state owned oil
company Petrobras in October 2002.


REPSOL YPF: Currently Values Argentine Unit at $18.1B
-----------------------------------------------------
Repsol YPF now values its Argentine subsidiary-YPF at US$18.1bn,
after buying it for US$15 billion in 1999, Spanish newspaper
Expansion reports. The calculations are based on the price that
Brazil's federal energy company Petrobras paid for 58.6% of
Argentina's Perez Companc. The market is not as optimistic, and
places a lower value on YPF because of Argentina's economic woes,
says the newspaper.


SIDECO AMERICANA: Seeks Approval To Execute APE
-----------------------------------------------
The construction firm Sideco Americana, domiciled in 299 Carlos
Maria Della Paolera St., 27th floor, is seeking approval to
execute an out-of-court agreement (APE) reached with its
creditors. The case is in court Nø 18, secretariat Nø 36.

According to the APE proposed to financial entities and
bondholders, Sideco will settle a debt of ARS520 million
(US$184.40 million) with an average cut of 50% and an up to
eight-year term.

The Company would have agreed with creditors that represent 80%
of its banking and commercial debt and 40% of the debt with
bondholders.

The restructuring of Sideco's debt will have a positive impact on
the liabilities of most of the firms wherein Sideco holds a
majority shareholding.

Sideco holds a majority stake in the postal services firm Correo
Argentino, LIPSA (energy transmission), Crearurban (real estate
developments), Pago Facil (collection services), Servicios Viales
(toll concessionaire) and Sideco Brazil.

It also has a 10% ownership in the toll concessionaire Autopistas
del Sol (Ausol).


SOLAVI: Seeks Court's OK for Reorganization
-------------------------------------------
Argentine transport company Solavi S.A. is seeking permission
from a Court to start its reorganization process, reports local
news portal Infobae.

The Company filed case number 30624483924 at Court No. 10,
Secretary No. 40 of Buenos Aires. The Court assigned Mr. Abraham
Alberto Forman as receiver for the proceedings.

Verification of claims is until July 14, 2003. The receiver is
expected to present the individual reports on September 8, 2003
and the general report on October 20, 2003.

The informative assembly is scheduled for March 22, 2004.

CONTACT:  SOLAVI S.A.
          570 Presidente Roque Saenz Pena
          Buenos Aires
          Argentina

          Mr. Alberto Abraham Forman
          64 Carabobo
          Buenos Aires
          Argentina


TC/CAP: Evaluadora Rates Financial Trust `C'
--------------------------------------------
Ratings agency Evaluadora Latinoamericana S.A. Calificadora de
Riesgo rates TC/Cap Fideicomiso Financiero's financial trust `C',
according to an announcement from the National Securities
Commission of Argentina. The rating applies to a total of US$3.9
million of Participation Certificates, which mature on January
25, 2005.

The rating, issued last Monday, shows that the Company's capacity
to meet its obligations on this security is low. This rating is
assigned to entities that may have future problems to be overcome
in the medium term.


TELEFONICA DE ARGENTINA: Names New Chairman
-------------------------------------------
Telefonica de Argentina informed the Argentine stock exchange
Friday that it has named Mario Eduardo Vazquez as its new
chairman, relates Business News Americas. Vazquez will replace
Miguel Angel Gutierrez, who has been appointed a board member of
Telefonica Internacional (TISA) - the holding company for the
Telefonica group's Latin American fixed line operators.

Citing a statement sent to the bourse, Business News Americas
reports that Gutierrez will continue as a company director and
will be responsible for "regional and international issues" at
TISA.

Telefonica de Argentina is an operating company that provides
local-exchange, long-distance, residential Internet access and
directory publishing services in Argentina.

CONTACT:  Telefonica de Argentina SA
          18/F
          1 Tucuman Street
          Buenos Aires
          Argentina
          Phone: +54 11 4334 5530
          Home Page: http://www.telefonica.com.ar
          Contacts:
          Miguel Angel Gutierrez, Chairman
          Antonio Viana-Baptista, Vice Chairman


TGS: Evaluadora Issues Junk Ratings
-----------------------------------
Corporate bonds issued by Transportadora de Gas del Sur S.A. were
assigned junk ratings by Evaluadora Latinomaericana S.A.
Calificadora de Riesgo. The National Securities Commission of
Argentina shows that a total of US$800 million of bonds were
rated `D'. The rating, based on the Company's finances as of
March 31, 2003, means that the Company does not have the capacity
to meet its obligations on the debt.

The affected bonds include US$500 million worth of "Programa
Global de 1996 por U$S 500.000.000" and US$300 million of
"Programa Global de 2000." Both bonds were classified under
"program". However, their maturity dates were not indicated.

Also, the same ratings agency assigns a `4' rating to the
Company's stocks, which are described as "Acciones Ordinarias en
Circulaci¢n Clase "B" de 1 voto c/u, V/N $1". The rating means
that such stocks have a low profit-generating capacity and has
average liquidity.

Transportadora de Gas del Sur (TGS), like other Argentina-based
firms has been hurt by that country's economic slump. The company
delivers more than 60% of natural gas used in Argentina through
the nation's largest pipeline system (4,300 miles).

Formerly state-run, TGS holds an exclusive license to transport
gas from southern and western Argentine sources to distributors
nearby and in the Buenos Aires metro area. TGS's gas services
include treatment, processing, and liquefied petroleum gas (LPG)
marketing. It is also building a fiber-optic network. The firm is
70%-owned by Compa¤¡a de Inversiones de Energ¡a, which is jointly
controlled by Perez Companc and troubled US energy giant Enron.

CONTACT:  TRANSPORTADORA DE GAS DEL SUR S.A.
          Don Bosco 3672, 6th Fl.
          C1206ABD Buenos Aires
          Argentina
          Phone: +54-11-4865-9050
          Fax: +54-11-4865-7154
          Homa Page: http://www.tgs.com.ar


TRUCK SERVICE: Creditor Seeks Involuntary Bankruptcy
----------------------------------------------------
A creditor of Argentine company Truck Service S.A. is asking a
court to declare the Company under bankrupt. A local source
relates that N‚stor Maciel, to whom the Company owes some
ARS15,447.41 is asking Buenos Aires Court No. 19, under Dr.
Fernandez, to declare Truck Service as bankrupt.

The Court assigned Mr. Juan Poggio as receiver, said the source.
Claims will be verified until July 15, 2003.

CONTACT:  TRUCK SERVICE S.A.
          No. 2061 Guayra Street
          Buenos Aires

          Mr. Juan Poggio
          No. 3870 Aranguren Street
          Buenos Aires



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

FIBERCORE: Nasdaq Declares Additional Deficiency for Listing
------------------------------------------------------------
FiberCore, Inc. (Nasdaq: FBCE), a leading manufacturer and global
supplier of optical fiber and preform for the telecommunication
and data communications markets, announced Monday that on May 30,
2003 it had received a notification of "additional deficiency"
from Nasdaq. The Company was notified that it fails to comply
with the Nasdaq SmallCap Market requirement that it maintain
either shareholders' equity of at least $2.5 million, market
value of listed securities of at least $35 million, or net income
from continuing operations requirements of at least $500,000 for
the two most recent fiscal years, as well as its failure to file
its annual report on Form 10-K on a timely basis for continued
listing, and that as a result its securities are subject to
delisting from the Nasdaq SmallCap Market.

Based on the Form 10-Q for the period ended March 31, 2003, the
Company's stockholders' equity was $903,000. In addition, as of
May 29, 2003, the market value of listed securities was
$10,331,414. Finally, in its annual filings, the Company reported
a net loss from continuing operations of ($31,077,000), net
income from continuing operations of $480,000, and net loss from
operations of ($2,697,000), for the years ended December 31,
2002, 2001 and 2000, respectively.

The Company appeared before a Nasdaq hearing panel on May 22,
2003 where it explained its deficiency in regards to compliance
with the Nasdaq SmallCap Market listing requirements including
the aforementioned financial thresholds. At this hearing, the
Company explained how it intends to comply with the Nasdaq
listing requirements and requested sufficient time to implement
its revised business and financial plan. A final determination by
Nasdaq is expected shortly. There can be no assurance that the
Company will not be delisted from the Nasdaq SmallCap market.

If the Company is delisted, it would suffer material adverse
consequences. If the Company should be delisted, the Company will
endeavor to facilitate the trading of its stock on the OTC
Bulletin Board, but no assurance can be given that such a trading
market will be available. FiberCore previously traded on the OTC
Bulletin Board before moving to the Nasdaq Smallcap Market in
November 2000.

FiberCore, Inc. develops, manufactures, and markets single-mode
and multimode optical fiber preforms and optical fiber for the
telecommunications and data communications markets. In addition
to its standard multimode and single-mode fiber, FiberCore also
offers various grades of fiber for use in laser-based systems up
to 10 gigabits/sec, to help guarantee high bandwidths and to suit
the needs of Feeder Loop (also known as Metropolitan Area
Network), Fiber-to-the Curb, Fiber-to-the Home and Fiber-to-the
Desk applications. Manufacturing facilities are presently located
in Jena, Germany and Campinas, Brazil.

CONTACT:  Phone: 508-248-3900
          FAX: 508-248-5588
          E-Mail: sales@FiberCoreUSA.com
          Or investor_relations@FiberCoreUSA.com
          Website: www.FiberCoreUSA.com


GERDAU: North American Unit announces $750M Refinancing
-------------------------------------------------------
Gerdau S.A. (Bovespa: GGBR, NYSE: GGB and Latibex: XGGB)
disclosed that its subsidiary in North America, Gerdau AmeriSteel
Corporation (TSX:GNA.TO), has announced the intention of
accessing the capital markets by means of two financial
operations as per the press release divulged today and reproduced
below.

"GERDAU AMERISTEEL CORPORATION ANNOUNCES $750 MILLION REFINANCING

TORONTO, ON, June 9, 2003 - Gerdau Ameristeel Corporation
(TSX:GNA.TO) announced today that it intends to raise $400
million through a private offering of Senior Notes due 2011.
Contemporaneously with the offering of Senior Notes, the company
also intends to enter into a senior secured credit facility
providing commitments of $350 million. Gerdau Ameristeel will use
the net proceeds of the offering of Senior Notes and the initial
draw-down under the senior secured credit facility to repay debt
under its existing credit facilities. Once the company completes
the refinancing, it plans to reorganize its subsidiaries to more
efficiently integrate its operations and bring its U.S.
operations within the same U.S. group. The Senior Notes have not
been and will not be registered under the U.S. Securities Act of
1933 and may not be offered or sold in the United States absent
such registration or an applicable exemption from registration
requirements. The issuance will be offered to qualified
institutional buyers in reliance on Rule 144A under the
Securities Act and outside the United States in compliance with
Regulation S under the Securities Act."

CONTACT:  Press Office: +55(51) 3323-2170
          Email: imprensa@gerdau.com.br
          Website: www.gerdau.com.br


SABESP: S&P Rates $200M Senior Unsecured Notes 'B+'
---------------------------------------------------
Standard & Poor's Ratings Services assigned Monday its 'B+'
rating to Companhia de Saneamento Basico do Estado de Sao Paulo's
(SABESP) US$200 million senior unsecured notes due in 2008. The
ratings on SABESP reflect the risks of operating in the volatile
economic environment in Brazil, the lack of a defined regulatory
framework for the water utility sector, and significant
refinancing needs in 2003. At the same time, Standard & Poor's
affirmed SABESP's 'BB-' local currency and 'B+' foreign currency
ratings, as well as its 'brA' national scale rating. The proceeds
will be applied to refinance SABESP's US$200 million Euronotes
due in July 2003. SABESP is the largest water and sewage company
in the Americas and the third largest in the world, in terms of
clients.

"The negative outlook on the local currency rating reflects our
concern about SABESP's high refinancing needs in a still
unfavorable credit environment for Brazilian corporates. Besides,
the company's significant exposure to currency mismatches can
drastically worsen its cash flow protection measures in times of
strong volatility," said credit analyst Juliana Gallo. "If the
company successfully renegotiates its large debt maturities in
2003, namely the US$200 million Euronotes and the put on local
debentures in October, the local currency outlook can be revised
from negative to stable," continued Ms. Gallo.

An additional risk to SABESP includes the ongoing challenge to
reduce overdue customer receivables, specifically from water
wholesale to municipalities. The risks are partially mitigated by
SABESP's strategic importance as a regional provider of water and
wastewater service in the state of Sao Paulo, covering a large
and broad territory with virtual monopoly for service and its
capacity to progress in the capital program that allows
comprehensive coverage of water service as well as expanded
wastewater collection and treatment capability throughout the
system.

SABESP registered an improved financial performance in the first
quarter of 2003 compared to the same period last year. The
company recorded a growth of 10.8% in net operating revenues and
15.5% in cash generation (EBITDA) in the first three months of
the year 2003 compared to the same period of 2002. This growth is
due to a tariff increase of 8.22% in August 2002 and an increase
in sales volume of about 3.5% compared to the first quarter of
2002. The steady increase in volume is a positive indication that
demand has gradually been picking up since the end of the energy-
rationing program, which directly affected water consumption
while it was in place. SABESP registered a net income of BrR171.9
million in the period, compared to BrR111.3 million in 2002.

Projections for the year 2003 indicate that the company will show
an EBITDA improvement of 14%, or about BrR2.3 billion, as a
consequence of its tariff adjustment and an increase in sales
volume, as well as lower energy costs.

ANALYSTS:  Juliana Gallo, Sao Paulo (55) 11-5501-8948
           Milena Zaniboni, Sao Paulo (55) 11-5501-8945


TELEMAR: In Merger Talks With Brasil Telecom, TIM
-------------------------------------------------
Brasil Telecom and Telemar, two of Brazil's three incumbent fixed
line operators, and mobile operator Telecom Italia Mobile (TIM)
are in talks to merge operations, Brazilian paper O Estado de Sao
Paulo reports, citing Paulo Andreoli, a spokesperson for local
investment group Opportunity.

According to Business News Americas, Opportunity would be central
to the transaction as it has an 11.2% stake in Telemar, and an
indirect controlling stake of Brasil Telecom.

On the other side of the table, TIM parent Telcom Italia has a
19.9% stake in Brasil Telecom.

For now, a full-scale merger is impossible since Brazil's
telecommunications law prohibits the merger of two incumbents, as
well as the merger of two mobile operators from the same
concession region.

However, regulations could be loosened in the future, Andreoli
Business News Americas, adding that the worldwide trend shows
that mobile telecommunications markets can only support two to
three players maximum. Comparatively, each of Brazil's 10 mobile
operating regions have four mobile operators or licensed
concessions.

"All the telecoms companies [in Brazil] are in talks right now,
because it is a very opportune time to look for market
alternatives. Opportunity acknowledges that a possible merger
between Brasil Telecom, Telemar and TIM has existed for a long
time," Andreoli said.

CONTACT: TNE - INVESTOR RELATIONS
         Roberto Terziani
         Email: terziani@telemar.com.br
         Tel: 55 21 3131 1208

         Carlos Lacerda
         Email: carlosl@telemar.com.br
         Tel: 55 21 3131 1314

         Fax: 55 21 3131 1155



===================================
D O M I N I C A N   R E P U B L I C
===================================

BANCO POPULAR DOMINCANO: S&P Drops Ratings to 'B+', Outlook Neg.
----------------------------------------------------------------
Standard & Poor's Ratings Services said Monday that it had
lowered its long-term local and foreign currency counterparty
credit and certificate of deposit ratings on Banco Popular
Dominicano C por A to 'B+' from 'BB-', and removed the ratings
from CreditWatch, where they were placed on May 15, 2003; the
outlook is negative. At the same time Standard & Poor's affirmed
its 'B' short-term ratings on the bank.

The rating and outlook actions follow similar actions taken
Monday on the sovereign credit rating of the Dominican Republic
(B+/Negative/B).

ANALYSTS:  David Olivares, Mexico City (52) 55-5279-2006
           Ursula M Wilhelm, Mexico City (52) 55-5279-2007


CENTENNIAL COMMUNICATIONS: Plans Private Placement of Sr. Notes
---------------------------------------------------------------
Centennial Communications Corp. (NASDAQ: CYCL) announced Monday
that it is pursuing, subject to board approval, an offering of
approximately $250 million in aggregate principal amount of
senior notes due 2008 in a private placement transaction pursuant
to Rule 144A and Regulation S.

The net proceeds from the offering would be used to permanently
retire existing debt under the company's senior credit facility
and for general corporate purposes. The company is in discussions
with its lenders under its senior credit facility regarding an
amendment to the facility providing the company with additional
flexibility under the financial and other covenants in the
facility. The amendment would be contingent upon the closing of
the senior notes offering. There can be no assurance that either
the senior notes offering or the bank amendment will be
consummated.

The notes anticipated to be offered and sold will not be
registered under the Securities Act of 1933 and may not be
offered or sold in the United States absent such registration or
an applicable exemption from such registration requirements.

This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of
the notes in any jurisdiction in which such offer, solicitation
or sale would be unlawful prior to registration or qualification
under applicable securities laws, or absent the availability of
an exemption from such registration or qualification
requirements.

Centennial is one of the largest independent wireless
telecommunications service providers in the United States and the
Caribbean with approximately 17.1 million Net Pops and
approximately 929,700 wireless subscribers. Centennial's U.S.
operations have approximately 6.0 million Net Pops in small
cities and rural areas. Centennial's Caribbean integrated
communications operation owns and operates wireless licenses for
approximately 11.1 million Net Pops in Puerto Rico, the Dominican
Republic and the U.S. Virgin Islands, and provides voice, data,
video and Internet services on broadband networks in the region.
Welsh, Carson Anderson & Stowe and an affiliate of the Blackstone
Group are controlling shareholders of Centennial. For more
information regarding Centennial, please visit our websites at
www.centennialcom.com and www.centennialpr.com.


* S&P Cuts Dominican Republic's Long-Term Rating
------------------------------------------------
Standard & Poor's Ratings Services said Monday that it lowered
its long-term sovereign rating on the Dominican Republic to 'B+'
from 'BB-' and removed the ratings from CreditWatch with negative
implications, where they were placed on May 15, 2003. At the same
time, Standard & Poor's assigned a negative outlook to the
Dominican Republic. The short-term rating remains 'B'.

"The Dominican Republic's downgrade reflects continued economic
pressures due to the collapse of Banco Intercontinental S.A.
(BanInter), the country's third-largest bank, and to the
significant costs, both direct and indirect, associated with the
central bank's bailout," said credit analyst Richard Francis.
"The negative outlook reflects the continued uncertainty over the
net cost of the bailout, and the vulnerability of the financial
system as a result of poor banking supervision and regulation,"
he added.

According to Mr. Francis, fiscal performance is expected to
deteriorate significantly in 2003 as a result of the central
bank's bailout of BanInter, with the general government deficit
expected to rise to 9% of GDP in 2003 from just above 2% in 2002.
The Dominican Republic's general government interest burden as
measured by interest expenditure to revenue is expected to
approach 20% in 2003, up from just 7% in 2002, due to the large
deficit and sharp depreciation of the Dominican peso (nearly 30%
year to date).

"Real GDP growth is likely to slow significantly in 2003, to 0.5%
from nearly 4% in 2002, as a result of tight monetary conditions
and central government spending cuts, especially in capital
expenditure," Mr. Francis said. "The country's medium-term growth
prospects have likely diminished as well. Policymakers face
significant challenges in reestablishing macroeconomic stability
and domestic confidence," he noted.

Standard & Poor's said that greater-than-expected fiscal
slippage, additional problems in the banking sector, or a fall in
international reserves could lead to further downward pressure on
the ratings.



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

PETROECUADOR: Workers Strike Over Association Contracts Proposal
----------------------------------------------------------------
About 1,400 workers of Ecuador state oil enterprise Petroecuador
in Quito did not show up for work on Monday in protest of the
government's moves towards privatizing the oil industry, reports
Business News Americas. The strike follows the resignation of
Petroecuador chief Guillermo Rosero.

Faustin Valencia, president of the Fetrapec union, warned that
the strike would spread to other company offices throughout
Ecuador and affect Petroecuador's production.

The stoppage resulted in the interruption of crude supply at the
Guayaquil distribution station Tres Bocas.

The workers are reportedly asking for the resignation of energy
minister Carlos Arboleda over his proposal to award association
contracts to private companies. The workers see such contracts as
similar to "giving away the family jewels."

Local reports say that Mr. Rosero's resignation was due to
pressure from the government for his opposition of Mr. Arboleda's
contracts proposal.

The minister claims that the contracts are aimed at attracting
private investment.

Mr. Arboleda is also unpopular among Petroecuador's workers
because he introduced the public sector wage legislation that
would reduce the severance pay of workers who quit their jobs.

The Arboleda is calling for more talks in response to the strike.
He also warned that Ecuador president Lucio Gutirrez might impose
a state of emergency in the oil sector.



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

PEMEX: Reduces Natural Gas Shipments To Independencia Plant
-----------------------------------------------------------
Following the explosion of its gas pipeline in the state of
Veracruz, Mexican state oil company Petroleos Mexicanos said it
cut back shipments of natural gas to a petrochemicals plant to
free up supplies for industry and households, Bloomberg reports,
citing an article released by Platts. The article said Pemex will
send gas through another pipeline from the state of Veracruz in
the Gulf of Mexico coast to the state of Queretaro to supply
customers in central and western Mexico. This will reduce flows
to the Independencia petrochemicals plant in the state of Puebla.


PEMEX: Pipeline Explosion Not A Maintenance Mistake
---------------------------------------------------
Mexico's state oil company Petroleos Mexicanos (Pemex) said the
lack of maintenance was not the cause of the explosion of a
pipeline in Veracruz state. The Company defended that the
explosion was triggered by extreme weather conditions.

According to Pemex, the propane gas pipeline, buried three meters
deep, was unearthed after the Chiquito river in the Matrata
mountains overflowed its banks, relates Business News Americas.
Exposed, the pipeline burst.

Recent reports revealed four people have died, and about 60 more
were injured from the incident.

Pemex closed two pipelines after two other pipelines broke and
spilled some 5,000 barrels of oil, said Pemex Refinancion chief
Juan Bueno Torio on Saturday.

Mr. Torio added that the Company expects to have the five
affected pipelines back in working condition within three days.



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

AMERICA TV: Creditors Approve Debt Restructuring Plan
-----------------------------------------------------
Creditors of America TV, a television broadcaster in the Peruvian
capital, approved the Company's debt restructuring plan at a
meeting held just recently, reports South American Business
Information.

The plan calls for a new management structure, which will be
headed by Jose Antonio Miro Quesada, representing one of the
creditor companies - Grupo TV Peru SAC.

According to the new president, the new management will be
working on various fronts to achieve the recovery of the Company.
These include the administrative, technological and print
publication areas.

The outgoing president of America TV, Mr. Jose Tola, who has been
running the Company for 13 months, said that when he took the
position, its transmission system was close to collapse.

This has been remedied -- the signal quality has been regained
and the decline in advertising sales and ratings has been turned
around.

America TV has debts of over US$100 million and negative equity
of US$80 million.



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

BWIA: Union Head Blames Contract With UK Firm For Soaring Costs
---------------------------------------------------------------
The head of a union representing BWIA workers allege that the
airline's contract with a UK-based firm for maintenance services
only increased BWIA's operating cost. A report by the Trinidad
Guardian relates that Christopher Abraham, president of the
Aviation Communication and Allied Workers Union said that hiring
Staffhire to do maintenance work on BWIA was part of the
management's New Business Model 2003.

Claiming that he has a copy of the contract between the two
companies, Mr. Abraham reveals that BWIA was paying Staffhire
US$29 for aircraft third party maintenance, and US$40 in
transportation costs per employee per hour.

He added that BWIA is also paying US$85 for room and board per
hour for every employee Staffhire brings from abroad. These
expenses are "exponentially" increasing operation costs at the
cash-strapped airline, alleges Mr. Abraham.

The paper, however, was not able to get Staffhire's opinion on
the issue. Meanwhile, the report quotes a BWIA official as saying
Mr. Abraham's allegations were accurate.

"The whole point of outsourcing is that we couldn't justify
maintaining the number of (maintenance) staff year round for the
reduced work that we have. When we pay Staffhire, we pay
specially for the work done, rather than maintaining that same
number of employees for months on end to do the same amount of
work," said the official.

CONTACT:  BRITISH WEST INDIES AIRWAYS
          Phone: + 868 627 2942
          E-mail: mailto:mail@bwee.com
          Home Page: http://www.bwee.com/
          Contacts:
          Conrad Aleong, President and CEO (Trinidad)
          Beatrix Carrington, VP Marketing and Sales (Barbados)
          Paul Schutz, CFO (Trinidad)




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

PDVSA: Signs Cooperation Framework Accord With CVG
--------------------------------------------------
In an effort to find a solution to some contradictions existing
in the local market, Venezuela's top two state industry giants,
holding company CVG and oil producer PDVSA, signed a cooperation
framework agreement, Business News Americas reports, citing a CVG
statement.

Among the contradictions being cited by the report is CVG's
importation of caustic soda and pet coke for use in manufacturing
processes when these materials are already being produced in the
country and being exported by PDVSA.

At the same time, PDVSA has a motor launch manufacturing program
in which all the aluminum used is imported while CVG could
produce the type of metal required.

CVG's statement reveals that the agreement is set to run for
three years and is renewable.


REPSOL YPF: Plans $700M Venezuelan Expenditure in Next 5 Years
--------------------------------------------------------------
Miguel Angel Remon, VP for exploration and production at Repsol-
YPF, revealed that the Spanish oil company plans to invest US$700
million in Venezuela by 2008, reports Business News Americas.

During a Hispano-Venezuelan enterprise meeting organized by the
Spanish Financial Ministry, Remon said Repsol expects to increase
its oil production in Venezuela by at least 20% by 2008, from
100,000 barrels to 120,000-125,000 barrels per day.

Repsol, the second most important foreign private company in
Venezuela behind the US firm Chevron, has invested US$1.5 billion
in the country since it started operations there in 1996.



               ***********


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 Oona G. Oyangoren, Editors.

Copyright 2003.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
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Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Latin America subscription rate is $575 per half-year,
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or balance thereof are $25 each.  For subscription information,
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