TCRLA_Public/040720.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

             Tuesday, July 20, 2004, Vol. 5, Issue 142

                            Headlines


A N T I G U A   &   B A R B U D A

LIAT: Gets US$9.4mln Bailout Package Pledge


A R G E N T I N A

ASERRADERO AMERICAN: Bankruptcy Initiated by Court Order
BODEGA MARGUS: Court Approves Reorganization Plea
CINEARTEL S.A.: Liquidates Assets to Pay Debts
CLINICA PRIVADA: Court Rules on Liquidation
DEACA S.A.: Starts Liquidation Process

E.A.P. S.A.: Seeks Court Bankruptcy Protection
ECYME S.R.L.: To Liquidate Assets to Pay Debts
HALLS STARS: Seeks Court Authority to Reorganize
INSTITUCION EDUCATIVA: Judge Launches Liquidation Process
JUNIN 1721: Seeks to Restructure Debt

MARIO ROCHMAN: Court Reviews Insolvency Request
METALURGICA: Debt Payments Halted, Moves To Reorganize
S.B. MANDATARIA: Court Grants Reorganization Motion
SONIO S.A.: Court Issues Bankruptcy Ruling


B R A Z I L

EMBRATEL: Merrill Lynch Cuts Rating To Sell
NET SERVICOS: Clarifies Globopar Deal, Restructuring Plan


C H I L E

ENAMI: Mulls Quebrada Blanca Stake Sale
TELEFONICA CTC: Denies Movil Sale Will Affect Performance


C O L O M B I A

* Colombia Expects to Raise US$10B Via Asset Sales


C O S T A   R I C A

ICE: Contract Delays Create Continued Worries


H A I T I

* US$340M Available For Economic, Social Programs


H O N D U R A S

* IMF Says Honduran Economic Programs on Track


J A M A I C A

KAISER ALUMINUM: Quality Pays $315M for Alpart


M E X I C O

AHMSA: 1H04 EBITDA Up 474%
AHMSA: Taps Luis Zamudio as New CEO
PARMALAT MEXICO: Assets Acquired By Lala
PEMEX: May Get Petrobras Help In Gulf of Mexico Exploration


P E R U

AERO CONTINENTE: Seeks 60-day Government Guarantee


V E N E Z U E L A

PDVSA: Outlines Increased Oil Production Capacity
PDVSA: Executive Details 1H04 Exploration Budget Expenditures
PDVSA: Reports Oil Sales Earnings of US$13bln
PDVSA: Unit Reaches Agreement With ExxonMobil On Olefins Project


     - - - - - - - - - -

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

LIAT: Gets US$9.4mln Bailout Package Pledge
-------------------------------------------
To keep troubled airline LIAT afloat, the prime ministers of
Trinidad, Barbados, Antigua and St. Vincent have pledged on
Friday an XCD21.8-million (US$9.4 million) bailout package for
the Antigua-based airline, reveals the Associated Press. The
funds included XCD4.8 million (US$1.8 million) from Antigua to
pay off the airline's debt to the Antiguan government.

On the other hand, Barbados, St. Vincent, and Antigua each
pledged to give XCD5.7 million (US$2.1 million). Trinidad,
meanwhile, agreed to grant a five-year, XCD17-million (US$6.4
million) loan, at no interest, to help St. Vincent and Antigua
finance the bailout package.

The four countries, which met in Barbados Friday to discuss ways
to save LIAT, gave the airline until December to use the money
for restructuring its operations.


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

ASERRADERO AMERICAN: Bankruptcy Initiated by Court Order
--------------------------------------------------------
Aserradero American S.A.I.C. y C. will enter bankruptcy
protection after Buenos Aires Court No. 23, with the assistance
of Clerk No. 45, ordered the company's liquidation. The
bankruptcy order effectively transfers control of the company's
assets to a court-appointed trustee who will supervise the
liquidation proceedings.

Infobae reports that the court selected Mr. Salomon S. Wilhelm
as trustee. He will be verifying creditors' proofs of claims
until the end of the verification phase on September 7, 2004.

Argentine bankruptcy law requires the trustee to provide the
court with individual reports on the forwarded claims and a
general report containing an audit of the company's accounting
and business records. The individual reports will be submitted
on October 20, 2004 followed by the general report, which is due
on December 1, 2004.

CONTACT: Mr. Salomon S. Wilhelm, Trustee
         Lavalle 1290
         Buenos Aires


BODEGA MARGUS: Court Approves Reorganization Plea
-------------------------------------------------
Buenos Aires' Civil and Commercial Tribunal Court No. 2 has
approved the reorganization petition filed by Bodega Margus
S.R.L. Under insolvency protection, the Company will be able to
draft a settlement plan for its creditors so as to avoid
liquidation.

Creditors with outstanding claims against the Company must
submit proofs of these debts to the court-appointed trustee, Mr.
Antonio Gargulio, before the verification deadline on September
14, 2004.

The court has scheduled the submission of individual reports on
the case on October 26, 2004. The presentation of the general
report follows on December 7, 2004. Recognized creditors will
ratify the completed settlement plan during the informative
assembly on June 21 next year.

CONTACT: Bodega Margus S.R.L.
         Lavalle 2628
         Buenos Aires

         Mr. Antonio Gargiulo, Trustee
         Uruguay 385
         Buenos Aires


CINEARTEL S.A.: Liquidates Assets to Pay Debts
----------------------------------------------
Buenos Aires-based Cineartel S.A. will begin liquidating its
assets following the pronouncement of the city's Court No. 14
that the company is bankrupt, reports Infobae. The bankruptcy
ruling places the company under the supervision of court-
appointed trustee, Mr. Ruben Joaquin Toytoyndjian. The trustee
will verify creditors' proofs of claims until October 1, 2004.
Afterwards, the validated claims will be presented in court as
individual reports on November 15, 2004.

Mr. Toytoyndjian will also submit a general report, containing a
summary of the company's financial status as well as relevant
events pertaining to the bankruptcy, on December 29, 2004.

The bankruptcy process will end with the disposal company assets
in favor of its creditors.

CONTACT: Mr. Ruben Joaquin Toytoyndjian
         Roque Saenz Pe¤a 1219
         Buenos Aires


CLINICA PRIVADA: Court Rules on Liquidation
-------------------------------------------
Quilmes' Civil and Commercial Tribunal Court No. 4 has ordered
the liquidation of Clinica Privada Centro de Salud San Isidro
Del Sur S.R.L. after the company defaulted on its obligations,
Infobae reveals.

The pronouncement will effectively place the company's affairs,
as well as its assets, under the control of Ms. Perla Serra, the
trustee. Ms. Serra will verify creditors' proofs of claims until
August 13, 2004. The verified claims will serve as basis for the
individual reports to be submitted in court on September 29,
2004. The submission of the general report follows on November
12, 2004.

CONTACT: Clinica Privada Centro de Salud San Isidro Del Sur
S.R.L.
         Calle 359 Nro. 1435 Ranelagh (Berazategui)
         Quilmes

         Ms. Perla Serra, Trustee
         Alsina 180
         Quilmes


DEACA S.A.: Starts Liquidation Process
--------------------------------------
Deaca S.A. Ingenieria y Construcciones of Buenos Aires will
begin the bankruptcy process after the city's Court No. 11
declared the Company "Quiebra". Infobae reveals that the
bankruptcy process will commence under the supervision of court-
appointed trustee, Mr. Gerardo Miguel Seghezzo.

The trustee will review claims forwarded by the company's
creditors until September 15, 2004. After claims verification,
the trustee will submit the individual reports for court
approval on October 28, 2004. The general report submission will
follow on December 10, 2004.

Clerk No. 21 assists the court on this case.

CONTACT: Mr. Gerardo Miguel Seghezzo, Trustee
         Combate de los Pozos 129
         Buenos Aires


E.A.P. S.A.: Seeks Court Bankruptcy Protection
----------------------------------------------
Buenos Aires-based paper company E.A.P. S.A. filed a "Quiebra
Decretada" motion, reports La Nacion. The Company voluntarily
asked to enter bankruptcy after defaulting on its debt payments.

This case is pending before the city's Civil and Commercial
Tribunal Court No. 10, under Judge Chomer. Clerk No. 20, Dr.
Gigglberger, assists the court with the proceedings.

CONTACT: E.A.P. S.A.
         Ramon Falcon 1457
         Buenos Aires


ECYME S.R.L.: To Liquidate Assets to Pay Debts
----------------------------------------------
Ecyme S.R.L. proceeds with liquidation following the
pronouncement of the city's Court No. 11 that the company is
bankrupt, Infobae reports. The ruling places the company under
the supervision of court-appointed trustee, Mr. Gerardo Miguel
Seghezzo.

The trustee will verify creditors' proofs of claims until
September 16, 2004. The validated claims will then be presented
in court as individual reports on October 29, 2004. He will also
submit a general report, containing a summary of the company's
financial status as well as relevant events pertaining to the
bankruptcy, on December 13, 2004.

CONTACT: Mr. Gerardo Miguel Seghezzo, Trustee
         Combate de los Pozos 129
         Buenos Aires


HALLS STARS: Seeks Court Authority to Reorganize
------------------------------------------------
Judge Ottolenghi of Buenos Aires Civil and Commercial Tribunal
Court No. 4 is currently reviewing the merits of the
reorganization petition filed by Halls Stars S.A. Argentine
daily La Nacion reports that the company filed the request after
defaulting on its debt payments.

The reorganization petition, if granted by the court, will allow
the food company to negotiate a settlement with its creditors in
order to avoid a straight liquidation. Dr. Anta, Clerk No. 8,
assists the court on this case.

CONTACT: Halls Stars S.A.
         Senillosa 560
         Buenos Aires


INSTITUCION EDUCATIVA: Judge Launches Liquidation Process
---------------------------------------------------------
The Civil and Commercial Tribunal Court No. 1 of Mar del Plata
declared Institucion Educativa Colegio Jesus Redentor bankrupt,
reports Infobae. Ms. Elisa Tomattis, who has been appointed as
trustee, will verify creditors' claims until August 2, 2004 and
then prepare the individual reports based on the results of the
verification process.

The individual reports will be submitted in court on September
17, 2004, followed by the general report on November 5, 2004.
Clerk No. 1 assists the court on the case, which will close with
the liquidation of the Company's assets to repay creditors.

CONTACT: Institucion Educativa Colegio Jesus Redentor
         Espa¤a 1348
         Mar del Plata

         Ms. Elisa Tomattis, Trustee
         Catamarca 1434
         Mar del Plata


JUNIN 1721: Seeks to Restructure Debt
-------------------------------------
Junin 1721 S.R.L., a restaurant operating in Buenos Aires, has
requested for reorganization after failing to pay its
liabilities since May 15 this year. The petition, once approved
by the court, will allow the company to negotiate a settlement
with its creditors in order to avoid a straight liquidation.

The case is pending before Judge Bavastro of the city's Civil
and Commercial Tribunal Court No. 17. Dr. Trevino Figueroa,
Clerk of Court No. 33, assists on this case.

CONTACT: Junin 1721 S.R.L.
         Junin 1721
         Buenos Aires


MARIO ROCHMAN: Court Reviews Insolvency Request
-----------------------------------------------
Judge Fernandez of Buenos Aires Court No. 19 is now analyzing
whether to grant Mario Rochman y Raul Rochman Sociedad de Hecho
approval for its petition to reorganize.

La Nacion says that the textile company filed a "Concurso
Preventivo" motion following cessation of debt payments Since
June 10 this year. Clerk No. 38, Dr. Johnson, assists the court
on this case.

CONTACT: Mario Rochman y Raul Rochman Sociedad de Hecho
         Avenida Corrientes 2573
         Buenos Aires


METALURGICA: Debt Payments Halted, Moves To Reorganize
------------------------------------------------------
Judge Bargallo from the Civil and Commercial Tribunal Court No.
11 of Buenos Aires is presently reviewing a petition to
reorganize filed by Metalurgica M.K.M. S.R.L. La Nacion recalls
that the company filed the petition after ceasing to pay its
debts since March 15, 2000.

Clerk No. 21, Dr. Macchi, assists the court on this case.

CONTACT: Metalurgica M.K.M. S.R.L.
         Bolivia 414
         Buenos Aires


S.B. MANDATARIA: Court Grants Reorganization Motion
---------------------------------------------------
S.B. Mandataria S.A., a company operating in Buenos Aires,
begins reorganization proceedings after the city's Court No. 2,
with assistance from Clerk No. 3, granted its "concurso
preventivo" petition.

Infobae reports that the Company will present its settlement
plan to creditors during the informative assembly to be
conducted on November 2, 2004.

CONTACT: S.B. Mandataria S.A.
         Buenos Aires


SONIO S.A.: Court Issues Bankruptcy Ruling
------------------------------------------
Sonio S.A. entered bankruptcy after Buenos Aires Court No. 2
approved a bankruptcy motion filed by one of its creditors,
reports La Nacion. The court assigned Mr. Juan Ignacio Estevez
as trustee for the bankruptcy process. The trustee's duties
include the authentication of the Company's debts and the
preparation of the individual and general reports. Creditors are
required to present their proofs of claims to the trustee before
September 9, 2004.

After verifying the claims, the trustee will submit individual
reports in court on November 4, 2004. A general report on the
case will also be submitted on December 16, 2004.

The Company's assets will be liquidated at the end of the
bankruptcy process to repay creditors. Payments will be based on
the results of the verification process.

CONTACT: Mr. Juan Ignacio Estevez, Trustee
         Uruguay 750
         Buenos Aires


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

EMBRATEL: Merrill Lynch Cuts Rating To Sell
-------------------------------------------
Following Thursday's profit warning, US investment firm Merrill
Lynch has on Friday cut from neutral to sell its recommendation
on shares in Brazilian telecom Embratel, BNamericas relates.
Merrill Lynch stated in a research note that due to declining
long-distance revenue and increased interconnection costs, it
sees the carrier's reported EBITDA for the second quarter of
2004 to be 20-25% lower than previously estimated. From its
original expectation of BRL2 billion, the bank's preliminary
analysis suggests that Embratel's full year EBITDA estimate
could decline to BRL1.6 billion (US$534 million).

Despite strong results in the past three quarters, Merrill Lynch
predicted that the long-distance market, which accounts for 70%
of Embratel's business, would become increasingly competitive.
With fixed-line termination fees expected to continue to
decline, the bank said Embratel's margins are unlikely to
improve.


NET SERVICOS: Clarifies Globopar Deal, Restructuring Plan
---------------------------------------------------------
Net Servicos de Comunicacao S.A. ("Company" or "NET"), a
publicly held company, with headquarters located in the city and
state of Sao Paulo, at Rua Verbo Divino, 1.356 - 1§ andar,
Chacara Santo Antonio, Corporate Taxpayers' Identification
(CNPJ/MF) 00.108.786/0001-65, publicly announces, in response to
the Oficio/CVM/SEP/GEA-2/N262/2004, the following relevant
notice:

As announced through Relevant Notices dated June 27, 2004, and
June 30, 2004, the Company will issue up to 1,825,021,996
shares, taking into consideration both the agreement signed by
Globo Comunicacoes e Participacoes S.A. ("Globopar") to sell its
interest in NET to Telefonos de Mexico, S.A. de C.V. ("Telmex")
("Purchase Agreement") and the restructuring plan agreed to by
the Company and the Creditors Committee ("Plan").

The proportion of voting shares and non-voting shares depends on
the option chosen by the Company. In the case of issuance in the
scope of the Purchase Agreement, this proportion will follow the
current capital structure, approximately 41% of voting shares
and 59% of non-voting shares, which represents the issuance of
up to 745,147,153 voting shares and 1,079,874,843 non-voting
shares.

If the Purchase Agreement is not signed under the expected
conditions and this issuance is according to the Plan, the
proportion will be 25% voting shares and 75% non-voting shares,
which will represent issuance of up to 456,255,490 voting shares
and 1,368,766,497 non-voting shares.

In the scope of the Plan, the issue price to creditors will be
of R$ 0.35 per voting and non-voting shares. At this price, the
creditors offered a firm guarantee to subscribe the shares by
converting their credits. According to the Purchase Agreement,
Globopar will guarantee the subscription of voting shares at R$
0.35 per share. For the non-voting shares, Telmex offered a
subscription firm commitment at a minimum price of R$ 0.35 per
share.

In both cases, a public offering will be accomplished. For the
non-voting shares, the issuance price can be higher than R$ 0.35
per share, as it will be established by a book building process.

The R$ 0.35 per share price was established through a valuation
conducted by the Company and its financial advisors, taking into
consideration, mainly, the Company's economic value from the
profitability perspective, according to subparagraph I of
paragraph 1st of article 170 of the Law 6404/76, and was
validated by its creditors.

This price of R$ 0.35 was established in the scope of the
Company capital restructuring plan, such being an essential
condition to the completion of the restructuring plan, as well
as to an investment by Telmex.

Both negotiations still currently taking place and therefore
remain subject to change. As these changes occur, depending on
their nature and relevance they will be properly disclosed to
the market.

The Company maintains an Investor Relations Area available to
give any information to the market, at the phone (55 11) 5186-
2785 or e-mail ri@netservicos.com.br. In addition, our web site,
www.rinetservicos.com.br, provides all information released to
the market.

Mr. Leonardo P. Gomes Pereira
Net Servicos de Comunicacao S.A.
Chief Financial and Investor Relations Officer
Net Servicos de Comunicacao S.A.

CONTACT: Net Servicos de Comunicacao SA
         R. Verbo Divino, 1356 First Floor
         Sao Paulo - SP,
         Phone: (212) 688-6840
         Fax: (212) 437-5749
         Web Site: http://nettv.globo.com

         or

         Publicom Assessoria de Comunicacao
         Ms. Adriana Duarte
         tel. 5186-2799
         mail.aduarte@publicom.com.br


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

ENAMI: Mulls Quebrada Blanca Stake Sale
---------------------------------------
To help reduce its roughly US$500-million debt, Chile's state-
owned mining company Enami is planning to sell its 10-percent
stake in the Quebrada Blanca copper mine in Region I, reports
Bnamericas, citing local press reports.

"We have the chance to sell our share in Quebrada Blanca to
whoever makes the best offer," mining minister Alfonso Dulanto
said.

This comes as the senate mining committee is studying plans to
transfer Enami's Region V copper refinery Ventanas to state
copper corporation Codelco. The Ventanas transfer, coupled with
the Quebrada Blanca sale, could shrink Enami's debt to US$40
million to US$60 million.

Quebrada Blanca, which produces around 85,000t/y of copper in
cathodes, is 76.5-percent owned by Canada's Aur Resources (TSX:
AUR), while Chile's Minera Pudahuel holds 13.5 percent.


TELEFONICA CTC: Denies Movil Sale Will Affect Performance
---------------------------------------------------------
The sale of Telefonica CTC's cellular telecommunications
subsidiary Telefonica Movil to its Spanish parent Telefonica
will not leave the Chilean telco in a weak position, El Mercurio
reports, citing CTC general director Claudio Munoz.

Mr. Munoz said that without Telefonica Movil, the company
operating profits would have fallen by only US$22 million in
2003 from US$194 million to US$172 million. Although the
cellular telecommunications division is CTC's second highest
source of revenue, its operations require much higher
investments than the group's other businesses.


===============
C O L O M B I A
===============

* Colombia Expects to Raise US$10B Via Asset Sales
--------------------------------------------------
Colombia has committed to a bold privatization plan that could
raise an estimated US$10 billion over the next few years for the
cash-strapped Latin American State. In a report from the
Financial Times, Finance Minister Alberto Carasquilla revealed
that the government is preparing to relinquish control of state-
owned institutions such as electricity distributors and banks in
order to fund its social and economic programs.

This year, the government will tender its 8 percent interest in
power transmission company Isa as well as part of its holdings
in Transelca, a power distribution company. The sales are
expected to bring in US$200 million for the state.

Ecogas, a natural gas distributor, and two banks, Interbanco and
Bancafe, are also scheduled for privatization next year.
Proceeds from these sales could reach as high as US$300-US$400
million.

A recent change in the statutes of Ecopetrol has also opened up
the state-owned oil corporation to privatization. However,
President Uribe has clearly stated that the state will maintain
its control of Ecopetrol.

Mounting fiscal pressure fuels Colombia's rush to privatization.
The country needs fresh funding to maintain its defense programs
as well as provide basic social security services.

Colombia is also feeling the pinch of its massive debt, which
now equals 53 percent of output. At present, debt interest
payments eat up 20 percent of the country's annual spending.


===================
C O S T A   R I C A
===================

ICE: Contract Delays Create Continued Worries
---------------------------------------------
Continual contract difficulties for the "Border to Border"
infrastructure project of Costa Rican electrical and telecom
monopoly ICE has got the firm worried, Bnamericas reports,
citing local paper La Prensa Libre. In addition to a series of
delays and appeals by competing firms since the bidding process
for ICE's national fiber optics infrastructure project was
launched in 2001, Costa Rica's comptroller has nullified on July
14 the company's decision to award the contract to Sweden's
Ericsson, one of the original bidders. With Ericsson out, only
one more firm remains eligible for the contract.

"We are very worried the comptroller's decision not will not
only halt the advanced internet project but also the
strengthening and improvement of fixed and mobile telephony,"
ICE president Pablo Cob was reported as saying. "It seems very
strange to us." Still, ICE had issued a statement on Wednesday
that it would support the comptroller's decision to deny the
Swedish firm the contract.


=========
H A I T I
=========

* US$340M Available For Economic, Social Programs
-------------------------------------------------
The Inter-American Development Bank will join donor countries
and multilateral agencies in an international conference in
Washington, D.C. next week to raise financial aid for priority
programs for the political, economic and social recovery in
Haiti, the poorest country in the Western Hemisphere.

During the July 19-20 conference, which will be co-hosted by the
European Commission, the IDB, the United Nations and the World
Bank under the leadership of the provisional Haitian government,
participants will discuss the Interim Cooperation Framework
(ICF), a document containing an assessment of Haiti's most
pressing development needs for the next two years. On Tuesday
donors will indicate the contributions they plan to make to ICF
projects and activities.

The IDB comes to the table as Haiti's leading source of
financing for long-term development programs. Currently its
portfolio includes soft loans totaling nearly $400 million, of
which $340 million are available for disbursement over the next
few years. Projects supported by the IDB cover sectors
identified as priorities in the cooperation framework:
education, health, potable water and sanitation, rural roads,
agriculture, basic infrastructure and local development.

Two operations totaling $75 million are fast disbursing policy-
based loans that support key measures to build confidence in
Haiti's economic governance, strengthen the management of its
public finances and increase transparency and accountability in
the public sector. Many of the investment projects, which are
designed to be carried out over periods of four or five years,
have already reached the stage at which substantial
disbursements are starting to flow.

In line with the ICF goals of boosting job creation and
generating income for the poor, programs financed by the IDB
seek to employ labor-intensive methods, for instance in public
works to improve roads or build small infrastructure projects in
isolated communities. They will also contribute to key targets
of Haiti's interim government of buttressing economic activity
and raising living standards.

At the same time, the IDB is focusing its efforts on
strengthening the Haitian public sector's capacity to carry out
crucial activities such as administering public resources and
collecting taxes, in order to help government agencies bridge
their considerable needs of technical and professional expertise
to plan, monitor and carry out development programs.

The IDB, whose country office in Port au Prince remained in
operation throughout Haiti's recurrent crises, is also
coordinating its activities closely with donor nations and other
multilateral agencies to ensure efficient and effective
investments of the international community's resources.

CONTACT: Mr. Peter Bate
         Press and Information Officer
         Inter-American Development Bank
         1300 New York Avenue, NW
         Washington  DC 20577
         E-mail: peterb@iadb.org
         Phone: (202) 623-2609


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

* IMF Says Honduran Economic Programs on Track
----------------------------------------------
A team has been in Honduras over the past two weeks or so to
advance discussions with the authorities for the first review of
Honduras's PRGF program with the Fund. The discussions were
brought forward in order to work closely with the authorities as
they sought to adapt their 2004 economic program for the impact
of higher world oil prices than anticipated in the program. As
usual, the discussions have been constructive and very cordial,
and overlapped with last week's conference on Central America
that was held in San Pedro Sula.

The detail's findings confirm that Honduras's program is broadly
on track. Despite short-term pressures from the high oil prices,
the authorities have done well to stay the course of reforms
under their program. Thus, Honduras's growth in 2004 should
exceed the program objective and reach the 3«-4 percent range.
Although the inflation rate has been temporarily affected by the
oil price developments, the authorities are confident that their
financial policies are limiting the second-round effects, and
that 12-month inflation remains firmly in the single-digit
range. The external position has benefited from coffee prices
and exports, as well as by continuing buoyant remittances,
offsetting the higher oil import bill.

The fiscal position has generally been over performing during
the first half of the year. Tax revenues and the wage bill have
been in line with expectations, and the authorities remain
confident of maintaining them in line with the program. They see
recent wage settlements as consistent with their macroeconomic
framework and long-run sustainability. The authorities also see
room to expand pro-poor spending, in line with available
concessional financing from external sources, to help cushion
the impact of the high oil prices on the most vulnerable groups
in society.

Among structural reforms in the authorities' program, the next
key steps relate to the approval of legislation to strengthen
the financial system, including the institutional framework for
monetary policy and supervision. The authorities are confident
of their passage in the coming weeks.

While data for end-June performance criteria are still awaited,
the mission's assessment is that overall developments remain
consistent with completing the first program review in a timely
way. Board approval of the first review will result in another
disbursement from the Fund of about US$15 million, and
constitute a further important step toward achieving the
completion point under the HIPC Initiative, expected in early
2005. Looking forward, the authorities recognize fully that the
continued success of the program, in an environment of growth
and price stability, will depend on maintaining prudent fiscal
policies and implementing the important structural reform agenda
in their program.

CONTACT: IMF EXTERNAL RELATIONS DEPARTMENT
         Public Affairs: 202-623-7300 - Fax: 202-623-6278
         Media Relations: 202-623-7100 - Fax: 202-623-6772


=============
J A M A I C A
=============

KAISER ALUMINUM: Quality Pays $315M for Alpart
----------------------------------------------
On July 1, 2004, Kaiser Aluminum & Chemical Corporation
("KACC"), a wholly owned subsidiary of Kaiser Aluminum
Corporation (the "Company"), completed its previously announced
sale of its 65% interest in and related to Alumina Partners of
Jamaica ("Alpart"), and certain related assets to Quality
Incorporations Limited ("Quality"). Quality was an affiliate of
Hydro Aluminum a.s., ("Hydro"),which owns the remaining 35%
interest of Alpart. KACC sold such interest and related assets
to Quality for gross sales proceeds of approximately $315.0
million, subject to certain post-closing adjustments. The
process that led to the sale of KACC's interests in and related
to Alpart is described in the Company's Quarterly Report on Form
10-Q for the quarterly period ended March 31,2004.

As previously disclosed, the Company expects that proceeds from
the sale will be held in escrow pending both amendment of the
Company's credit agreement and resolution of matters relating to
inter company claims, each of which will require approval by the
U.S. Bankruptcy Court for the District of Delaware (the "Court")
approval. Accordingly, the allocation of proceeds from the sale,
including any use thereof by the Company for its ongoing
operations, will be subject to the Court's approval. The
Company's Quarterly Report on Form 10-Q fort he first quarter of
2004 includes a more detailed discussion of these matters.

As more fully described in the Company's Annual Report on Form
10-K for the year ended December 31, 2003, Alpart owns an
alumina refinery with annual production capacity of 1,650,000
metric tons. Alpart also has bauxite mining operations

CONTACT: Kaiser Aluminum Corp
         5847 San Felipe, Suite 2500
         Houston, TX 77057
         Phone: (713) 267-3777
         Fax: (713) 267-0040
         Email: investorrelations@kaiseral.com

         Web Site: http://www.kaiseral.com


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

AHMSA: 1H04 EBITDA Up 474%
--------------------------
In a report to Mexico City's bourse, Mexican steel maker Ahmsa
(BMV: AHMSA) said it has posted MXN1.85 billion (US$162mn) in
Ebitda for the first half of 2004, a 474 percent rise from the
same period last year, reports Bnamericas. According to the
steel maker, the "positive results" stem from "the recovery of
international market prices" plus corporate "saving, efficiency
and productivity programs implemented during the global steel
crisis".

Consolidated net profits were also up at MXN405 million, a major
turnaround from an MXN624-million loss in 1H03. Sales,
meanwhile, grew 25% to MXN8.25 billion. However, sales volume
fell by roughly 82,000t to 1.2Mt of steel during the period due
to technical problems in furnace 5. This problem, Ahmsa reckons,
cost the company some US$25 million in lost EBITDA.

Controlled by Mexico's GAN group, Ahmsa has a capacity of
roughly 3Mt/y. The company, which describes itself as Mexico's
biggest integrated steelmaker, has been in a form of bankruptcy
protection for more than four years, having defaulted on nearly
US$2 billion in payments.


AHMSA: Taps Luis Zamudio as New CEO
-----------------------------------
The Board of Directors of Altos Hornos de M‚xico (AHMSA)
designated Luis Zamudio as the new Chief Executive Officer (CEO)
of the Company, replacing William H. Bricker, who held that
position until last July 13. Also, the Members of the Board
ratified the powers given to Vector Casa de Bolsa to represent
the Company in its restructure process.

The appointment of Luis Zamudio was based in his wide knowledge
of the Company and his highly professional quality displayed in
more than 30 years of work in Altos Hornos de M‚xico. During
that time he has occupied different positions of high
responsibility, until being designated Rolling and Services
Director and most recently Chief Operating Officer.

"Mr. Zamudio has played a key role in the design and development
of the plans and programs that have helped the Company to
survive in the global steel crisis. Those programs now maintain
the Company in its major levels of operative efficiency.
Additionally, Mr. Zamudio has an outstanding communication
skill, which has helped him to gain a close approach with the
personnel of the Company and with the Union leaders".

Luis Zamudio has a Bachelor Degree in Industrial Engineering at
the Universidad Aut˘noma de Nuevo Le˘n and a Master Degree in
the same institution. He is part of a family closely joint with
the development of the company. He started to work in AHMSA in
1974 as Chief Programmer in AHMSA's Steelworks No. 1

CONTACT: Altos Hornos de M‚xico
         Customer Service
         service@ahmsa.com
         sales@ahmsa.com
         Fax: +52 (866) 633 23 90 and 633 76 24


PARMALAT MEXICO: Assets Acquired By Lala
----------------------------------------
The Mexican assets of collapsed Italian giant Parmalat
Finanziaria Spa (PRF.MI) have been bought by Mexican dairy
products concern Grupo Industrial Lala SA, Dow Jones reports,
citing Lala's human resources director Luis Manuel Perez.

According to Mr. Perez, Lala has bought "a good part" of
Parmalat's Mexico assets, including its plant in Jalisco state.
He, however, refused to say the amount involved in the deal,
which includes a license to market Parmalat brands in Mexico.
Part of the sale's proceeds, Mr. Perez said, will be used by
Parmalat to pay severance to its workers.

The acquisition still requires antitrust clearance, which is
expected within three or four weeks, Mr. Perez said.

Torreon-based Lala has eight pasteurizing plants in Mexico and
128 distribution centers, selling close to 4 million liters of
milk a day.


PEMEX: May Get Petrobras Help In Gulf of Mexico Exploration
-----------------------------------------------------------
Mexican state oil monopoly Pemex might just get the assistance
of Brazilian oil giant Petrobras in the exploration of the Gulf
of Mexico for oil, reports Europe Intelligence Wire. However,
Mexican President Vicente Fox said during his Saturday radio
show that a Pemex alliance with Petrobras would not be limited
to exploration for crude but would include the production of
ethanol, used as a fuel and an alternative to the lead used in
gasoline.

President Fox and Brazilian President Luiz Inacio Lula da Silva
spoke of the possible deal for energy cooperation during the
Mexican leader's recent visit to several countries in the
Southern Cone Common Market (Mercosur) trade bloc, including
Brazil.

"Now we want to see how we go forward on the ethanol route, a
fuel that does not pollute and has a double advantage," Mr. Fox
said.

According to the Mexican president, Brazil developed the
technology to make ethanol from sugar cane, and that the
gasoline now being sold in Brazil contains 5 percent ethanol.


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

AERO CONTINENTE: Seeks 60-day Government Guarantee
--------------------------------------------------
Grounded Peruvian airline Aero Continente has asked the
government for a 60-day credit guarantee so it can resume
operations, relates Bnamericas, citing local press reports.

"We are urgently asking the economy and finance ministry to back
Aero Continente for 60 days so that the transport ministry
allows our planes to fly again," airline president Lupe Zevallos
told local press.

The operations of Aero Continente were suspended on July 12 due
to the failure of its company insurance policy to meet standards
stipulated in Peruvian civil aviation law. The government claims
that Aero Continente's policy does not cover third parties,
carry-on luggage, check-in luggage or cargo, or search and
rescue operations, and only covers the crew and passengers.

Ms. Zevallos said the airline's request is valid, citing the
Peruvian government's backing of Lima's airport administrator
Airport Partners when it did not have the insurance against
terrorist attacks that the US government required.


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

PDVSA: Outlines Increased Oil Production Capacity
-------------------------------------------------
Despite the lingering effects of a strike that virtually
paralyzed the industry last year, Venezuelan state oil company
Petroleos de Venezuela S.A. (PVZ.YY) claims it has upped its oil
production capacity from 3.4 million barrels of crude per day in
January to 3.7 million barrels today, reported The Associated
Press on Friday, citing PDVSA vice president Felix Rodriguez.

These figures, however, are being questioned by analysts and The
Paris-based International Energy Agency, which put last week's
production at closer to 2.5 million barrels daily, citing the
impact of the strike and political instability.

Analysts also said that President Hugo Chavez's dismissal of
18,000 PDVSA employees during a December 2002-February 2003
general strike have hampered production.

Since the strike, Mr. Rodriguez said the company has cut its
production costs by 24 percent, with a current work force of
nearly 13,700.


PDVSA: Executive Details 1H04 Exploration Budget Expenditures
-------------------------------------------------------------
Due to delays in drilling activity at the onset of 2004,
Venezuelan state oil firm Petroleos de Venezuela (PVZ.YY) only
used up 20 to 25 percent of its 2004 allotment for exploration
and production, reveals Dow Jones. PdVSA vice president Felix
Rodriguez last Friday said the delay was due to the lack of
parts for their rigs, which set back drilling activities of some
of their rigs by up to 45 days at the start of the year.

The firm expected to have spent around 38% of its exploration
and production budget during the first half. Still, PdVSA plans
to spend the VEB4.6 trillion ($1=VEB1917.60) it set aside for
investment in exploration and production this year, with
investment picking up during the remainder of 2004.


PDVSA: Reports Oil Sales Earnings of US$13bln
---------------------------------------------
Petroleos de Venezuela, S.A. president Ali Rodriguez Araque
announced on Friday that the state oil firm has earned US$13
billion from oil sales by the end of June, relates local daily
El Universal. The figure does not include revenues from
strategic partnerships.

According to Mr. Rodriguez, earlier announcements on the
recovery of the Venezuelan oil industry will be ratified by the
firm's financial results.

Mr. Rodriguez added that once Venezuela implements an
Organization of Petroleum Exporting Countries (OPEC)-authorized
production increase of 500,000 barrels per day, the country
would meet its output quota under the OPEC.


PDVSA: Unit Reaches Agreement With ExxonMobil On Olefins Project
----------------------------------------------------------------
The Pequiven petrochemical subsidiary of Venezuela's state oil
company PDVSA has "reached an understanding" with US-based
ExxonMobil Chemical Company on the development of an olefins
project at the Jose petrochemicals complex in Anzoategui state,
relates Bnamericas, citing an ExxonMobil spokesperson.

According to the ExxonMobil official, "Pequiven and ExxonMobil
Chemical Company have been in discussions regarding the Jose
Olefins Project. The negotiating teams have reached an
understanding on how the project would be developed, which is
now under review". A PDVSA spokesperson, meanwhile, told
BNamericas that the signing of the final agreement has yet to be
set.

In February, PDVSA president Ali Rodriguez reportedly said that
ExxonMobil could have a 50-percent stake in the project, PDVSA
would have 48 percent and employees the remaining 2 percent.


                            ***********


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

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Copyright 2004.  All rights reserved.  ISSN 1529-2746.

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