TCRLA_Public/040727.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 27, 2004, Vol. 5, Issue 147

                            Headlines



A R G E N T I N A

CENTRO MORASCHI: Bankruptcy Initiated by Court Order
CERAMICA ZANON: Court Delays General Report Deadline
DASSO S.A.: Report Filing Date Extended
DIMAR EDITORA: Liquidates Assets to Repay Debts
LAYPA S.A.: Court Grants Motion to Reorganize

MARTISOL S.C.S.: Court Rules for Liquidation
NABISAL S.R.L.: Court Allows Conversion to Reorganization


B R A Z I L

CEMIG: Board Approval Expected July 28 on Gasmig Sale
COSIPA: Inks 3-Year Deal With CVRD
EMBRATEL: Telmex Completes $400M Acquisition
ODEBRECHT: S&P Affirms Local, Foreign Currency Credit Ratings
ODEBRECHT: Formalizes Olmos Contract With Peruvian Government

TCP: Cuts Loss 73% From 2Q03


C H I L E

AES CHILE: Seeks Arbitration to Settle Gas Dispute
ENDESA CHILE: Reports 32% Drop In 2Q04 Net Profit
TELEFONICA CTC: Posts $134.9M 2Q04 EBITDA


E C U A D O R

PETROECUADOR: Names Three New VPs


M E X I C O

GRUPO IUSACELL: Loses Bid to Throw Out Bondholders' Suit
GRUPO IUSACELL: Reports Burgeoning Losses in 2Q04
GRUPO MEXICO: Union Pays No Heed to Labor Court's Ruling
GRUPO TMM: Amends Tender Quotas in Exchange Offer
TV AZTECA: Profit Hampered by High Costs, Weak Peso


P E R U

PAN AMERICAN: To Complete Morococha Acquisition In August


V E N E Z U E L A

PDVSA: Considering Argentine Expansion
PDVSA: Gross Revenues to Top $46B in 2004


     - - - - - - - - - -

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

CENTRO MORASCHI: Bankruptcy Initiated by Court Order
----------------------------------------------------
Centro Moraschi de la Construccion S.A. enters bankruptcy after
Buenos Aires Court No. 17, with assistance from Clerk No. 33,
ordered the company's liquidation. The bankruptcy order
effectively transfers control of the company's assets to the
court-appointed trustee who will supervise the liquidation
proceedings.

Infobae reports that the court selected Ms. Ana Maria Telle as
trustee. She will be verifying creditors' proofs of claims until
the end of the verification phase on October 21, 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 November 19, 2004 followed by the general report, which is
due on December 21, 2004.

CONTACT: Ms. Ana Maria Telle, Trustee
         Florida 470
         Buenos Aires


CERAMICA ZANON: Court Delays General Report Deadline
----------------------------------------------------
The presentation of the general report on the Ceramica Zanon
S.A.C.I. y M. restructuring has been moved to August 19, 2004.
The court-appointed trustee will prepare this report, which will
provide the court with an audit of the company's accounting and
business records. Likewise, the informative assembly has also
been moved to February 18, 2004.

Buenos Aires Court No. 18 handles this case with the assistance
of Clerk No. 35.

CONTACT: Ceramica Zanon S.A.C.I. y M.
         Carlos F. Melo 650 Vicente Lopez
         Buenos Aires


DASSO S.A.: Report Filing Date Extended
---------------------------------------
Court No. 3 of the San Luis Civil and Commercial Tribunal moved
the filing of the General Report on the Dasso S.A. restructuring
to September 1, 2004, Infobae reports. The scheduled
informational assembly has also been moved to August 5 next
year.


DIMAR EDITORA: Liquidates Assets to Repay Debts
-----------------------------------------------
Buenos Aires based Dimar Editora S.A. will begin liquidating its
assets after the city's Court No. 23 declared the company
bankrupt, says Infobae. The bankruptcy ruling places the company
under the supervision of court-appointed trustee, Ms. Liliana
Noemi Castineira.

Ms. Castineira will verify creditors' proofs of claims until
September 17, 2004. After verification, all claims will be
presented in court as individual reports on November 1, 2004.
The trustee 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 14, 2004.

CONTACT: Mr. Liliana Noemi Castineira, Trustee
         Tucuman 983
         Buenos Aires


LAYPA S.A.: Court Grants Motion to Reorganize
---------------------------------------------
Laypa S.A., a company operating in Mar del Plata, begins
reorganization proceedings after the city's Court No. 11,
assisted by Clerk No. 11, granted its petition for "concurso
preventivo". Reorganization will allow the company to negotiate
a settlement proposal for its creditors so as to avoid a
straight liquidation.

According to Argentine news source Infobae, the reorganization
will be conducted under the direction of Mr. Rodolfo Crespi
Damaso, the court-appointed trustee. Creditors with claims
against Laypa must present proofs of the company's indebtedness
to the trustee before September 28, 2004.

CONTACT: Laypa S.A.
         Chacabuco 5176
         Mar del Plata

         Mr. Rodolfo Crespi Damaso, Trustee
         Corrientes 3028
         Mar del Plata


MARTISOL S.C.S.: Court Rules for Liquidation
--------------------------------------------
Court No. 3 of the Villa Mercedes Civil and Commercial Tribunal
ordered the liquidation of Martisol S.C.S. after the company
defaulted on its debt payments, Infobae reveals.

The liquidation pronouncement will effectively place the
company's assets under the control of Mr. Nestor Julio Caunedo,
the court-appointed trustee.

CONTACT: Martisol S.C.S.
         Avda Mitre 2452
         Villa Mercedes (San Luis)

         Mr. Nestor Julio Caunedo, Trustee
         Espana 301-5730
         Villa Mercedes (San Luis)


NABISAL S.R.L.: Court Allows Conversion to Reorganization
---------------------------------------------------------
Salta Court No. 2 approved Nabisal S.R.L.'s petition to convert
its ongoing bankruptcy into reorganization. The following are
relevant dates in the Company's insolvency proceedings:

1. Creditors' claims verification deadline, September 6, 2004
2. Submission of individual reports, October 26, 2004.
3. Submission of General Report, December 7, 2004.

Mr. Rodolfo Argenti will serve as trustee on this case, says
Infobae.

CONTACT: Nabisal S.R.L.
         Zuviria 333
         Salta

         Mr. Rodolfo Argenti, Trustee
         Alsina 670
         Salta



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

CEMIG: Board Approval Expected July 28 on Gasmig Sale
-----------------------------------------------------
The upcoming July 28 meeting of the board of directors of
Brazilian power company Cemig will see the board's approval of
the sale of a 40% stake in its natural gas distribution
subsidiary Gasmig to federal energy company Petrobras (NYSE:
PBR), Business News Americas reports, citing a local daily.

Valor Economico quoted Cemig chairman Wilson Brumer as saying
that Gasmig and Petrobras have concluded technical discussions
over the sale.

In exchange for US$460 million in investments to expand the
state's gas pipeline network, the Minas Gerais government would
hand over a non-controlling stake in Gasmig to Petrobras' gas
subsidiary Gaspetro.

CONTACT: CEMIG
         Av.Barbacena, 1200
         Santo Agostinho - CEP 30190-131
         Brasil
         Fax (0XX31)299-4691
         Tel.: (0XX31)349-2111


COSIPA: Inks 3-Year Deal With CVRD
----------------------------------
Steel maker Cosipa, part of Belo Horizonte based company
Usiminas, is committed to purchasing 1.1 Mt of iron ore per year
from Brazilian mining group CVRD over the next three years.

Business News Americas says that this contract follows another
deal inked in March with iron ore miner MBR, who will supply the
Company with 1 Mt of iron ore yearly. CVRD's logistics company
Caemi controls MBR. Cosipa relies on CVRD to supply 20-25
percent of the 5Mt/y iron ore it consumes annually.


EMBRATEL: Telmex Completes $400M Acquisition
--------------------------------------------
Embratel Participacoes S.A. (NYSE: EMT - News; BOVESPA: EBTP3
EBTP4) ("EMBRAPAR"), the Company that holds 98.8 percent of the
total capital of Empresa Brasileira de Telecomunicacoes S.A. -
EMBRATEL ("EMBRATEL"), announced Friday that it has been
informed by MCI, Inc. (Nasdaq: MCIP - News; "MCI") and Telefonos
de Mexico, S.A. de C.V. (NYSE: TMX - News; Nasdaq: TFONY - News;
"TELMEX") that TELMEX has completed its acquisition of MCI's
equity stake in EMBRAPAR.

Under the sale agreement announced on March 15, 2004, and
subsequently amended, TELMEX paid an aggregate of US$400 million
cash for MCI's 19.26 percent economic interest and 51.79 percent
voting interest in Embratel.

Embratel is the premier communications provider in Brazil
offering a wide array of advanced communications services over
its own state-of-the-art network. It is the leading provider of
data and Internet services in the country and is well positioned
to be the country's only true national, local service provider
for corporates.

Service offerings: include telephony, advanced voice, high-speed
data communication services, Internet, satellite data
communications, corporate networks and local voice services for
corporate clients. Embratel is uniquely positioned to be the
all-distance telecommunications network of South America. The
Company's network has countrywide coverage with 28,868 km of
fiber cables comprising 1,068,657 km of optic fibers.

CONTACT: Ms. Silvia M.R. Pereira
         Investor Relations
         tel: (55 21) 2121-9662
         fax: (55 21) 2121-6388
         email: silvia.pereira@embratel.com.br
                invest@embratel.com.br

         Web Site: www.embratel.com.br


ODEBRECHT: S&P Affirms Local, Foreign Currency Credit Ratings
-------------------------------------------------------------
Standard & Poor's affirmed its 'BB-' local-currency and 'B+'
foreign-currency corporate credit ratings on Brazil's leading
engineering and construction company Construtora Norberto
Odebrecht (CNO). The local-currency rating outlook is stable;
the foreign-currency rating outlook is positive.

"The local-currency rating on CNO reflects the company's
exposure to the competitive, volatile, and cyclical heavy
construction business, some backlog concentration in public
works in economically and politically volatile countries, and a
somewhat leveraged financial profile," said Standard & Poor's
credit analyst Reginaldo Takara. "These risks are somewhat
offset by CNO's longstanding experience in the engineering and
construction business, the quality and sector and geographic
diversification of its backlog, and consistent profitability and
cash flow protection measures in the past several years as a
result of significant efforts to focus on more profitable
projects."

CNO is one of the largest engineering and construction (E&C)
companies in Brazil, having reported net revenues of US$1.65
billion and EBITDA of US$143 million in the past 12 months ended
March 30, 2004.

The local-currency rating stable outlook factors in Standard &
Poor's expectations that CNO will manage to reduce total debt
levels through first-half 2005, after having essentially solved
refinancing risks for the next 18 months with new bank
facilities just closed. The positive foreign-currency rating
outlook reflects that of the foreign-currency sovereign rating
of the Federative Republic of Brazil.

ANALYSTS:  Reginaldo Takara, Sao Paulo (55) 11-5501-8932
           Milena Zaniboni, Sao Paulo (55) 11-5501-8945


ODEBRECHT: Formalizes Olmos Contract With Peruvian Government
-------------------------------------------------------------
Brazilian construction firm Odebrecht has formalized the 20-year
Olmos irrigation concession contract with Peru's President
Alejandro Toledo, the Lambayeque department government, reports
Business News Americas. Under the contract, Odebrecht will
construct, operate and do maintenance work on the first stage of
the Limon dam and the Transandino tunnel that will transport
water to irrigate land in Lambayeque.

The initial phase of the project will cost US$185 million,
US$108 million of which will come from the private sector and
US$77 million from Peru's central and regional governments.

The whole project, which requires a total investment of up to
US$700 million, will divert water from the eastern side of the
Andes Mountains to the Pacific side to increase agricultural
yields in more than 150,000 hectares.


TCP: Cuts Loss 73% From 2Q03
----------------------------
TELESP CELULAR PARTICIPACOES S.A. (BOVESPA: TSPP3; NYSE: TCP),
announced Friday its consolidated results for the second quarter
of 2004 (2Q04). The Company's operating and financial
information, except as otherwise indicated, is presented in
Brazilian Reais in accordance with Brazilian Corporate Law.

TCP is one of the companies of the largest wireless group in the
southern hemisphere and controls:

(i) 100% of the capital stock of Telesp Celular S.A. (TC);
(ii) 100% of the capital stock of Global Telecom S.A. (GT); and
(iii) 90.73% of the voting capital (29.31% of total capital),
excluding treasury shares, of Tele Centro Oeste Celular
Participacoes S.A. (TCO).

TCP, along with Tele Leste Celular Participacoes S.A., Tele
Sudeste Celular Participacoes S.A. and Celular CRT Participacoes
S.A, make up the assets of the Joint Venture between Telefónica
Móviles and Portugal Telecom, operating under VIVO brand, Top of
Mind in the Brazilian market.

2Q04 HIGHLIGHTS:

- In relation to 2Q03 and to 1Q04 (including TCO), the customer
base increased by 42.6% and 8.6%, respectively, reaching 15,530
thousand customers, and 8.6%, as compared to 1Q04. Net additions
in 2Q04 totaled 1,235 thousand new customers, 204.9% above
additions recorded in the same period last year and 23.9% above
additions recorded for 1Q04, a result of the enhanced commercial
activity, in special the Mother's Day and Valentine's Day
promotional campaigns.

- TCP was responsible for a 43.8% share in net additions in 2Q04
in the region where it operates, 6.3 percentile points more than
in 2Q03.

- TCP recorded again an increase in its contract customer base
in 2Q04, having grown 5.7% and 1.3% in relation to 2Q03
(including TCO) and 1Q04, respectively.

- 1.6% Churn, a decrease of 0.5 percentile points in relation to
the 2Q03 Churn and remaining stable in relation to 1Q04, despite
the disconnection of prepaid customers due to their failure to
update personal record information, as required by Anatel, and
to the enhanced competition activity.

- The R$ 125 SAC recorded in 2Q04 decreased by 17.1% when
compared to 2Q03, and remained stable in relation to the
previous quarter.

- Contract ARPU increased from R$ 89.5, in 1Q04, to R$ 92.5, in
2Q04.

- In 2Q04, prepaid and contract outgoing MOU increased by 25%
and 8%, respectively, when compared to 2Q03.

- EBITDA reached R$ 644.9 million, higher than in 2Q03,
generating an EBITDA margin of 35.1%.

- TCP's loss in 2Q04 decreased by 73.0% (R$ 182.1 million), when
compared to the same period of last year.

- Data revenues represent 4.8% of the net revenue from services,
as compared to 2.4% in 2Q03.

- Global Telecom, SPM operator, formerly created as a "B" band
operator, in Paraná and Santa Catarina states, surpassed the
coverage provided by its A Band competitor, being the first
carrier to achieve this performance.


Technological Innovation:

The companies controlled by TCP already operate high speed
Mobile Internet through their CDMA 1xRTT networks, At the end of
June 2004, the coverage already reached 27 municipalities in the
state of São Paulo (approximately 82% of the population in the
metropolitan region of São Paulo and 14% in the interior land),
8 municipalities in Paraná and Santa Catarina states (17% of the
population of both states) and 46 municipalities in area 7,
exploited by TCO (39% of the population).

It is estimated that the coverage will reach more than 340
municipalities by the yearend in the whole area covered by TCP.
In May, VIVO announced the implantation of a very high speed
data transmission mobile network in São Paulo and Rio de
Janeiro, using CDMA2000 1xEV-DO (Evolution - Data Only) 3rd
generation technology.

TCO has continued to keep its focus on data transmission
services, having implemented new products such as "VIVO em
Ação", an innovation that has made VIVO the first mobile
telephone operator in the world to launch an alternative reality
game (ARG). Such game lasted four weeks and was played by
approximately 1.4 million customers throughout Brazil.


Basis for Presentation of Results:

As from May 1, 2003, TCP started consolidating Tele Centro Oeste
(TCO)'s information due to its acquisition of that company's
share control.

For comparison purposes, we also present the 2Q03 consolidated
results, including TCO's results for April.

The Personal Mobile Service (SMP) operators implemented Carrier
Selection Codes (CSP) for domestic and international long
distance calls, in accordance with Anatel's rules. Therefore,
the TCP operators no longer earn VC2 or VC3 (long-distance)
revenues, and currently derive interconnection revenue (VUM)
from the usage of their network for completing long distance
calls.

The Bill & Keep system was also implemented, under which payment
for use of local network among SMP operators is not made unless
traffic rate among them exceeds 55%, which fact causes an impact
over interconnection revenue and cost.

Some information disclosed on March 31, 2004 and on June 30,
2003 may be re-classified, as applicable, for comparison
purposes. Total amounts are subject to differences, due to
rounding-up procedures.

TC's Operating Highlights:

- TC's customers base increased by 35.6% in relation to 2Q03,
reaching 8,500 thousand customers, and 6.6% in relation to 1Q04.
Net additions in the quarter period were 530 thousand customers,
a 215% growth in relation to the same period in 2003.

- In 2Q04 TC remained as market leader in terms of net
additions, with a 40% increase in its market share when compared
to 2Q03, despite the enhanced marketing actions currently
carried out by its competitors.

- Churn recorded 1.6%, reflecting the disconnection of prepaid
customers due to their failure to update personal record
information, as required by Anatel, and to the enhanced
competition activity.

- The ARPU decreased by 16.4% and 6.1% in relation to 2Q03 and
1Q04, respectively, as a result of the growth in prepaid
customers which became 82% of the total base (77% in 2Q03),
generating a loss of R$ 3.9 between 2Q04 and 2Q03, and of the
drop in the incoming MOU of 14.3% and 9.0%, when compared to the
same periods. Excluding the SMP (Bill & Keep and CSP) effects,
the reduction in the blended ARPU when compared to 2Q03 would be
11.7%, which also reflects a growth in the average customer base
and an increased volume of bonuses granted in the quarter
period. When compared to 1Q04, the prepaid ARPU decreased by
7.1%, mainly as a result of the 11.8% drop in the incoming MOU.

- SAC decreased by 14.9% in relation to 2Q03, due to a reduction
in subsidies, advertising and discounts in handset acquisition
prices obtained from suppliers after the incorporation of VIVO
Group. In relation to 1Q04, SAC increased due to enhanced
competition activity and higher subsidy costs, which were
materially affected by the negative foreign exchange variation
in 2Q04 (5.3% increase in average dollar rates between 2Q04 and
2Q04), partially offset, however, by better negotiations with
commercial partners.

- The number of customers/employee in 2Q04 increased by 20.4%,
in relation to 2Q03, and by 3.7%, in relation to 1Q04. Growing
efficiency in operations and scale economies allowed the
productivity improvement trend to be kept.


GT's Operating Highlights:

- GT's customers recorded increases by 65.4% and 13.7% in
relation to 2Q03 and 1Q04, respectively. Net additions increased
by 201.2% and 40.7% in relation to 2Q03 and 1Q04, respectively,
which figures are above Brazilian average.

- In 2Q04 GT reached a 44.5% share in net additions, keeping its
market share stable in relation to 1Q04, and increasing by 3.5
p.p. in comparison to 2Q03, despite the entry of a new carrier
in the market.

- The blended ARPU was R$ 25.5, a reduction of 27.6% in relation
to 2Q03, as a result of the growth in prepaid customer - with
lower ARPU - which reached 87% of the total customer base (79%
in 2Q03), generating a loss of R$ 4.3 between 2Q04 and 2Q03, and
of the drop in the blended MOU of 19.1% and 11.6%, when compared
to 2Q03 and 1Q04, respectively. Excluding the SMP effect, the
blended ARPU would be R$ 27.6, recording a 21.6% reduction in
relation to 2Q03, which also reflects a growth in the average
customer base and an increased volume of bonuses granted in the
quarter period. Contract ARPU remained unchanged during this
quarter period.

- SAC decreased by 11.5% and 4.4% in relation to 2Q03 and 1Q04,
respectively, despite the negative impact caused by the foreign
exchange variation in the period, due to the reduction in
subsidies, advertising and discounts in handset prices obtained
from suppliers.

- Churn recorded 0.9%, a reduction of 0.5 percentile point in
relation to 1Q04 and 2Q03, despite the disconnection of prepaid
customers, due to their failure to comply with the personal
information record updating requirements, and the enhanced
competition activity.

- Synergy and efficiency gains obtained from the unification of
the VIVO operators' structures has allowed an improvement trend
in productivity,

Consolidated TCO's Operating Highlights:

- TCO's customer base increased by 47.2% in the last 12 months
and by 10.1% in the quarter period. Net additions in the quarter
period were 195.4% greater than those recorded in 2Q03 and 32.1%
higher than those in 1Q04, which reflected enhanced marketing
efforts applied to the Mother's Day and Valentine's Day
promotional campaigns.

- TCO recorded a 48.7% market share in net additions in 2Q04, as
compared to 36.3% in 2Q03, reflecting the Company's market
leadership, with 55.0% market share.

- Churn recorded 2.0%, which reflected the event of
disconnection of prepaid customers due to their failure to
comply with Anatel's requirements for updating the personal
record information. If we excluded such effects, churn would be
1.7%, in line with 1Q04.

- Reported blended ARPU of R$33.7, down 22.2% YoY, was impacted
by the SMP effect (R$3.4), the change in the customer mix
equivalent to R$3.9 (prepaid customer base grew 62.3% accounting
for 81% of the total base, compared with 73% a year earlier),
the fall in incoming MOU of 23% and by the higher incidence of
free traffic bonus. Normalizing for the mix and SMP (B&K, CSP),
the ARPU reduction would have been of R$2.3 or 6.4% YoY. Quarter
over quarter, the blended ARPU rose 6.6% primarily driven by an
11.7% increase in outgoing MOU.

- TCO's SAC decreased by 22.8% in relation to 2Q03, due to a
reduction in subsidies, advertising and discounts in handset
acquisition prices obtained from suppliers after the
incorporation of the Company into VIVO's Group. In relation to
1Q04, SAC increased due to enhanced competition activity and
higher subsidy costs, which was materially affected by foreign
exchange variation in 2Q04 (5.3% increase in average dollar
rates between 2Q04 and 1Q04), partially offset, however, by
better negotiations with commercial partners. Increasing
improvement in operations, scale economies and administrative
efficiency allowed productivity to continue growing in 2Q04,
having increased by 66.2% and by 12.6% in relation to 2Q03 and
1Q04, respectively.

Net Revenue from Services

Net revenue from services reached R$ 1,544.2 million,
representing a 10.4% growth in relation to 2Q03 (including
April, for TCO), reflecting a 39.1% increase in the average
customer base and greater use of data services. Excluding the
SMP effect, the net revenue would have increased by 18.1% in
relation to 2Q03.

Revenue from Data

Revenue from data continued to grow, having recorded 110.9% and
3.5% increases in relation to 2Q03 and 1Q04, respectively,
representing 4.6% of the net revenue from services in 2Q04 (5.1%
in 2Q03). Such increase was possible due to the availability of
new services and existence of popular campaigns promoting access
and use of these services on a nationwide basis. SMS represented
71.2% of the data revenue in the period. The average number of
SMS messages sent per month in 1Q04 was approximately 70
million, a 76% growth in relation to the average of the same
period of 2003.

Personnel Cost

Personnel cost in 2Q04 increased by 16.8% (including April for
TCO) in relation to the same period of last year. Such increase
was due to a collective labor agreement executed in November
2003, which approved a 7.5% increase in the payroll, as a result
of the salaries reclassification occurred in October 2003, as
well as to enhanced commercial activities (personnel cost
related to sales).

Cost of Services Rendered

Reduction of 26.5% (including April for TCO) in relation to 2Q03
due to lower interconnection costs that were materially affected
by the SMP and third-party services rules. Excluding the SMP
effects, the cost of services rendered would be unchanged in
relation to 1Q04.

Selling Expenses

In 2Q04, selling expenses increased by 30.3% in relation to
2Q03, due to the write-off of the provision for doubtful debtors
(PDD) posted by GT in 1Q04, higher call center costs,
competition intensification and enhanced commercial activity
(gross additions increased by 84%).

It is worth to highlight the positive annual evolution of TCP's
consolidated SAC (Subscriber Acquisition Cost), which was
reduced to R$ 125, a 17.1% decrease when compared to 2Q03, due
to handsets subsidy reduction. The increase in relation to 1Q04
was due, mainly, to Brazilian real devaluation against US dollar
and to enhance competition activity.


Bad Debt

The provision for doubtful debtors in 2Q04 recorded a 25.3%
increase in relation to 1Q04, as a result of the reversal in the
PDD write-off in GT in 1Q04, which was reversed in 2Q04. Should
that adjustment be disregarded, the PDD would have been reduced
by 4.2%, representing 1.9% of the total gross revenue. The
company continues to strive for ensuring quality contract
customer base, as well as for keeping Vivo Group's strategy for
monitoring credit to resellers and corporate customers.

General and administrative expenses

General expenses recorded 18.8% and 42.4% increases when
compared to 2Q03 and 1Q04, respectively. Such increases were
caused by the raise of system maintenance and consulting costs
and taxes. Excluding this effect, a 9.0% reduction would have
been achieved in relation to 2Q03 and an 8.7% increase in
relation to 1Q04 in general expenses.

EBITDA

TCP's EBITDA in 2Q04 (including April, for TCO) were R$ 644.9
million, a 6.9% increase when compared to 2Q03, representing a
35.1% margin (36.2% - including TCO - in 2Q03) and 41.8% on the
net revenue from services.

Depreciation and Amortization

Depreciation and amortization recorded a 1.4% increase in
relation to 1Q04, due to the new investments under way and
reduction in the time period for amortization of the Premium
paid upon TCO acquisition.

Financial Income

In relation to 1Q04 TCP's financial income decreased by R$ 62.8
million (28.7%), mainly as a result of the increase in the rate
of Cofins tax levied on Interest On Own Capital paid by TC to
TCP (R$ 274 million) and on gains from derivatives transactions
occurred in the quarter period due to the devaluation of
Brazilian Real against US Dollar. Excluding these facts, the net
income would have remained stable.

Net Loss

TCP's loss in 2Q04 was R$ 67.3 million, recording a 90.7%
increase in relation to the net loss of R$ 35.3 million recorded
in 1Q04. If the current corporate share in TCO's loss in April
were added in 2Q03, the loss would be R$ 249.4 million,
resulting in a 73.0% reduction in the loss recorded for 2Q04.

Indebtedness

On June 30, 2004, TCP's debt with loans and financings amounted
to R$ 6,355.3 million (R$ 6,215.4 million on March 31, 2004),
82.9% of which is denominated in foreign currency. The company
has entered into exchange rate hedging contracts for protecting
100% of its debt against foreign exchange volatility. This debt
was offset by cash and financial investments (R$ 1,099.5
million) and by derivative assets and liabilities (R$ 774
million receivable), resulting in a net debt of R$ 4,481.8
million.

At the end of 2Q04, short-term debt represented 67.4% of total
debt. Short-term debt is impacted by a R$ 500 million issue of
debentures maturing in August 2004, as well as by ? 416 million
loans with one of the controlling shareholders and USD 150
million Commercial Papers issued in the foreign market, both
maturing in November 2004.

Capital Expenditures

Capital expenditures recorded in the quarter period were R$
343.1 million, as compared to R$ 96.1 million expenditures in
2Q03 (including TCO). Such amount represents 18.7% of the net
revenue, in comparison to 6.4% in the same period of last year.
The amount invested in 2Q04 was mainly intended for improvement
and capacity expansion projects related to the services
rendered, selective implantation of the 1xRTT network
by overlaying TDMA network in TCO, evolution of GT's network to
1xRTT, provision of new telecommunication services, development
of own transmission routes and integration of systems and
advisory services. Capex in the semester represent 12.6% of the
net revenue from services.

Operating Cash Flow

Cash flow recorded a reduction from 31.5% to 49.1% when compared
to 2Q03 and 1Q04, respectively. Such reduction was caused,
mainly, by the amount of capital expenditures the company has
effected. Even thus, the cash flow income ascertained in the
period shows that enough funds have been generated from its
operations to ensure its capital expenditures program.

Subsequent Events

- On June 30, 2004, the corporate restructuring involving Tele
Centro Oeste Celular Participacoes S.A. and its controlled
companies:: Telegoiás Celular S.A., Telems Celular S.A., Telemat
Celular S.A., Teleacre Celular S.A. and Teleron Celular S.A.
This restructuring will allow an advance in capitalization
conditions for TCO Participacoes and its operators, besides an
improvement in the respective companies' cash flows, as a result
of the tax benefit, in the approximate amount of R$ 511 million,
generated as from the premium amortization, in the next five
years, owed by TCP upon TCO acquisition. The transaction will
not entail any change in the share control of TCO Participacoes
and of its operators, except for the fact that the operators
became TCO's wholly-owned subsidiaries. Further information
about the transaction may be accessed from our website.

- On July 8, 2004, the company's Board of Directors approved the
conditions for renegotiation of its first issue debentures, the
yield rate having been established as 104.4% of CDI. The terms
and conditions detailed in the renegotiation are disclosed in
the Notice to debenture holders of the same date, and may be
accessed from our website.

Social Responsibility

VIVO launched the VIVO Institute, on July 7, 2004, thus
enhancing its Social Responsibility actions in the whole
country. Focusing on education and environment actions, VIVO
Institute has the mission of promoting citizenship, by sharing
VIVO's values and experiences with the society as a whole.
Within TCP's coverage area, VIVO Institute supports social
actions in conjunction with the Ayrton Senna Institute and
Pastoral da Criança (Children's Pastoral Mission), in addition
to developing campaigns designed to promote social welfare and
population citizenship, such as the "Guri" Project and the
Telecenters in São Paulo. VIVO's social investment in 2004
should reach R$ 12 million.

Prizes

VIVO was awarded, in May, the "Consumidor Moderno's Excellence
in Customer Services Prize", granted by Revista Consumidor
Moderno (Modern Consumer Magazine). In June, four VIVO cases
were also awarded prizes, among which "VIVO ao VIVO" and VIVO
Open Air were awarded the "Top of Marketing" prize from the
Brazilian Association of Sales and Marketing Officers (ADVB).

To see financial statements:
http://bankrupt.com/misc/tCPFS_2Q04.doc

CONTACT: Telesp Celular Participacoes SA
         Rua Abilio Soares 409, - 10o andar
         Sao Paulo,  04005
         Phone: (212) 889-4350
         Email: webmaster@telespcelular.com.br

         Web Site: www.telespcelular.com.br



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

AES CHILE: Seeks Arbitration to Settle Gas Dispute
--------------------------------------------------
AES Gener, a unit of U.S. utility AES Corp., informed Chile's
securities regulator that it has launched arbitration
proceedings against Argentine gas suppliers, reports Dow Jones.
Gener is seeking compensation to losses incurred following the
Argentine government's unilateral decision to reduce natural gas
exports to Chile from late March to stave off a looming domestic
energy crisis.

Argentina's natural gas supply restrictions has been
particularly severe for Chilean electricity generating plants in
the north and center of the country as well as the methanol
complex in Punta Arenas.

AES Gener reported that its main electricity plant in Santiago
faces a supply contract restriction of 30% equivalent to 1,7
million cubic meters per day. The natural gas supply restriction
has forced Chile to purchase other more expensive fuels to
compensate and this has been passed on to the electricity and
residential gas bills.

Companies Gener wants compensation from are Petrolera Santa Fe
S.A., Mobil Exploration & Development Argentina Inc., Atalaya
Energy S.R.L., Canadian Hunter Argentina S.R.L., and Total
Austral S.A., a unit of French Total SA (TOT).

The arbitrage will be handled by the international chamber of
commerce based in Buenos Aires.

CONTACT:  AES GENER S.A.
          Mariano Sanchez
          Fontecilla 310 PISO 3
          SANTIAGO 3514
          Phone Number: 6868900
          Fax: 6868990
          President: BRANDT JOSEPH
          CEO: CERON CERON LUIS FELIPE
          Email: gener@gener.cl
          URL: http://www.gener.cl


ENDESA CHILE: Reports 32% Drop In 2Q04 Net Profit
-------------------------------------------------
Empresa Nacional de Electricidad SA (Endesa Chile), the
country's largest power generator, reported Friday that its
revenue in the second quarter rose 12% to CLP547.59 billion
($1=CLP634.50) from the year-earlier period. However, the
Company said net profit during the quarter dropped 32% to
CLP32.95 billion as its tax bill in Argentina jumped.

The results confirmed that the electricity generator hasn't
suffered since Argentina began capping exports to Chile in late
March to avoid a power crisis in its own country.

Company executives say they've been shielded from the fallout so
far because about 75% of the Company's power generation is
hydroelectric and a 6.2% increase in power node prices offset
the rising cost of natural gas inputs.

Additionally, the Company's 570-megawatt capacity Ralco plant,
which took seven years to build, about a year and-a-half longer
than planned, will begin generating cheap, water-powered
electricity in Chile next month.

Endesa Chile is 59.98% owned by Enersis SA (ENI), the holding
vehicle for Spanish utility Endesa SA's (ELE) Latin American
operations.

CONTACT: ENDESA CHILE
         Santa Rosa 76
         Santiago, CHILE
         Phone: (212) 688-6840
         Fax: (212) 838-3393
         Web Site: http://www.endesa.cl


TELEFONICA CTC: Posts $134.9M 2Q04 EBITDA
------------------------------------------
Highlights:

- The Company recorded a profit of Ch$6,320 million (US$9.9
million) in 2Q04, compared to a profit of Ch$917 million (US$1.4
million) in 2Q03

- EBITDA amounted to Ch$85,814 million (US$134.9 million) in
2Q04, compared to Ch$93,773 million (US$147.4 million) in 2Q03.

- EBITDA margin reached 42.6% in 2Q04, compared to 46.8% in 2Q03

Compania de Telecomunicaciones de Chile S.A. (NYSE:
CTC)("Telefonica CTC Chile" or the "Company") announced on
Wednesday its financial results, submitted to an internal
financial review by independent auditors, stated in Chilean GAAP
(in constant Chilean pesos as of June 30, 2004) for the second
quarter of 2004. U.S. dollar equivalent information is based on
the Observed Exchange Rate (as defined by the Chilean Central
Bank) for June 30, 2004, which was Ch$636.30 = US$1.00.

This information will be made publicly available through the
Chilean Superintendencia de Valores y Seguros ("SVS") and the
Securities and Exchange Commission of the United States of
America (www.sec.gov), as well as at the Company's website,
www.telefonicactcchile.cl.

Revenues:

Telefonica CTC Chile's revenues increased by 0.5% in 2Q04 as
compared to 2Q03, amounting to Ch$201,665 million (US$316.9
million). Regarding the evolution in the different business
areas, fixed telephony and long distance revenues negatively
impacted the consolidated revenues during 2Q04, with decreases
of 5.7% and 9.4%, respectively, compared to 2Q03. These declines
were partially offset by increases of 11.1% in mobile services,
1.3% in corporate communications and 9.3% in other businesses,
which includes revenues from public telephones, interior
installations and from the subsidiary Telemergencia (home
security services).

Operating Costs and Expenses:

- Operating costs and expenses increased by 4.4% in 2Q04, to
Ch$180,758 million (US$284.1 million), as compared to Ch$173,145
million (US$272.1 million) in 2Q03.

- Salary expenses increased 1.5% in 2Q04 when compared to 2Q03,
to Ch$14,282 million (US$22.4 million), mainly due to higher
salaries in the mobile business.

-Other operating costs and expenses increased by 13.9% in 2Q04
as compared to 2Q03, to Ch$57,263 million (US$90.0 million).
This increase is attributable to growth in the mobile business
and the associated increase in costs for equipment sales.

- Administrative and selling expenses increased by 7.9% in 2Q04
as compared to 2Q03, to Ch$46,031 million (US$72.3 million), due
to higher marketing costs associated with the growth which in
turn have generated an increase in sales costs and advertising.

EBITDA:

As a result of the above, EBITDA in 2Q04 fell by 8.5% to
Ch$85,814 million (US$134.9 million), compared to Ch$93,773
million (US$147.4 million) recorded in 2Q03. EBITDA margin in
2Q04 was 42.6%, compared to 46.8% recorded in 2Q03.

Depreciation:

As of 4Q03, depreciation of assets related to the sales and
administration will be accounted for under "Administrative and
selling expenses". Exhibits were adjusted accordingly in the
four quarters of 2003. Total depreciation in 2Q04 decreased by
2.2% to Ch$64,907 million (US$102.0 million), as compared to
2Q03.

Operating Income:

Operating Income decreased by 23.8% to Ch$20,907 million
(US$32.8 million) in 2Q04 when compared to Ch$27,421 million
(US$43.1 million) recorded in 2Q03. The operating margin
amounted to 10.4% in 2Q04 as compared to 13.7% in 2Q03.

Non-Operating Income (Loss)

Telefonica CTC Chile recorded a lower nonoperating loss, meaning
a 68.6% decrease to Ch$5,959 million (US$9.4 million) in 2Q04,
as compared to a non-operating loss of Ch$18,991 million
(US$29.8 million) in 2Q03. This improvement is basically the
result of:

(i) A decrease of 34.4% in financial interest expenses in 2Q04
with respect to 2Q03 as a result of a 2.4% reduction in average
interestbearing debt (US$1,421 million in 2T04) and a lower
exchange rate for the Chilean peso vs. US dollar;

(ii) A monetary correction gain of Ch$4,154 million (US$6.5
million) in 2Q04, compared to a monetary correction loss of
Ch$2,435 million (US$3.8 million) registered in 2Q03, mainly
explained by the positive CPI in 2Q04 and the gain for exchange
rate gain resulting from the hedging of financial expenses;

(iii) A 42.2% increase in other non-operating income due to the
profit of Ch$6,397 million (US$10.1 million) obtained from the
sale of Publiguias, and

(iv) A 24.9% decrease in the amortization of goodwill as a
result of the accounting of the amortization of Sonda's goodwill
up to July 2003.

The above was partially offset by:

(i) a 24.6% decrease in interest income due to lower local
interest rates and a lower cash position resulting from the
Company's reduction in interest-bearing debt, and

(ii) a 74.4% increase in other non-operating expenses due to
costs from the business restructuring incurred in 2Q04.

Income Taxes:

In 2Q04, Telefonica CTC Chile recorded a total income tax charge
in the amount of Ch$8,658 million (US$13.6 million) as compared
to the Ch$7,516 million (US$11.8 million) tax charge registered
in 2Q03. This total income tax is composed of Ch$5,333 million
(US$8.4 million) in current income tax and a Ch$3,324 million
(US$5.2 million) charge for deferred taxes for the period as
well as amortization of deferred taxes for previous periods.

Net Result:

The Company recorded a net income of Ch$6,320 million (US$9.9
million) in 2Q04 as compared to a net income of Ch$917 million
(US$1.4 million) recorded in 2Q03. Net income per ADR in 2Q04
amounted to US$0.042, compared to a net income per ADR of
US$0.005 recorded in 2Q03. Furthermore, net income per share in
2Q04 equaled Ch$6.6 as compared to the net income of Ch$1.0 in
2Q03.

Capital Expenditures:

Capital expenditures for Telefonica CTC Chile and its
consolidated subsidiaries amounted to US$45 million in 2Q04
compared to US$61 million in 2Q03, given the higher capital
expenditures devoted to deployment of the GSM network in 2003.

Consolidated Free Cash Flow From Operations:

The consolidated free cash flow from operations3 in 2Q04 reached
Ch$42,051 million (US$66.1 million) as compared to Ch$37,810
million (US$59.4 million) in 2Q03.

REVENUE BY BUSINESS UNIT:

Fixed Telephony:

Revenues from fixed telephony services include Primary Service,
Access Charges and Interconnections and Directory Advertising.
Fixed telephony revenues, which represented 43.6% of total
operating revenues in 2Q04, decreased by 5.7% to Ch$88,010
million (US$138.3 million) as compared to 2Q03. Since May 2004,
the Company has made the appropriate provisions regarding new
tariffs imposed under the Tariff Decree No. 169. These tariffs,
once they receive approval from the Chilean Controller, will
become effective retroactively to May 6, 2004.

Primary service revenues, which include the fixed monthly
charge, variable charge, connections and other installations,
value-added services and equipment marketing, plus others (ADSL,
IP flat fee, rural telephony, among others), decreased by 8.4%
to Ch$80,263 million (US$126.1 million) in 2Q04 as compared to
2Q03. This decrease is mainly attributable to a 4.2% decrease in
the fixed monthly charge and a 19.9% decrease in the variable
charge due to:

(i) a 7.2% decrease in average lines in service in 2Q04 vs.
2Q03, as result of higher disconnections in 2003 from tighter
control of non-payment;
(ii) the provisioning for the effects from applying the new
Tariff Decree, and (iii) a 10.2% decrease in total local traffic
for 2Q04 compared to 2Q03. However, the above was partially
offset by a 75.0% increase in other fixed telephony revenues
primarily due to the growth in new services over fixed line,
such as ADSL (a 95.4% growth in lines in service in 2Q04 vs.
2Q03) and flat fee plans.

Access charges and interconnections include revenues from access
charges generated by LD carriers, as well as those paid by other
telecommunications operators that use Telefonica CTC Chile's
network. They also include other interconnection services apart
from access charges, such as interconnection of networks and
information services to carriers, among others. These revenues
increased by 38.7% in 2Q04 to Ch$7,428 million (US$11.7 million)
as compared to 2Q03. This increase was mainly due to 80.7%
increase in other interconnection services due to the effect of
the new Tariff Decree No. 169 since May 2004 and the
regularization of revenues from other fixed telephony operators.

Revenues from directory advertising, generated by the Company's
contract with Publiguias, decreased by 11.1% in 2Q04 to Ch$319
million (US$0.5 million) as compared to 2Q03.

Long Distance:

Long distance revenues include revenues from domestic and
international long distance traffic carried by 188 Telefonica
Mundo and Globus 120, as well as revenues from the rental of the
long distance network to other telecom operators. Total long
distance revenues, which accounted for 7.3% of consolidated
operating revenues in 2Q04, decreased by 9.4% as compared to
2Q03, to Ch$14,760 million (US$23.2 million). This decrease in
revenues was mainly due to:

(i) lower revenues from domestic long distance services ("DLD")
due to the 13.4% decrease in the average price for this service,
although DLD traffic carried by 188 Telefonica Mundo and Globus
120 grew 7.4% in 2Q04 as compared to 2Q03, and

(ii) lower revenues from international long distance services
("ILD") due to a reduction of 11.0% in the outgoing ILD average
price in 2Q04 vs. 2Q03, although outgoing ILD average traffic
increased 7.0% in 2Q04 compared to 2Q03, and

(iii) lower revenues from the rental of the long distance
network to other telecom operators due to lower prices and lower
industry traffic in general.

Mobile Telecommunications:

Mobile communications revenues include revenues from outgoing
cellular traffic and interconnection revenues from Calling Party
Pays (incoming traffic to the mobile network), as well as
revenues from mobile equipment sales. Total revenues from mobile
communications, which accounted for 31.5% of total operating
revenues in 2Q04, amounted to Ch$63,577 million (US$99.9
million), representing an increase of 11.1% when compared to
2Q03. This increase is mainly the result of a 32.1% increase in
average cellular subscribers that fuelled an increase in sales
of prepaid equipments in relation to contract equipments. This
was partially offset by a decrease in the average monthly
revenue per user ("ARPU"), due to the application of new CPP
tariffs as of February 12, 2004 and an increase in the
proportion of prepaid customers in Telefonica Movil's subscriber
base. Prepaid customers represented 83.8% of total cellular
subscribers as of June 30, 2004, as compared to 77.2% on the
same date of the previous year. As of June 30, 2004, Telefonica
Movil had 2,738,580 customers, of which, 923,071 are GSM
customers.

Corporate Customer Communications:

Corporate customer communications include revenues from:

(i) telecommunications equipment sales, which refers to voice
equipment (fax, PABX, etc.);

(ii)complementary telephone services, such as 600, 700, 800
numbers and digital communications;

(iii) data services, including ATM, Frame Relay, data equipment
and services related to the IP network, and (iv) dedicated links
and others, including videoconference, Datared, E1 Links and
VSAT, "ISP Empresas" revenues, services such as housing and
hosting and consulting services to corporate customers.

Revenues from corporate customer communications increased by
1.3% to Ch$20,013 million (US$31.5 million) in 2Q04 as compared
to 2Q03. The 9.9% contribution to consolidated operating
revenues, remained stable vs. 2Q03. The increase in revenues was
mainly due to:

(i) a 15.0% increase in data services revenues in 2Q04 as
compared to 2Q03 from increased connectivity services through
the IP network, and (ii) a 13.6% increase in complementary
services to corporate customers.

This was partially offset by:

(i) an 18.9% reduction in revenues from telecommunications
equipment sales due to higher competition and lower sales of
PABX equipment, and (ii) a 8.2% decrease in dedicated links and
others, due to a 2.6% decrease in revenues from Datared services
in favor of more advanced technologies, such as Frame Relay and
ATM. In fact, ATM links increased by 2.2% while data links
through the IP network grew by 57.5%.

Moreover, the average number of customers for switched IP
network decreased by 21.9% in 2Q04 as compared to 2Q03.

Other Businesses:

These revenues include public telephones, as well as revenues
from interior installations and equipment marketing by the
subsidiary CTC Equipos, among others. These revenues which
represented 7.6% of total operating revenues in 2Q04, grew 9.3%
to Ch$15,305 million (US$24.1 million) in 2Q04 vs. 2Q03.

Public telephone revenues increased by 7.7% in 2Q04 to Ch$2,730
million
(US$4.3 million) as compared to 2Q03. Interior installations and
equipment marketing revenues increased by 4.2% in 2Q04 to
Ch$7,779 million (US$12.2 million) compared to 2Q03.

Other businesses revenues, that include revenues from other
subsidiaries such as Telemergencia and t-gestiona, among others,
reached Ch$4,796 million (US$7.5 million) in 2Q04, with a 20.1%
increase compared to 2Q03, mainly due to security services,
connection services to Internet and from Telepeajes.

To See Financial Statements, please visit these sites:
http://bankrupt.com/misc/Stat1.doc
http://bankrupt.com/misc/Stat2.doc

CONTACT:  Ms. Sofia Chellew (schelle@ctc.cl)
          Ms. Veronica Gaete (vgaete@ctc.cl)
          Mr. Maria Jose Rodriguez (mjrodri@ctc.cl)
          Ms. Florencia Acosta (macosta@ctc.cl)
          TELEFONICA CTC CHILE
          Tel.: 562-691-3867
          Fax: 562-691-2392

          Web Site: www.telefonicactcchile.cl



=============
E C U A D O R
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PETROECUADOR: Names Three New VPs
---------------------------------
Petroecuador has made replacements in the posts left vacant
during a recent wave of resignations at the state oil company,
reports Business News Americas.

Oil Engineer Fausto Jara Martines replaces Mr. Jose Luis Zirit
as vice president for Petroproduccion; Mr. Sucre Nevarez, a
trained chemist, replaces Mr. Carlos Luzuriaga as vice-president
for Petroindustrial; finally, Chemical Engineer Romel Samaniego
Tinoco takes over Mr. Hugo Ortiz as vice-president for
Petrocomercial.

The three Petroecuador executives bailed out in the last two
weeks for "personal reasons". The executives have been with the
Company for less than a month when they tendered their
resignations.



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

GRUPO IUSACELL: Loses Bid to Throw Out Bondholders' Suit
--------------------------------------------------------
Grupo Iusacell, S.A. de C.V., Mexico's mobile phone company
controlled by Ricardo Salinas Pliego, lost its bid to persuade a
U.S. court to throw out a lawsuit by holders of a $150 million
defaulted bond issue. Judge Bernard Fried's July 21, 2004 ruling
allows holders of around 32 percent of the $150 million Iusacell
Celular notes to pursue their claims in New York State Supreme
Court, including specific performance claims against Iusacell
such as the granting of first priority liens on a pari passu
basis with other lenders. The judge identified the interest of
the New York court, "sitting in one of the financial capitals of
the world, in adjudicating actions where the parties have chosen
New York as the forum to resolve disputes." The judge's decision
affirms that Iusacell waived its right to litigate claims under
the governing bond indenture in any forum outside of New York.
Judge Fried also ruled that the plaintiffs may maintain their
claims to seek specific performance against Iusacell.

The decision clears the way for the lawsuit initially filed in
January 2004 to proceed against Iusacell in New York Supreme
Court. The holders of the bonds include funds and accounts
managed by Gramercy Advisors LLC, TCW Asset Management Company,
TCW Investment Management Company, and Agave Telecom Holdings
LLC.

"The Mexican press recently quoted an Iusacell officer, Director
General Gustavo Guzman, stating that the company would rather
'invest in technology than pay debt.' With that kind of
attitude, it is clear that creditors have little recourse but to
pursue the remedies provided under our bond indenture as
governed by New York law," said Robert L. Rauch, Managing
Director of Gramercy Advisors.

Grupo Iusacell Celular, the operating subsidiary of Grupo
Iusacell, has total indebtedness of around US$425 million,
including a secured syndicated loan of US$266 million and the
US$150 million of secured bonds. In addition, holding company
Grupo Iusacell has a structurally subordinated US$350 million
bond that matures in 2006. Ricardo Salinas Pliego controls other
NYSE-listed Mexican companies such as Grupo Elektra and TV
Azteca and took control of Grupo Iusacell in July 2003.

CONTACTS:  Manatt, Phelps & Phillips
           Alan M. Feld, 310-312-4153
           afeld@manatt.com
                or
           Canales y Socios
           Ernesto Canales Santos, +52-818 368-0190
           ecanales@canalesysocios.com.mx


GRUPO IUSACELL: Reports Burgeoning Losses in 2Q04
-------------------------------------------------
Grupo Iusacell, S.A. de C.V. (NYSE: CEL - News; BMV: CEL)
(Iusacell or the Company) announced Friday unaudited financial
results for the second quarter ended June 30, 2004(1).

(1)Unless otherwise noted, all monetary figures are expressed in
Mexican pesos as of June 30, 2004 in accordance to Mexican GAAP.
The symbols "P$" and "US$" refer to Mexican pesos and U.S.
dollars, respectively.

Financial Results

Revenue during the second quarter of 2004 decreased 4% from the
previous quarter to P$1,269 million due to lower handset sales
volume. Revenues for the quarter increased 7% compared to the
second quarter in 2003 mainly due to higher handset sales
volume, offset in part by a 3% decrease in service revenues due
a reduction in our rates to contend in the highly competitive
Mexican market. As of June 30, 2004, subscribers totaled
approximately 1.3 million.

Cost of sales during the second quarter of 2004 decreased 18%
from the previous quarter to P$704 million due to lower handset
sales volume. However, this item increased 101% from the second
quarter in 2003 mainly driven by the change in our accounting
policy adopted as of the third quarter of 2003 whereby we now
expense the postpaid handset-related costs rather than amortize
them over the average life of the postpaid contracts, and by
higher costs related to higher traffic.

Operating expenses increased 55% during the second quarter of
2004 as compared to the first quarter of 2004, primarily due to
other income of P$95 million reflected in the first quarter of
2004 in connection to the sale of 46 towers to American Tower
Corporation. The increase was also due, to a lesser extent to i)
an increase of 6% in sales and advertising expenses mainly
driven by an increase in temporary sales employees ii) an
increase of 26% in general and administrative expenses and iii)
other loss related to sales of fixed assets of P$5 million in
the second quarter of 2004. Excluding the other income generated
by the sales of towers in the first quarter of 2004, the
increase of the operating expense would had been 11%.

Operating expenses decreased 5% in the second quarter of 2004 in
comparison with the second quarter of 2003 mainly due to higher
sales and advertising expenses of 3% and a reduction of 27% in
administrative expenses as a result of the implementation of
cost reduction measures.

Operating income before depreciation and amortization decreased
18% to P$188 million from P$228 million in the previous quarter
and also decreased 58% from the second quarter in 2003, both
decreases due to the reasons described above. Excluding the
other income generated by the sale of towers in the first
quarter of 2004 and the other loss from the sale of fixed assets
during the second quarter of 2004, our operating income before
depreciation and amortization would have increased 45% as
compared to the previous quarter.

Depreciation and amortization decreased 25% in the second
quarter of 2004 to P$483 million compared with the second
quarter of 2003 reflecting the Company's decision, adopted
during the third quarter of 2003, of expensing the postpaid
handset-related costs rather than amortizing them over the
average life of the postpaid contracts.

Operating loss in the second quarter of 2004 increased 10% to
P$296 million compared to the previous quarter and increased 48%
from the second quarter in 2003, both as a result of the factors
described above.

Integral financing cost during the second quarter of 2004
increased to P$605 million from P$22 million reflected during
the previous quarter and an integral financing gain of P$19
million during the same quarter of 2003. This result was mainly
driven by an exchange loss of P$357 million caused by the effect
on the Company's U.S. dollar-denominated indebtedness of the
depreciation of the peso compared with the dollar, and a
monetary gain of P$1 million caused by the effect on our net
monetary position of a inflation experienced both during the
second quarter of 2004.

Net loss during the quarter amounted to P$946 million. This
compares to a net loss of P$346 million in the previous quarter
and P$130 million in the first quarter of 2003.

Capital expenditures: Iusacell invested approximately US$11
million during this quarter to expand coverage throughout its
regions.

Recent Developments

Iusacell launched 3rd Generation (3G) services: On July 14,
2004, Iusacell launched 3G Services, a 3G CDMA third-generation
technology that offers a wide range of multimedia applications
that enables subscribers to use their mobile phones as a
communication tool that complements their lifestyles. Iusacell
is the first mobile telephone company in Mexico to offer full
coverage using third-generation technology.

Iusacell also integrated QUALCOMM'S BREW solution intto its
system, thus allowing subscribers to surf and download a variety
of applications, such as e-mail, ring tones, screen savers,
games, and photo transmission, through its mobile telephones.
Iusacell soon plans to offer video transmission features under
this technology.

Debt Restructuring: As part of the Company's ongoing debt
restructuring process, the Company hired in March 2004 the
services of Hill Street Capital LLC, as its financial advisor.
Hill Street Capital LLC is an investment banking firm
established in New York, with experience providing advice and
assistance in the execution of financial strategy, merger and
acquisitions, restructurings, and raising of debt and equity.

The Company, represented by its financial advisor, has held
discussions with a group of its creditors aiming to reach a
comprehensive restructuring agreement in the shortest possible
period. However, the Company cannot predict if, when or how such
an agreement would be reached. Given its difficult financial
situation, the Company does not plan to service the great
majority of its financial indebtedness until a comprehensive
restructuring agreement with its creditors has been reached.

While the Company works with its advisors toward a comprehensive
debt restructuring plan, it continues with its normal daily
operations, offering quality products and services that satisfy
the needs of its customers, with a constant commitment to renew
and launch new products and state-of-the-art technology
services.

About Iusacell

Grupo Iusacell, S.A. de C.V. (Iusacell, NYSE and BMV: CEL) is a
wireless cellular and PCS service provider in Mexico
encompassing a total of approximately 92 million POPs,
representing approximately 90% of the country's total
population. Independent of the negotiations towards the
restructuring of its debt, Iusacell reinforces its commitment
with customers, employees and suppliers and guarantees the
highest quality standards in its daily operations offering more
and better voice communication and data services through state-
of-the-art technology, such as its new 3G network, throughout
all of the regions in which it operate.

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

CONTACTS:  Ricardo Salinas Pliego, Chairman
           Gustavo Guzman, CEO, Director
           GRUPO IUSACELL SA DE CV
           Prolongacion Paseo, De La Reforma 1236
           Mexico, D.F.,  05348
           Phone: (525) 109-4400
           Web Site: http://www.iusacell.com.mx


GRUPO MEXICO: Union Pays No Heed to Labor Court's Ruling
--------------------------------------------------------
Union workers at Grupo Mexico SA, Mexico's largest copper
producer, voted to continue a strike at the company's La Caridad
mine despite a labor court ruling ordering them to go back to
work. In a statement, the union revealed that the miners decided
to remain on strike because they believe that the Company is in
breach of its labor contract, including the payment of a profit-
sharing bonus.

"The cost of profit sharing, one of the points with no progress
in the talks, doesn't even equal the losses to the company
caused by one day of a strike," the union said, adding that they
will take the matter to the federal court.

Under the ruling, Grupo Mexico has the right to fire the miners
and replace them with new workers, said Juan Rebolledo, a
spokesman for Grupo Mexico.

"What we want is for all of them to return to work," Rebolledo
said.

Rebolledo said the company can't pay a profit-sharing bonus
because it had losses in 2003.

Meanwhile, workers at Grupo Mexico's Cananea copper mine and its
zinc refinery in San Luis Potosi state extended their strike
deadline to Monday, the National Mining, Metallurgical and
Similar Workers Union said in a press release.

About 100 workers at a Grupo Mexico lime plant in Sonora went on
strike Friday.

CONTACT:  Mr. German Larrea Mota Velasco
          Chairman & CEO
          GRUPO MEXICO
          Av. Baja California No. 200
          Colonia Roma Sur
          06760 Mexico, D.F.
          Tel. Conm. 52 (55) 5080-0050


GRUPO TMM: Amends Tender Quotas in Exchange Offer
-------------------------------------------------
Grupo TMM, S.A. (NYSE:TMM - News; BMV:TMM A) announced Friday
that it has extended and amended its previously announced
exchange offer and consent solicitation for its 9 1/2 percent
Notes due 2003 ("2003 notes") and its 10 1/4 percent Senior
Notes due 2006 ("2006 notes").

Grupo TMM is reducing the percentage of outstanding 2003 notes
required to be tendered in the exchange offer from 98 percent to
95.7 percent and increasing the percentage of outstanding 2006
notes required to be tendered from 95 percent to 97.3 percent.
All other conditions to the exchange offer and consent
solicitation remain unchanged.

As of 5:00 p.m., New York City time, on July 22, 2004,
$169,324,000 principal amount of the 2003 notes and $194,771,000
principal amount of the 2006 notes had been tendered and not
withdrawn (including tenders of notes pursuant to guaranteed
deliveries).

Based on the principal amount of 2003 notes and 2006 notes
tendered to date, the minimum tender conditions would be
satisfied and the Company would have sufficient consents from
the holders of the 2006 notes to implement the amendment to the
indenture governing the 2006 notes, which will eliminate
substantially all of the restrictive covenants in the 2006 notes
that are not tendered and remain outstanding following
completion of the exchange offer.

In addition, the Company believes it has received votes from
sufficient holders to permit it to accomplish the restructuring
through a prepackaged plan of reorganization on substantially
the same terms as the exchange offer if the conditions to the
exchange offer are not achieved due to withdrawals of previously
tendered notes or otherwise.

In conjunction with the amendment to the exchange offer and
consent solicitation, Grupo TMM has extended the expiration date
for the exchange offer and consent solicitation and the
solicitation of acceptances to the U.S. prepackaged plan until
midnight, New York City time, on August 5, 2004. Grupo TMM is
also providing withdrawal rights to all holders of 2003 notes
and 2006 notes, including holders whose notes have previously
been tendered. Withdrawal rights will expire at midnight New
York City time, on the expiration date. Any holder who tendered
2003 notes or 2006 notes prior to 5:00 p.m., New York City time,
on July 16, 2004, which was the consent fee deadline, and
subsequently withdraws its notes, will no longer be entitled to
receive the consent fee payment with respect to the notes that
are withdrawn. Any questions as to the withdrawal of notes may
be directed to the information agent at the numbers below.

In addition, Grupo TMM filed Friday with the Securities and
Exchange Commission a Prospectus Supplement, which includes
additional disclosure. Holders of existing notes are urged to
review the Prospectus Supplement and the Prospectus and
Solicitation Statement previously filed with the Securities and
Exchange Commission.

Headquartered in Mexico City, Grupo TMM is Latin America's
largest multimodal transportation company. Through its branch
offices and network of subsidiary companies, Grupo TMM provides
a dynamic combination of ocean and land transportation services.
Grupo TMM also has a significant interest in TFM, which operates
Mexico's Northeast railway and carries over 40 percent of the
country's rail cargo. Grupo TMM's web site address is
www.grupotmm.com and TFM's web site is www.tfm.com.mx. Grupo TMM
is listed on the New York Stock Exchange under the symbol TMM
and Mexico's Bolsa Mexicana de Valores under the symbol "TMM A."

The exchange offer and consent solicitation are made solely by
the Prospectus and Solicitation Statement dated June 23, 2004,
as amended by the Prospectus Supplement dated July 23, 2004.
Copies of the Prospectus and Solicitation Statement, the
Prospectus Supplement and the other transmittal materials can be
obtained from Innisfree M&A Incorporated, the information agent
for the exchange offer and consent solicitation, at the
following address:

Innisfree M&A Incorporated
501 Madison Avenue, 20th Floor
New York, New York 10022
Toll Free: (877) 750-2689
Fax: (212) 750-5799

CONTACT: Grupo TMM
         Investor Relations
         Mr. Brad Skinner, 011-525-55-629-8725 or 203-247-2420
         brad.skinner@tmm.com.mx
             or
         Proa/StructurA
         Media Relations
         Mr. Marco Provencio,
         011-525-55-629-8708 and 011-525-55-442-4948
         mp@proa.structura.com.mx
             or
         Dresner Corporate Services
         General Investors, Analysts and Media
         Ms. Kristine Walczak, 312-726-3600
         kwalczak@dresnerco.com


TV AZTECA: Profit Hampered by High Costs, Weak Peso
---------------------------------------------------
Steep production costs and a weak peso could pull down TV
Azteca's net profit by 32 percent in the second quarter of 2004,
says industry analysts consulted by Reuters. TV Azteca, Mexico's
second largest broadcaster, invested heavily this year in new
programs for its U.S. subsidiary Azteca America. With improved
programming, the company is steering itself to conquer the
lucrative Hispanic audience in the U.S.

The peso's poor performance in the second quarter could also
make a significant impact on the Company's bottom line. The 3
percent fall in the currency during the period translated to
higher servicing costs for the Company's foreign currency debt.

The analysts predict that Azteca could post a net of MXN391
million (US$34 million) in the second quarter of 2004, down from
the MXN574 million recorded in the same period last year. While
the analysts foresee a 1.23 percent increase in revenue, EBITDA
is expected to fall 2.51 percent or MXN894 million.



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

PAN AMERICAN: To Complete Morococha Acquisition In August
---------------------------------------------------------
Pan American Silver Corp. (PAAS: NASDAQ; PAA: TSX) launched its
US$36.7 million cash offer, through the Peru Stock Exchange, to
purchase the voting shares of Compania Minera Argentum S.A.
("Argentum"), which owns the Morococha silver mine, as announced
in February. Pan American has a lock-up agreement to acquire 92%
of Argentum's voting shares. The public offering must remain
open for 20 business days, after which the purchase of Morococha
will be completed.

In addition, Pan American has acquired 100% of Compania Minera
Natividad ("Natividad") for US$1.5 million, which holds numerous
adjacent mineral concessions. Pan American intends to combine
Natividad with Argentum upon completion of the public offering,
which, assuming 100% of the common shares of Argentum are
tendered to Pan American, will give the Company an 88% interest
in the Morococha silver mine.

According to Pan American's President and CEO, Geoff Burns,
"Morococha is an excellent addition to our Peruvian assets and
will provide immediate silver production, positive cash flow and
profits for the Company. Coupled with the mine's outstanding
exploration potential, we see Morococha as a cornerstone of Pan
American's operations for many years to come."

CONTACT: Brenda Radies, VP Corporate Relations (604) 684-1175
         Web site: http://www.panamericansilver.com



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

PDVSA: Considering Argentine Expansion
--------------------------------------
State-owned oil company Petroleos de Venezuela S.A. (PDVSA) is
looking at the possibility of expanding to Argentina by opening
Citgo gas stations in the South American country, reports Dow
Jones. PDVSA, through Citgo, manages gas stations in Brazil,
Guatemala and the United States, where it has 13,500 gas
stations.

PDVSA President Ali Rodriguez recalls that PdVSA was exploring
the possibility of establishing a footprint in Argentina through
Citgo service stations a year ago but plans were derailed by the
political instability that hit Argentina.

"We'll renew that long-held initiative once we have an office in
Buenos Aires," Dow Jones Newswires quoted Rodriguez as saying.
"We're talking to business people in Argentina to see what we
can do together," on this issue, he noted.


PDVSA: Gross Revenues to Top $46B in 2004
-----------------------------------------
PDVSA executives made differing estimates on how much revenue
from oil sales the corporation is going to post at the end of
2004, says El Universal.

Mr. Jose Rojas, PDVSA Vice President of Finance said Thursday
that the corporation's revenues from oil sales in 2004 are to
total US20 billion, with a tax contribution of US$10 billion.
Nevertheless, he stressed that if oil prices continue to exceed
US$30, the firm's tax contribution to the Treasury could amount
to US13 billion.

PDVSA President Ali Rodriguez, on the other hand, said that
PDVSA's revenues from oil sales are to amount to US$46 billion.
Therefore, the corporation's tax contribution would total US$20
billion.

Despite the vast difference in the projected figures, Mr. Rojas
claimed "the amounts (he presented) do not differ from Ali
Rodriguez' estimations."



                            ***********


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