TCRLA_Public/040823.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

             Monday, August 23, 2004, Vol. 5, Issue 166

                            Headlines

A R G E N T I N A

BOBIGRAL S.A.: Court Favors Creditor's Bankruptcy Petition
CITO S.A.: Validation of Claims Nears End
ESCARPIN S.R.L.: Liquidates Assets to Pay Debts
FARMACIA DEL NORTE: General Report Due Tomorrow
GOLDEN FURS: Initiates Bankruptcy Proceedings

GUSTUS S.A.: Verification Deadline Approaches
HOSANTEL: Gears for Reorganization
LAURO S.A.: Declared Bankrupt by Court
MC TRADING: Court Orders Liquidation
M.V.D S.A.: Court Issues Liquidation Order

RATTAZZI Y COMPANA: Verification Deadline Approaches
SOL NACIENTE: Court Converts Bankruptcy to Reorganization
TRANSLIQ: Trustee to Submit Individual Reports
V LEHMANN: Claims Check Ends Wednesday
VINTAGE PETROLEUM: Declares US$.05 Cash Dividend per Share


B E R M U D A

LORAL SPACE: Expects to Exit Chapter 11 by Yearend


B R A Z I L

PARMALAT: Sues CSFB Under Italian Bankruptcy Law
SABESP: S&P Affirms Local, Foreign Currency Ratings
TELEMAR: Mobile Phone Subsidiary Registers 5.3M Subscribers
VARIG: Government Wants to Implement Rescue Plans At Once


C H I L E

AES GENER: Posts Earnings Of CLP12,432 Mln for Period Ended 6/30
ENAMI: Mining Committee Schedules Another Voting on Bill
SHELL CHILE: Repsol-YPF, Petrobras Eyeing Chilean Assets


C O S T A   R I C A

* COSTA RICA: IMF Wraps-up Article IV Consultation


D O M I N I C A N   R E P U B L I C

CDEE/EDENORTE/EDESUR: To Face EGE Haina in Court
TRICOM: Reports Improved Second Quarter 2004 Results
* DOMINICAN REPUBLIC: IMF Assures Support for New Government


M E X I C O

GALEY & LORD: Files Voluntary Bankruptcy Petition
ISSSTE: Close to Belly-Up
VOLKSWAGEN: Pay Dispute Shuts Down Puebla Plant


T R I N I D A D   &   T O B A G O

NWRHA: Board Frustrates JSC

     -  -  -  -  -  -  -  -

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

BOBIGRAL S.A.: Court Favors Creditor's Bankruptcy Petition
----------------------------------------------------------
Asociacion de Prestacion Social para Empresarios, Personal de
Direccion de Empresas de la Produccion, Industria, Comercio y
Servicios successfully sought the bankruptcy of Biobigral S.A.
after Court No. 19 of Buenos Aires' Civil and Commercial
Tribunal declared the Company "Quiebra," says Clarin.

The creditor requested the Company's bankruptcy after the latter
failed to pay debts amounting to US$5,125.23. Clerk No. 38
assists the court on the case, which will culminate in the
liquidation of all the Company's assets.

CONTACT: Biobigral S.A.
         Larrazabal 1031
         Buenos Aires


CITO S.A.: Validation of Claims Nears End
-----------------------------------------
The verification of claims for the Cito S.A. bankruptcy will end
on Wednesday, August 25, 2004. Creditors should submit proofs of
the Company's indebtedness to court-appointed trustee Ms. Zulma
Glave before the deadline.

Judge Villanueva of Buenos Aires Court No. 23 endorsed the
liquidation upon the request of Maxipress S.A., who has claims
totaling US$27,000 against the Company.

CONTACT: Cito S.A.
         Florida 50
         Buenos Aires

         Ms. Zulma Galve, Trustee
         Deheza 4883
         Buenos Aires


ESCARPIN S.R.L.: Liquidates Assets to Pay Debts
-----------------------------------------------
Buenos Aires-based Escarpin S.R.L. will begin liquidating its
assets following the pronouncement of the city's Court No. 18
that the company is bankrupt, Infobae reports.

The ruling places the company under the supervision of court-
appointed trustee, Mr. Mario Enrique Galanti Podesta. The
trustee will verify creditors' proofs of claims until October
20, 2004.

The bankruptcy process will end with the disposal company assets
to repay its debt obligations.

CONTACT: Mr. Mario Enrique Galanti Podesta, Trustee
         Cramer 2175
         Buenos Aires


FARMACIA DEL NORTE: General Report Due Tomorrow
-----------------------------------------------
A general report on the Farmacia del Norte S.R.L. bankruptcy is
scheduled for court submission tomorrow, August 24, 2004. The
case's trustee, Mr. Humberto Enrique Zaina, will prepare this
report from the Company's accounting and business records.

Court No. 12 of Buenos Aires' Civil and Commercial Tribunal
handles this case with assistance from the city's Clerk No. 23.

CONTACT:  Humberto Enrique Zaina, Trustee
          Esmeralda 320
          Buenos Aires


GOLDEN FURS: Initiates Bankruptcy Proceedings
---------------------------------------------
Court No. 22 of Buenos Aires' Civil and Commercial Tribunal
declared local company Golden Furs S.R.L. "Quiebra," reports
Infobae.

Ms. Graciela Silvia Turco, who has been appointed as trustee,
will verify creditors' claims until October 7, 2004 and then
prepare the individual reports based on the results of the
verification process.

The individual reports will then be submitted in court on
November 18, 2004, followed by the general report on February 2
next year.

Clerk No. 44 assists the court on the case, which will close
with the liquidation of the Company's assets to repay creditors.

CONTACT: Ms. Graciela Silvia Turco, Trustee
         Cochabamba 4272
         Buenos Aires


GUSTUS S.A.: Verification Deadline Approaches
---------------------------------------------
Creditors of bankrupt company Gustus S.A. must submit proofs of
their claims before the verification period closes on Wednesday,
August 25, 2004. All documents should be forwarded to court-
appointed trustee Ms. Edith Ghiglione.

Court No. 5 of Buenos Aires' Civil and Commercial Tribunal
handles this case with the assistance of Clerk No. 10.

CONTACT: Ms. Edith Ghiglione, Trustee
         Paraguay 1225
         Buenos Aires


HOSANTEL: Gears for Reorganization
----------------------------------
Court No. 25 of Buenos Aires' Civil and Commercial Tribunal,
with assistance from Clerk No. 49, issued a resolution opening
the reorganization of Hosantel S.A., says Infobae.

The pronouncement authorizes the Company to begin drafting a
settlement proposal with its creditors in order to avoid
liquidation. The reorganization further allows the Company to
retain control of its assets subject to certain conditions
imposed by Argentine law and the oversight of the court
appointed trustee.

Mr. Carlos Felix Pisa Barros Garcia will serve as trustee during
the course of the reorganization. He will be validating
creditors' proofs of claims until September 27, 2004. The
results of the verification will be presented in court as
individual reports on November 9, 2004.

The trustee is also required to give a general report of the
case on December 22, 2004. The general report summarizes events
relevant to the reorganization and provides an audit of the
Company's accounting and business records.

The Company will present the completed settlement proposal to
its creditors during the informative assembly scheduled on June
24 next year.

CONTACT: Mr. Carlos Felix Pisa Barros Garcia, Trustee
         Avda Corrientes 3150
         Buenos Aires


LAURO S.A.: Declared Bankrupt by Court
--------------------------------------
Court No. 2 of Buenos Aires' Civil and Commercial Tribunal
issued a resolution declaring the bankruptcy of local company
Lauro S.A., reports Clarin. This order signals the Company to
proceed with the liquidation of its assets in order to repay its
debt obligations.

Clerk No. 3 assists the court in the resolution of this case.

CONTACT: Lauro S.A.
         Suipacha 1031
         Buenos Aires


MC TRADING: Court Orders Liquidation
------------------------------------
Mc Trading S.R.L. prepares to wind-up its operations following
the bankruptcy pronouncement issued by Court No. 22 of Buenos
Aires' Civil and Commercial Tribunal. The declaration
effectively prohibits the company from administering its assets,
control of which will be transferred to a court-appointed
trustee.

Infobae reports that the court selected Mr. Raul Manuel Pereyra
as trustee. He will be reviewing creditors' proofs of claims
until October 8, 2004. The verified claims will be the basis for
the individual reports to be presented for court approval on
November 19, 2004. Afterwards, the trustee will also submit a
general report on February 3 next year.

Clerk No. 44 assists the court on this case, which will end with
the disposal of the company's assets to cover its liabilities.

CONTACT: Mr. Raul Manuel Pereyra, Trustee
         Parana 467
         Buenos Aires


M.V.D S.A.: Court Issues Liquidation Order
----------------------------------------
Buenos Aires-based marketing firm M.V.D. S.A. proceeds with the
liquidation of its assets upon the approval given by Court No. 7
of the city's Civil and Commercial Tribunal, says Clarin.

The Company entered into bankruptcy protection after defaulting
on its debt obligations. During this phase, control of the
Company's assets will be transferred to a court-appointed
trustee.

Clerk No. 14 assists the court on this case.

CONTACT: M.V.D. S.A.
         Avenida de Mayo 1410
         Buenos Aires


RATTAZZI Y COMPANA: Verification Deadline Approaches
----------------------------------------------------
The verification of creditor's claims for the Rattazzi y Compana
bankruptcy is scheduled to end on Wednesday, August 25, 2004.
Creditors should file their claims with the court-appointed
trustee Mr. Mario Sebastian Colla before the said date. Failure
to comply with the filing deadline will mean disqualification
from the list of creditors eligible to receive post liquidation
payments.

Court No. 13 of San Isidro's Civil and Commercial Tribunal has
jurisdiction over this case, which will end with the sale of all
the Company's assets to repay its debt obligations.

CONTACT: Rattazzi y Compania S.R.L.
         Miguel Cane 1350
         San Fernando

         Mr. Mario Sebastian Colla, Trustee
         Ituzaingo 349
         San Isidro


SOL NACIENTE: Court Converts Bankruptcy to Reorganization
---------------------------------------------------------
Sol Naciente Express S.A. will proceed with reorganization after
Buenos Aires Court No. 23 converted the Company's ongoing
bankruptcy case into a "concurso preventivo", states Infobae.

Under Insolvency protection, the Company will be able to draft a
proposal designed to settle its debts with creditors. The
reorganization also prevents the Company's outright liquidation.

Ms. Liliana Noemi Castineira, the court-appointed trustee, will
verify creditors' proofs of claims "por via incidental". She is
also required to submit a general report of the case on November
22, 2004.

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


TRANSLIQ: Trustee to Submit Individual Reports
----------------------------------------------
Ms. Nora Margarita Maldonado, in her capacity as trustee for the
Transliq S.R.L. bankruptcy, is set to submit individual reports
from the case tomorrow, August 24, 2004.

The reports are based on all creditors' claims forwarded during
the credit verification period. Court No. 2 of Rio Cuarto's
(Cordoba) Civil and Commercial Tribunal will use these reports
to decide on the final list of creditors eligible for post
liquidation payments.

CONTACT: Transliq S.R.L.
         Corrientes 236 Elena
         Cordoba


V LEHMANN: Claims Check Ends Wednesday
--------------------------------------
The result of the credit verifications for the V. Lehmann S.A.
bankruptcy will be submitted in court on Wednesday, August 25,
2004, as individual reports. Mr. Ruben Joaquin Toytoyndjian, the
court-appointed trustee, will prepare these reports along with
the general report that is also scheduled for submission on
October 5, 2004.

Court No. 14 of Buenos Aires' Civil and Commercial Tribunal
assisted by Clerk No. 28, has jurisdiction over the Company's
bankruptcy case.

CONTACT: Mr. Ruben Joaquin Toytoyndjian, Trustee
         Luis Saenz Pena 1219
         Buenos Aires


VINTAGE PETROLEUM: Declares US$.05 Cash Dividend per Share
----------------------------------------------------------
Vintage Petroleum, Inc. announced Thursday that its Board of
Directors has authorized a cash dividend of five cents per
share. The company said the dividend will be paid October 5,
2004, to stockholders of record on September 21, 2004.

Vintage Petroleum, Inc. is an independent energy company engaged
in the acquisition, exploitation and exploration of oil and gas
properties and the marketing of natural gas and crude oil.

Company headquarters are in Tulsa, Oklahoma, and its common
shares are traded on the New York Stock Exchange under the
symbol VPI.

CONTACT: Mr. Robert E. Phaneuf
         Vice President - Corporate Development
         Vintage Petroleum Inc
         110 West Seventh Street
         Tulsa, OK 74119
         Phone: (918) 592-0101
         Fax: (918) 584-7282
         Web Site: www.vintagepetroleum.com



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

LORAL SPACE: Expects to Exit Chapter 11 by Yearend
--------------------------------------------------
Loral Space & Communications Ltd. (OTCBB: LRLSQ) and certain of
its subsidiaries filed Thursday a proposed plan of
reorganization (the Plan) with the U.S. Bankruptcy Court for the
Southern District of New York. The Plan is supported by the
Official Committee of Unsecured Creditors appointed in Loral's
chapter 11 case. The company expects to exit chapter 11 under
current management before the end of the year.

The Plan, which is subject to confirmation by the bankruptcy
court, resulted from negotiations between the company and the
Creditors' Committee to implement the previously announced
agreement in principle.

It provides, among other things, that:

- Loral's two businesses, Space Systems/Loral and Loral Skynet,
will emerge intact as separate subsidiaries of reorganized Loral
(New Loral).

- Space Systems/Loral, the satellite design and manufacturing
business, will emerge debt-free.

The common stock of New Loral will be owned by Loral
bondholders, Loral Orion bondholders and other unsecured
creditors. In addition, bondholders and other creditors of Loral
Orion will receive an aggregate of $200 million in new senior
secured notes to be issued by reorganized Loral Skynet, New
Loral's satellite services subsidiary.

New Loral will emerge as a public company and will seek listing
on a major stock exchange.

Existing common and preferred stock will be cancelled and no
distribution will be made to current shareholders.

The plan of reorganization is available via the court's website,
at www.nysb.uscourts.gov/. Please note that a PACER password is
required to access documents on the Bankruptcy Court's website.
Loral's bankruptcy case number is 03-41710 (RDD).

Loral Space & Communications is a satellite communications
company. It owns and operates a fleet of telecommunications
satellites used to broadcast video entertainment programming,
distribute broadband data, and provide access to Internet
services and other value-added communications services.

Loral also is a world-class leader in the design and manufacture
of satellites and satellite systems for commercial and
government applications including direct-to-home television,
broadband communications, wireless telephony, weather monitoring
and air traffic management.

To view Loral's reorganization plan:
http://bankrupt.com/misc/loral.pdf

CONTACT: Ms. Jeanette Clonan
         Mr. John McCarthy
         Loral Space & Communications
         212/697-1105



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

PARMALAT: Sues CSFB Under Italian Bankruptcy Law
------------------------------------------------
Parmalat Finanziaria S.p.A. in Extraordinary Administration
communicates that Extraordinary Commissioner Dr. Enrico Bondi,
in his role as Extraordinary Commissioner of Parmalat S.p.A.,
has filed a claim with the Court of Parma against Credit Suisse
First Boston International ("CSFB") in the form of a revocatory
action under article 67 of the Italian bankruptcy law in
connection with a Forward Sale Agreement dated January 2002
between CSFB and Parmalat.

The Forward Sale Agreement ("the Agreement") that is the subject
of the action was part of broader transaction involving a loan
in the form of a convertible bond for a total amount of EUR500
million issued by Parmalat Partecipacoes do Brasil Ltda and
entirely underwritten by CSFB.

Under the Agreement CSFB sold forward, to Parmalat, CSFB's
conversion rights under the above mentioned EUR500 million
convertible bond issue, in return for the early payment by
Parmalat to CSFB of a sum of EUR248.3 million. The amount being
sought in restitution by Parmalat from CSFB under this
revocatory action is EUR248.3 million plus interest.

Further, the Extraordinary Commissioner has reserved the right
to act separately to recover damages from CSFB.

CONTACTS: Parmalat Finanziaria
          piazza Erculea 9, 20122
          Milano (MI), ITALIA.
          Phone: +39 02 8068801
          Fax: +39 02 8693863
          E-mail: x_affari_societari_it@parmalat.net

          Parmalat Partecip. Do Brasil Ltda
          Rua Gomes de Carvalho
          1629 - CEP 04547-005
          Sao Paulo, SP.


SABESP: S&P Affirms Local, Foreign Currency Ratings
---------------------------------------------------
Standard & Poor's Ratings Services has assigned its 'brA'
Brazilian national scale rating to Companhia de Saneamento
Basico do Estado de Sao Paulo's (SABESP) sixth debenture
issuance in the total amount of BrR600 million due in 2010. At
the same time, Standard & Poor's affirmed SABESP's 'BB-' local
and 'B+' foreign currency ratings, as well as its 'brA' national
scale rating. The outlook on the corporate foreign currency
rating is positive, and the outlooks on the local and national
scale ratings are stable.

This debenture issuance will be used entirely to amortize 2004's
debts, mainly the significant amount concentrated in September
(approximately BrR400 million). The notes will be issued under a
two-year BrR1.5 billion shelf-registration program that is
expected to be used to roll over the company's long-term debt
maturities.

The local currency and national scale ratings on SABESP reflect
the lack of a defined regulatory framework for the water utility
sector; significant refinancing needs in the upcoming years,
including the high volume of dollar-denominated debt without
hedging instruments, considering the intrinsic volatility of the
Brazilian economy; and a large amount of past-due receivables
mainly from wholesale water sales to public
entities/municipalities.

These risks are partially offset by SABESP's strategic
importance as a regional provider of water and wastewater
service in the state of Sao Paulo, covering a large and broad
territory with a virtual monopoly for service, and its capacity
to progress in its capital-development program that will allow
comprehensive water-service coverage as well as expanded
wastewater collection and treatment capability through the
system. Additionally, the company is a strong cash generator and
has been demonstrating capacity to raise resources through the
capital markets and development banks to deal with its debt
maturities and large capital-expenditure requirements.

The positive outlook on the foreign currency rating reflects
that of the sovereign foreign currency rating, and the stable
outlooks on the local currency and national scale ratings
reflect Standard & Poor's expectations that SABESP will continue
to receive approval from the state government to adjust tariffs
in such a way as to maintain its capacity to generate free cash
flow, continue to experience good access to capital markets, and
fund much of its capital program through programs with
multilateral banks. A change in outlook would come from a more
robust decrease in leverage (EBITDA to total debt to 38% and
total debt to EBITDA to 2.5x), which is not currently
anticipated. On the other hand, the local currency and national
scale ratings would face downward pressure if the impact on cash
flow of the water-saving incentive campaign is stronger than
anticipated, or if tariff adjustment fails to cover cost
pressures.

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


TELEMAR: Mobile Phone Subsidiary Registers 5.3M Subscribers
-----------------------------------------------------------
Tele Norte Leste Participacoes S.A. (NYSE:TNE) announced
Thursday that Oi (TNL PCS), a wholly-owned subsidiary of its
operational arm Telemar Norte Leste (Bovespa: TMAR) ended July
2004 with 5,295,000 customers, up nearly 4% from June 2004 and
121% from July 2003. The customer mix comprised 85% subscribers
under prepaid plans and 15% post-paid.

The market share of net additions in Region I was 36% during the
month. Postpaid customers accounted for 18% of the net additions
during the month. This reinforces the strategy pursued by Oi,
focused on the development and marketing of bundled products
with the fixed line business, targeted mainly at the post-paid
segment.

With this expansion, Oi achieves an estimated market share of
21,4% in its region, and is on track to reach the estimated 6.5
million subscribers base by year-end 2004.

CONTACTS: TNE Investor Relations

          Mr. Roberto Terziani
          (terziani@telemar.com.br)
          55 21 3131 1208
                or
          Mr. Carlos Lacerda
          (carlosl@telemar.com.br)
          55 21 3131 1314
          Fax: 55 21 3131 1155

          The Global Consulting
          Mr. Kevin Kirkeby
          (kkirkeby@hfgcg.com)
          Tel: 1 646.284.9416


VARIG: Government Wants to Implement Rescue Plans At Once
---------------------------------------------------------
The head of Brazil's state-run airport authority Infraero
revealed Thursday that the government is discussing plans to
take temporary control of troubled flagship Varig and then sell
it to a private investor.

Reuters reports that Infraero President Carlos Wilson suggested
that the plan should be carried out as soon as possible to save
the heavily indebted airline.

Varig has debts totaling BRL6 billion (US$2 billion), two-thirds
of which is held by the government and state-run companies.

"The company is practically state-owned as it is the government
that is sustaining it. It is us who are injecting funds and
having patience not to execute debts," Wilson said.

He said Varig's controlling entity, the Ruben Berta Foundation,
would have a symbolic participation in the new Varig that will
be offered for sale.

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

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



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

AES GENER: Posts Earnings Of CLP12,432 Mln for Period Ended 6/30
----------------------------------------------------------------
Gener S.A., the largest thermal electricity generation group in
Chile, reported its results for the first half of 2004, with
earnings of CLP12,432 million compared with earnings of
CLP30,247 million in the first half of 2003.

Highlights:

- In connection with our recent debt restructuring plan, on June
19, 2004, we completed our capital increase totaling CLP62,268
million (US$98.0 million).

- April 16, 2004, we completed the restructuring of the debt of
TermoAndes and InterAndes, as well as the termination of the
interest rate swaps covering this debt.

- Node Price established in April, valid from May to October of
2004, increased 18% in pesos and 12% in dollars.

- Higher demand growth in the first half of 2004 as compared to
the same period in 2003, reaching 7.2% in Chile and 3.1% in
Colombia.

- On June 17, 2004, the Secretary of Energy in Argentina issued
Resolution 659/04 which replaced Rule 27/04 and established a
new methodology for determining natural gas sales into the
domestic market based on each producer's level of committed
supply to Argentine consumers. This measure reduced gas
curtailments to Chile from over 7 million m3 per day to less
than 3 million m3 per day.

- On July 13, 2004, AES Gener and Electrica Santiago presented a
demand for arbitration at the International Chamber of Commerce
against our natural gas suppliers, claiming breach of contract
and compensation for supply curtailments.

Consolidated Quarter Analysis

Amounts are in accordance with Chilean generally accepted
accounting principles and expressed in constant Chilean pesos as
of June 30, 2004, therefore, figures of June 30, 2003 have been
adjusted by Chilean CPI for the period of 0.6%.

Consolidated Revenues

In the quarter ended June 30, 2004 consolidated revenues
increased 3% to CLP97.4 billion, compared to CLP94.5 billion in
the same quarter of the previous year.

This decrease was mainly due to a) higher sales to regulated
customers of CLP6.2 billion, which include sales to Chilectra,
Chilquinta, Rio Maipo and R.M. 88, attributable to the node
price increase and higher sales to Chilquinta, b) higher sales
to other customers in Chile of CLP3.4 billion and c) higher
sales to Escondida of CLP0.7 billion as a result of a 13%
increase in energy sales.

This increase was partially offset by a) lower sales in Colombia
of CLP4.4 billion as a result of a drop of 21% in energy sales,
b) lower sales to the CDEC of CLP2.2 billion attributable to a
37% decrease in energy sales and c) lower coal sales and others
of CLP0.8 billion.

Consolidated Operating Costs

This increase was partially offset by a decrease of a) energy
purchase of CLP2.7 billion, as a consequence of 53% lower
purchases, and b) fixed costs of CLP2.2 billion, mainly due to a
lower exchange rate to convert the costs of our foreign
subsidiaries.

Consolidated Administration and Sales Costs

There was a slight raise of 4% in consolidated administration
and sales costs during the second quarter of 2004 as compared to
the second quarter of 2003. The main reason for this variation
was an increase of CLP0.8 billion in the costs related to
salaries and employee benefits, municipality taxes and others.
This effect was compensated by a decrease of CLP0.6 billion in
the items system and communication, external services and
insurance.

Operating Income and EBITDA

The operating income for the second quarter of 2004 was CLP26.7
billion, 14% lower than CLP30.8 billion for the second quarter
of 2003. The operating income decrease is attributable to the
11% increase of the operating costs mainly due to the higher
costs of fuel consumption, which was not offset by the 3%
revenues increase.

In the quarter ended June 30, 2004, EBITDA margin reached
CLP33.2 billion, 13% lower than the EBITDA of CLP38.1 billion
recorded in the quarter ended June, 2003. In dollar terms, using
the corresponding exchange rate, EBITDA decreased 4.2% from US$
54.5 million to US$ 52.2 million.

Non-Operating Results

During the second quarter of 2004, the Company's non-operating
loss was CLP22.5 billion, 103.5% higher than the second quarter
of 2003. This was mainly due to a) higher financial expenses of
CLP5.6 billion associated to the extraordinary costs related to
the early termination of the interest rate swap of TermoAndes
and InterAndes in the refinancing of their floating rate notes,
b) lower financial income of CLP5.2 billion related to the
mercantile account between AES Gener and the Holding company
Inversiones Cachagua, which outstanding interests and principal
were paid on February 27, 2004, c) lower contribution from
equity share in related companies of CLP4.4 billion, primarily
due to the net income decrease of Electrica Guacolda, and d)
decrease of CLP0.7 billion of other items. On the other hand,
the line other non-operating expenses decreased CLP4.4 billion,
attributable to the higher costs associate to the supplies and
inventories write-off during the second quarter of 2003.

Net Income

Net income for the quarter ended June 30, 2004 was CLP1.7
billion, CLP12.9 billion lower than the net income of CLP14.6
billion for the period ended June 30, 2003. The main variations
were a) higher costs related to the increase in the fuel
consumption of our thermal power plants, b) less financial
income associated to the mercantile current account, paid in
February of 2004 and, c) higher financial expenses related to
the debt restructuring of TermoAndes an InterAndes. The positive
effect of the debt restructuring process of the company was
offset by this higher extraordinary cost, however we expect an
important decrease in financial expenses for the second half of
the year.

Quarter Analysis by Subsidiaries

Electrica Santiago

The gas shortage in Argentina had a negative effect on Electrica
Santiago. During the second quarter of 2004, net income recorded
losses of CLP0.2, which is CLP3.3 billion lower than the
earnings of CLP3.1 billion for the period ended June 30, 2003.
Operating income decreased CLP1.8 billion, from CLP2.8 billion
for the quarter ended June 30, 2003 to CLP1.9 billion for the
quarter ended June 30, 2004, as a consequence of a 2% decrease
in earnings and a 10% increase in operating costs. The raise in
operating costs is mainly attributable to a higher average spot
price, which increased energy purchase costs from CLP0.7 billion
to CLP6.5 billion, which was offset by the extraordinary
settlement of CLP3.2 billion pesos from the settlement of the
construction contract among Electrica Santiago and General
Electric. Additionally, in spite of the lower plant dispatch,
the fuel consumption cost was similar for both quarters due to a
higher fuel cost related to the oil used to replace gas for same
periods during the second quarter of 2004.

Non-operating losses increased CLP1.2 billion, from CLP0.2
billion for the second quarter of 2003 to CLP1.4 billion for the
second quarter of 2004, mainly due to the higher negative
exchange rate effect of CLP1.7 billion, which was offset by a
lower price-level restatement and financial expenses of CLP0.5
billion.

Norgener

Norgener earnings decreased CLP2.5 billion, from CLP6.6 billion
for the quarter ended June 30, 2003 to CLP4.1 billion for the
quarter ended June 30, 2004. Operating income decreased 29%,
from CLP6.4 billion for the second quarter of 2003 to CLP4.6
billion for the second quarter of 2003. This variation is mainly
due to the 47% increase of the operating costs, due to higher
fuel consumption of CLP4.7 billion, compensated by lower energy
and capacity purchases of CLP1.5 billion. Additionally, earnings
raised from CLP14.3 billion to CLP15.4 billion from higher
energy sales to Escondida and others clients.

During the second quarter of 2004 as compared to the same period
of 2003, non-operating incomes decreased CLP0.7 billion related
to higher interest expenses as consequence of higher deferred
custom duty interest costs.

Energia Verde

Energia Verde registered earnings of CLP0.05 billion in the
quarter ended June 30, 2004, compared to CLP1.3 billion in the
same period of 2003. This variation is explained by a 54%
decrease of the operating income and a 65% decrease of the non-
operating results.

The variation of the operating income, from CLP1.2 billion to
CLP0.5 billion, is a consequence of higher energy purchase costs
of CLP0.7 billion and fuel consumption costs of CLP0.4 billion.
The operating costs increase was partially offset by higher
energy sales of CLP0.7 billion. Non-operating costs decreased
from an income of CLP0.4 billion in the second quarter of 2003
to a loss of CLP0.2 billon in the same period of 2004, primarily
due to exchange rate variation effect, which decreased CLP0.6
billion.

Gener Argentina

Gener Argentina consolidates the subsidiaries InterAndes, owner
of a transmission line between Chile and Argentina, and
TermoAndes, owner of a combined cycle plant in Argentina. As
well as Electrica Santiago the generation of this plant was
affected by the gas shortages in Argentina, however the impact
on the operating income was partially offset by a higher spot
market energy price.

Net loss for the second quarter of 2004 was CLP4.7 billion,
while for the same period of 2003 the net income reached CLP3.3
billion. This variation is mostly explained by the negative
variation of the non-operating losses. Operating income for the
quarter was CLP0.4 billion, as for the same quarter of the
previous year it reached CLP1.2 billion. Earnings decreased
CLP0.4 billion due to lower energy and capacity sales and
operating cost increased CLP0.2 billion attributable to higher
fuel cost.

Non-operating result decreased CLP9.7 billion due the negative
effect of CLP4.5 billion from the exchange rate variation and
CLP5.2 billion from higher interest expenses. This last event is
attributable to the extraordinary cost associate to early
termination of the interest rate swap agreement during the
refinancing process of the floating rate notes in April of 2004.

Chivor

The net income of our Colombian subsidiary, Chivor, decreased
from CLP8.7 billion for the second quarter of 2004 to CLP5.3
billion in the same period of 2004, due to a 14% decrease in the
operating income and a 7% decrease in the non-operating losses.

Earnings declined 21% from CLP21.3 billion to CLP16.9 billion
attributable to the decrease of CLP1.0 billion of the spot
market sales and CLP3.5 billion of the contracted sales. On the
other hand, operating costs reduced 29% due to the lower energy
purchases of CLP2.1 billion and lower reconciliation costs of
CLP0.9 billion. Non-operating costs declined CLP0.2 billion
explained by lower financial income of CLP0.5 billion and higher
negative exchange rate variation effect of CLP0.9 billion, which
were partially compensated by lower other non-operating expenses
of CLP1.1 billion.

Guacolda

Guacolda registered a net income decrease of CLP6.6 billion,
mainly attributable to the variation of the nonoperating
results. Operating income for the period ended June 30, 2004 was
CLP4.6 billion, 16% lower than the operating income of the
period ended June 30, 2003 of CLP5.5 billion. Earnings declined
4% from CLP17.8 billion to CLP17.1 billion, explained by lower
energy and capacity sales, while operating costs increased 0.1%
from CLP12.9 billion to CLP13 billion, due to lower energy an
capacity purchases.

Non-operating result declined from an income of CLP2.8 billion
in the second quarter of 2003 to a loss of CLP4.1 billion in the
second quarter of 2004. This variation is attributable to the
exchange rate variation, which recorded a loss of CLP1.3 billion
in this quarter while for the same period of 2003 it registered
an income of CLP5.6 billion.

Recent developments

- Escondida US$40 million upfront payment

On February 23, 2004, Norgener and its customer, Minera
Escondida Limitada, settled an arbitration regarding the
interpretation of two power supply agreements.

AES Gener and Escondida entered into several agreements that
include a decrease in price for both power supply contracts and
an upfront compensation payment by Escondida, the amendment and
extension of the two modified contracts until 2015, and the
execution of a new contract expiring in 2015. On July 6, 2004 we
received the total upfront compensation payment from Escondida
of US$40 million.

- Form F-4 filing and 7.5% Notes registration

According to the terms of the recently issued 7.5% Notes, due
March, 2004, the company filed on August 17, 2004 with the U.S.
Security Exchange Commission a form F-4 to register such notes.

- Energia Verde asset sale

Energia Verde received a notice from its client CMPC, in which
CMPC executed the option to buy all the installed facilities of
Nacimiento Plant in accordance with the Steam Contract Supply
Agreement ("Supply Agreement"). Energia Verde will be
compensated with a cash payment of approximately $16.6 million
and the plant will be transferred.

AES Gener S.A. is the second largest electricity generation
group in Chile in terms of operating revenue and generating
capacity with an installed capacity of 2,428 MW composed of
2,157 MW of thermal and 271 MW of hydro generating capacity. The
company is the first thermal generator in the Chile and serves
both the Central Interconnection System (SIC) and Northern
Interconnection System (SING). Through various subsidiaries and
related companies, AES Gener owns a dam based hydroelectric
plant in Colombia with a total nominal operating capacity of
1,000 MW; a combined-cycle natural gas-fired unit with 643 MW of
installed capacity in Argentina, connected to the SING by a 345
kV transmission line of 408 kms; a 25% interest in a
thermoelectric generation facility located in Dominican Republic
with approximately 586.5 MW of installed capacity; and a 13%
interest in a natural gas transportation company in Chile and
Argentina. AES Gener is 98.65% owned by The AES Corporation.

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


ENAMI: Mining Committee Schedules Another Voting on Bill
--------------------------------------------------------
Chile's senate mining committee will hold a meeting again this
week to vote on a bill to transfer the Ventanas smelter from
national mining company Enami to state copper corporation
Codelco.

Business News Americas reported that last week's voting came to
a tie. Committee members could not come to an agreement to
approve the government bill, which seeks to reduce Enami's debt.

The disagreement was over the government supposedly not living
up to its promise to stop making withdraws from Enami's profits
until completing the US$164 million in fiscal credit the state
has with the company.

Opposition mining committee senators Baldo Prokurica and Jaime
Orpis both alleged the government had not fulfilled its part of
the bargain.

If this week's voting comes to a tie once again, the bill's
principal article will be formally rejected.

The Chilean government had proposed the ownership transfer in
order to cut Enami's US$500 million debt, which had began to
cripple the Company's finances.

CONTACT:  ENAMI (Empresa Nacional de Mineria)
          MacIver 459,
          Santiago, Chile
          Phone: 637 52 78
                 637 50 00
          Fax:   637 54 52
          Email: webmaster@enami.cl
          Home Page: www.enami.cl/
          Contact:
          Jorge Rodriguez Grossi, President


SHELL CHILE: Repsol-YPF, Petrobras Eyeing Chilean Assets
--------------------------------------------------------
Repsol-YPF or Brazil's Petrobras could take over Shell Chile's
distribution properties once the assets are placed on the block,
says local daily Estrategia.

Shell is expected to sell its Chilean assets in a move to
consolidate investments in key countries such as Russia. The oil
giant recently disposed of properties in Peru and is scheduled
to sell its assets in Argentina.

Shell Chile is an attractive option for Petrobras and Repsol-YPF
since the Company's 21.6 percent share in the liquid-fuel
segment would solidify both companies' hold in the Southern
Cone.

A stronger presence for Petrobras or Repsol-YPF in Chile would
place them head-on with key player Enap. The sate-owned oil
company currently supplies the largest fuel distributors in the
country.

Enap, however, is confident of its position in the market saying
that it offers the best alternative for local distributors
price, quality and opportunity wise.



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

* COSTA RICA: IMF Wraps-up Article IV Consultation
--------------------------------------------------
On July 2, 2004, the Executive Board of the International
Monetary Fund (IMF) concluded the Article IV consultation with
Costa Rica.

Background:

Economic performance improved in 2003. Following several years
of slow growth, real GDP rose by 5 percent, boosted by a
recovery of exports and strong private investment. Inflation
declined below 10 percent, while unemployment fell to 6 percent.
The external current account deficit narrowed to 5.3 percent of
GDP in 2003 from 5.7 percent of GDP in 2002. Strong export
growth, particularly electronics, largely offset higher imports
of oil and capital goods. Gross reserves rose to 2 months of
imports, owing to pre-financing of 2004 fiscal needs and short-
term capital inflows.

The public sector deficit was reduced to 5.2 percent of GDP in
2003 from 5.7 percent in 2002, owing to temporary tax measures
and expenditure restraint. The primary balance shifted to a
surplus of 0.3 percent of GDP, from a deficit of percent of
GDP in 2002. However, the public debt continued to rise,
reaching 55 percent of GDP by the end of the year.

Monetary policy continued to be heavily constrained by the large
quasi-fiscal deficit of the central bank. Broad money rose by
13.6 percent in 2003, reflecting large inflows of private
capital, and credit to the private sector increased by about 20
percent in nominal terms. Financial dollarization continued to
deepen and, by end-2003, about 60 percent of private sector
credit was denominated in foreign currency. Some progress was
made in implementing the banking reform recommendations of the
2001 Financial Sector Assessment Program (FSAP), but many
reforms remain pending, including to level the playing field
between onshore and offshore, as well as public and private
banks.

Real GDP is expected to expand by 4 percent in 2004, and while
inflation has risen to 11 percent recently owing to higher oil
prices, core inflation remains stable at around 10 percent,
broadly in line with the rate of crawl. The fiscal deficit is
projected to remain at about 5.3 percent of GDP in 2004, as a
comprehensive tax reform currently before Congress is expected
to compensate for the temporary revenue measures that expired at
end-2003. The successful conclusion in early 2004 of
negotiations for a trade agreement with the United States
(CAFTA) will make permanent the preferential access to the U.S.
market hitherto granted under the Caribbean Basin Initiative.

Executive Board Assessment

Executive Directors welcomed the improvement in Costa Rica's
economic situation since the last Article IV consultation, and
commended the country's long-standing democratic tradition,
solid institutions, and strong record of social development.
They noted the favorable medium-term outlook, which should
provide a good environment to make rapid progress on structural
reforms. At the same time, Directors observed that significant
vulnerabilities remain. Fiscal and external current account
deficits continue to be large, the public debt has risen to 55
percent of GDP, the banking system suffers from growing
dollarization and other weaknesses, and international reserves
should be strengthened given the currency peg and the banking
system's dollar liabilities.

Against this background, Directors endorsed several important
reforms launched by the authorities, including a tax reform and
trade agreements with the United States and CARICOM, and they
were encouraged by the broad-based political support that these
reforms are receiving. However, Directors called for a more
comprehensive agenda of well-sequenced reforms to address
remaining vulnerabilities, with special focus on tax
administration, government spending, state enterprises, monetary
management, and the prudential regulation and supervision of the
financial sector. In light of the consensus-based character of
the political system in Costa Rica, Directors emphasized that
greater attention should be directed toward building the
necessary political support for the reform agenda.

Directors stressed that strengthening the fiscal position is
crucial for medium-term fiscal sustainability. They supported
the authorities' efforts to obtain prompt legislative approval
of the proposed tax reform, and stressed the need to underpin
this reform with measures to strengthen tax administration.
Directors also urged expenditure reform as a key priority, in
particular by rolling back tax revenue earmarking, strengthening
the finances of the pension system, keeping the wage bill under
control, and improving the performance of the public
enterprises.

Directors welcomed the authorities' plans to strengthen debt
management, and agreed that fiscal consolidation would make an
important contribution in this regard. They supported efforts to
lengthen debt maturities and to develop the market for colon
instruments in order to reduce the need for foreign-currency
instruments.

Directors endorsed the authorities' intention to focus monetary
policy on the objective of reducing inflation, and encouraged
them to create the conditions for an eventual shift toward
inflation targeting. They welcomed the authorities' plans to
strengthen monetary management and instruments, make monetary
policy more forward looking, and strengthen the analysis of
monetary transmission channels. Directors also supported the
planned recapitalization of the central bank. They noted that
shifting the central bank's quasi-fiscal deficit to the
government will improve fiscal transparency, as well as
strengthen monetary policy and efforts to reduce inflation,
provided that overall public borrowing declines. Some Directors
considered that greater exchange rate flexibility could help
reduce the economy's vulnerability to external shocks and
facilitate adjustment to structural change. Directors noted that
a move toward more flexibility should be well sequenced and
supported by fiscal and financial reforms, and by the
development of exchange market infrastructure.

Directors urged further progress toward strengthening the
financial sector. They welcomed the steps taken so far to
implement the recommendations of the 2001 Financial Sector
Assessment Program (FSAP) report and follow-up technical
assistance missions. However, Directors stressed that additional
efforts are needed to strengthen the prudential and supervisory
system. In particular, they stressed the need to ensure equal
treatment of public and private banks and of offshore and
onshore banks, implement consolidated supervision, strengthen
sanctions and the bank resolution framework, and upgrade
liquidity and risk management. They recommended the
centralization of credit risk data for banks. The authorities
also need to make sure that the investment funds market operates
in accordance with relevant norms and transparency standards.
Directors noted the authorities' efforts to further improve the
already strong framework for combating money laundering and
terrorism financing in a regional context.

Directors considered the rising trend of dollarization to be a
significant vulnerability. They agreed that, to halt and reverse
this trend, a broad strategy centered on reinforcing confidence
in the colon and the onshore banking system as well as ensuring
that the risks of dollar intermediation are fully internalized
would be required.

Directors welcomed the progress made by Costa Rica in opening
new markets for its exports. They commended the successful
completion of negotiations on the Central American Free Trade
Agreement with the United States, and supported the authorities'
efforts to secure its early congressional approval. Directors
pointed to the positive impact this agreement would have on
export growth, foreign direct investment, and economic growth,
and urged early approval of the associated structural reforms.

To view economic indicators:
http://bankrupt.com/misc/CostaRica_2Q04.htm

CONTACTS: International Monetary Fund
          External Relations Department
          700 19th Street, NW
          Washington, D.C. 20431 USA

          Public Affairs
          Phone: 202-623-7300
          Fax: 202-623-6278

          Media Relations
          Phone: 202-623-7100
          Fax: 202-623-6772



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

CDEE/EDENORTE/EDESUR: To Face EGE Haina in Court
------------------------------------------------
Dominican Republic's state power company CDEEE and state-owned
power distributors Edenorte and Edesur found themselves
defendants in a lawsuit brought by local generator EGE Haina.

Business News Americas reports that Haina filed a claim against
the three utilities for a total of DOP519 million (US$13.3
million). The move came after Haina discovered that the three
companies had privately signed agreements in July with four
generators (CEPP, Consorcio Laesa, Metaldom, Seaboard) and an
electrical material supply company (Elecnor) to make payments of
DOP3 billion a month for a period of two years. That sum will be
distributed between the five companies.

"They have promised a portion of payment to those five companies
without giving explanations why, and they are leaving the other
suppliers marginalized," Business News Americas quoted Haina
spokesperson Marta Fernandez as saying.

There were 15 or so generators not included in the agreement.

Fernandez revealed that Haina received a third of May's payment
from the state companies at the beginning of this month.


TRICOM: Reports Improved Second Quarter 2004 Results
----------------------------------------------------
Tricom, S.A. (OTC Bulletin Board: TRICY - News) announced
Thursday consolidated unaudited financial results for the second
quarter and first six months of 2004.

Results of Continuing Operations

Continuing operations consist of the Company's local service,
long distance, mobile, cable television and broadband data
transmission and Internet services in the Dominican Republic, as
well as the Company's wholesale and retail international long
distance operations in the U.S. The Company's financial results
continue to be significantly affected by currency devaluation.
The average value of the Dominican peso with respect to the U.S.
dollar declined by approximately 70.5 percent during the 2004
second quarter compared to the average value during the 2003
second quarter, and decreased by 85.3 percent during the first
half of 2004 compared to the first half of 2003. The Dominican
economy also was affected adversely by inflation, which reached
approximately 31.1 percent during the first six months of 2004
and approximately 60.4 percent over the previous 12 months
ending June 30, 2004.

Notwithstanding the effects of currency devaluation and the
declining Dominican economy, second quarter operating results
for the Company's domestic telephony, mobile, cable and data and
Internet business segments improved sequentially from results in
the 2004 first quarter.

"During the second quarter we achieved significant progress in
our domestic core businesses, delivering strong subscriber
growth", Carl Carlson, Chief Executive Officer. "We focused our
efforts on improving customer retention, optimizing our capital
expenditures and strengthening liquidity. We are pleased with
the progress we achieved in all those fronts. For the rest of
the year we will remain intensely focused on expense control and
cash preservation, maintaining a rigorous financial discipline
with respect to operational decisions, spending capital in the
right places, and continuing to support our growth drivers",
added Carlson.

Operating revenues from continuing operations totaled $43.0
million for the 2004 second quarter, a 14.3 percent decrease
from the 2003 second quarter. On a sequential basis, operating
revenues increased by 4.1 percent. For the first six months of
2004, operating revenues from continuing operations totaled
$84.3 million, a 19.3 percent decrease from the same period in
2003.

Long distance revenues decreased by 21.0 percent to $17.9
million during the 2004 second quarter, and by 18.5 percent to
$37.4 million during the first six months, primarily due to
lower international long distance traffic derived from the
Company's U.S.-based wholesale and retail operations, coupled
with lower average termination rates to the Dominican Republic
during the first six months of the year. The growth of long
distance revenues was also impacted by the effects of currency
devaluation on outbound international and domestic long distance
revenues generated by the Company's retail call centers and
prepaid cards, offset in part by higher prepaid cards sales and
minutes. Prepaid cards sold within the Dominican Republic
totaled 7.0 million during the first six months of the year,
representing a 35 percent year-over-year increase. Prepaid card
minutes increased by 59.2 percent to 21.9 million minutes during
the first six months of 2004.

Domestic telephony revenues totaled $13.8 million in the 2004
second quarter, a 12.2 percent decrease from the 2003 second
quarter. On a sequential basis, domestic telephony revenues
increased by 17.3 percent during the 2004 second quarter. For
the first six months, domestic telephony revenues decreased 22.0
percent to $25.5 million. The decrease, principally due to
currency devaluation impacting the conversion of peso-
denominated domestic telephony revenues into U.S. dollars, was
offset by a higher average number of lines in service during the
first six months of the year. At June 30, 2004, the Company had
approximately 151,000 lines in service, an 8.3 percent increase
from lines in service at June 30, 2003. New line sales totaled
approximately 23,000 during the first six months of 2004
compared to 14,000 during the first six months of 2003. Net line
additions totaled approximately 6,200 during the first six
months of 2004 compared to a decrease of approximately 11,000
during the year-ago period.

Mobile revenues decreased by 4.5 percent to $7.1 million in the
2004 second quarter, and by 15.4 percent to $13.5 million for
the first six months of 2004, primarily due to the devaluation
of the Dominican peso. Second quarter mobile revenues increased
by 12.6 percent with respect to mobile revenues during the 2004
first quarter. Mobile subscribers totaled approximately 313,000
at June 30, 2004, a 26.4 percent decrease from mobile
subscribers at June 30, 2003. Second quarter mobile subscribers
increased by 13.1 percent with respect to mobile subscribers at
the end of the 2004 first quarter. The year-over-year decrease
in mobile subscribers is the result of Company-initiated
disconnections of approximately 201,000 "incoming-call" only
mobile subscribers during the 2004 first quarter. Excluding the
disconnections of "incoming-call" only subscribers, the Company
added approximately 145,000 gross and 80,000 net mobile
subscribers during the first half of 2004. Despite a lower
average mobile subscriber base, total minutes of usage increased
17.4 percent to 145.1 million minutes during the first half of
2004 compared to total minutes of usage during the first half of
2003.

Cable revenues decreased by 14.2 percent to $3.1 million for the
2004 second quarter, and by 24.9 percent to $5.7 million for the
first six months of 2004, primarily as a result of currency
devaluation, coupled with a lower average cable subscriber base
during the first half of the year. On a sequential basis, cable
revenues increased by 17.5 percent during the 2004 second
quarter. At June 30, 2004, cable subscribers totaled
approximately 58,000, a 10.5 percent decrease from cable
subscribers at June 30, 2003. The decline in cable subscribers
is primarily attributable to a weak economic environment. In an
effort to reduce churn and increase customer satisfaction, the
Company instituted a number of customer care and retention
programs during the first half of 2004. The Company's average
monthly churn rate for cable television services declined to 2.1
and 2.2 percent during the 2004 second quarter and first six
months of 2004, respectively, compared to 4.5 percent and 4.8
during the 2003 second quarter and first six months of 2003,
respectively.

Data and Internet revenues increased 43.8 percent to $1.1
million in the 2004 second quarter. For the first six months,
data and Internet revenues decreased 3.4 percent to $2.3
million. The decrease in data and Internet revenues resulted
primarily from currency devaluation, partially offset by a year-
over-year increase in data and Internet subscribers. At June 30,
2004, data and Internet access accounts totaled approximately
15,000, representing a 32.9 percent increase from data and
Internet subscribers at June 30, 2003.

Consolidated operating costs and expenses from continuing
operations declined by 6.2 percent to $50.7 million in the 2004
second quarter, and by 12.8 percent to $96.9 million during the
first half of the year. The decline in operating costs and
expenses were primarily the result of a decrease in depreciation
and amortization charges, as well as lower selling, general and
administrative (SG&A) expenses. These decreases were offset in
part by costs related to the Company's financial restructuring
efforts totaling $2.6 million during the 2004 second quarter and
$4.6 million during the first six months of the year.

Cost of sales and services decreased by 2.0 percent to $22.1
million during the 2004 second quarter, and by 3.5 percent to
$43.1 million during the first six months of the year, primarily
due to lower installation costs and cable programming fees,
offset by higher transport and access charges as a result of
higher domestic interconnection rates. SG&A expenses declined by
12.9 percent to $11.6 million in the 2004 second quarter and by
23.5 percent to $22.4 million during the first six months of
2004. The decline in SG&A expenses is primarily due to
continuing expense reduction efforts and operating efficiencies,
as well as lower Dominican peso-denominated expenses resulting
from currency devaluation. Depreciation and amortization
expenses totaled $14.3 million during the 2004 second quarter
and $26.7 million during the first six months of 2004, a
decrease of 20.9 percent and 28.0 percent, respectively, from
the year-ago periods. The decrease in depreciation and
amortization expenses primarily resulted from a lower
depreciable asset base.

Interest expense totaled approximately $14.0 million during the
2004 second quarter and $29.4 million during the first six
months of 2004, compared to $16.3 million and $31.8 million
respectively in the year-ago periods. The Company suspended
principal and interest payments on its unsecured debt
obligations and principal payments on its secured indebtedness
beginning in October 2003. The Company recorded $463,000 in
foreign currency exchange gain during the 2004 second quarter
and $1.9 million for the first six months of 2004.

In 2003, the Company recognized $2.1 million during the second
quarter and $3.9 million during the first six months in losses
from discontinued operations in Central America. The Company
will continue to report losses from discontinued operations in
the periods they occur. Net loss totaled $21.2 million, or $0.33
per share for the 2004 second quarter, compared to a net loss of
$21.8 million, or $0.34 per share during 2003 second quarter.
Net loss for the first six months of 2004 totaled $40.1 million,
or $0.62 per share compared to a net loss of $41.4 million, or
$0.64 per share during the year-ago period.

Liquidity and Capital Resources

In light of current conditions in its principal market, the
Dominican Republic, ongoing funding needs and its inability to
service its debt, the Company has taken steps to conserve cash
and focus it efforts and resources on its core businesses,
including the suspension of interest payments on unsecured
indebtedness and principal payments on secured indebtedness, the
appointment of a Chief Restructuring Officer, the reduction of
SG&A expenses and capital expenditures, and the sale of its
Central American trunking assets. The estimated net proceeds of
the sale received by the Company, totaling approximately $9
million, will be used to fund the Company's short- term working
capital requirements. The Company continues to evaluate
potential divestments of other under-performing or non-strategic
assets.

Total debt, including capital leases and commercial paper,
amounted to $447.3 million at June 30, 2004, compared to $449.3
million at December 31, 2003. Total debt included $200 million
principal amount of 11-3/8 percent Senior Notes due in September
2004, approximately $34.5 million of secured debt and
approximately $212.8 million of unsecured bank and other debt.

At June 30, 2004, the Company had approximately $11.1 million of
cash on hand. For the six-months ended June 30, 2004 the
Company's net cash provided by operating activities totaled
approximately $11.9 million. Capital expenditures totaled $1.6
million during the 2004 second quarter and $2.3 million during
the first six months of 2004, representing decreases of 65.1
percent and 73.1 percent, respectively, from the same periods
last year.

Financial Restructuring Update

As a consequence of the continuing devaluation and volatility of
the Dominican peso and lower net cash flows being generated by
its operations in the Dominican Republic, the Company suspended
principal and interest payments on its unsecured indebtedness
and principal payments on its secured indebtedness in October
2003. As a result, the Company has defaulted with respect to its
outstanding indebtedness.

As previously announced, the Company has engaged in discussions
with holders of its indebtedness, including an ad hoc committee
of holders of its 11-3/8 percent Senior Notes due 2004,
regarding a consensual financial restructuring of its balance
sheet. Although there is no assurance that any agreement will
occur, the Company is optimistic that these negotiations will
lead to a consensual restructuring in the near term. The
Company's future results and its ability to continue operations
will depend on the successful conclusion of the restructuring of
its indebtedness.

Since these negotiations are ongoing, the treatment of the
Company's existing secured and unsecured lenders, as well as the
interest of its existing shareholders, is uncertain at this
time. Accordingly, investors in the Company's debt and equity
securities may be substantially diluted or may lose all or a
substantial portion of their investment in the Company's
securities.

About TRICOM

Tricom, S.A. is a full service communications services provider
in the Dominican Republic. It offers local, long distance,
mobile, cable television and broadband data transmission and
Internet services. Through Tricom USA, it is one of the few
Latin American based long-distance carriers that is licensed by
the U.S. Federal Communications Commission to own and operate
switching facilities in the United States. Through its
subsidiary, TCN Dominicana, S.A., it is the largest cable
television operator in the Dominican Republic based on number of
subscribers and homes passed.

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

CONTACT:  Miguel Guerrero, Investor Relations
          Tel: (809) 476-4044 / 4012
          E-mail: investor.relations@Tricom.net


* DOMINICAN REPUBLIC: IMF Assures Support for New Government
------------------------------------------------------------
Mr. Jose Fajgenbaum, Acting Director of the IMF's Western
Hemisphere Department, welcomed last Thursday the policy
commitments outlined by Dr. Leonel Fernandez on the occasion of
his inauguration as the President of the Dominican Republic:

"The IMF is ready to work closely with the new economic team
that took office this week. In fact, important and constructive
technical collaboration between the team and IMF staff has been
going on for some time already, and will continue.

"I had the privilege of meeting President Fernandez earlier this
year, and I know that he clearly understands the economic policy
challenges facing his country. I believe President Fernandez is
determined to move ahead with institutional reforms and economic
policies that will bring confidence, stability, and sustained
economic growth back to the Dominican Republic. This was well
reflected in the President's inaugural address this week. The
fiscal measures he announced, complementing the tax reform now
in congress, would provide much-needed resources to the
government, helping to stabilize the public debt and allowing
the government to protect critical social and investment
expenditures. Reforms in other areas, including the banking and
electricity sectors, and steps to improve governance, will be
equally important. We look forward to holding further
discussions with the new economic team shortly," said Mr.
Fajgenbaum.

CONTACTS: International Monetary Fund
          External Relations Department
          Public Affairs
          Phone: 202-623-7300
          Fax: 202-623-6278

          Media Relations
          Phone: 202-623-7100
          Fax: 202-623-6772



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

GALEY & LORD: Files Voluntary Bankruptcy Petition
-------------------------------------------------
Seeking to move forward with its efforts to be acquired, Galey &
Lord, a leading global supplier of denim, khaki and corduroy
fabrics for the fashion apparel and uniform markets, filed
Thursday a voluntary Chapter 11 petition in the U.S. Bankruptcy
Court for the Northern District of Georgia. The company
announced that it has entered into a definitive asset purchase
agreement with Patriarch Partners, LLC, whose funds have $4
billion under management, to acquire the company pursuant to
section 363 of the U.S. Bankruptcy Code. The agreement amends
the proposal Patriarch made last month, the terms of which were
not disclosed.

Galey & Lord also announced it has secured an $80 million post-
petition financing agreement with GE Capital, which will enable
the company to continue normal business operations, including
providing wages and benefits to employees, maintaining bank
accounts and cash management systems, and meeting new
obligations to customers, suppliers and others. The company is
seeking expedited Bankruptcy Court approval of the financing
agreement.

Under the terms of the Patriarch agreement, which is subject to
Bankruptcy Court approval and other acquisition offers, if any,
Patriarch would pay $45 million for the company's term debt and
pay off, replace or assume up to $85 million in other secured
debt plus the outstanding letters of credit. Patriarch also
would assume up to $58 million in trade, utility, tax, and
employee pay and benefit obligations. The agreement excludes
certain legacy liabilities such as those obligations insured by
the federal Pension Benefit Guarantee Corporation. The
transaction is expected to close by early November 2004.

In July, Galey & Lord's board agreed to an out-of-court
acquisition offer by Patriarch. The proposal did not win the
unanimous approval of the term lenders required for the
acquisition to go forward.

"Our board of directors and many of our lenders have concluded
that an acquisition by Patriarch presents the greatest
opportunity to secure a bright future for Galey & Lord and is in
the best interests of our customers, employees, vendors,
suppliers and stakeholders," said John J. Heldrich, president &
CEO of Galey & Lord. "While we are disappointed that our lenders
were unable to reach unanimous agreement to proceed with the
original plan, we are confident that this course will allow us
to continue on a positive track and give us the means of
achieving our long-term goals.

"As this process unfolds, we will continue to work to preserve
jobs, protect value and provide the highest level of service to
our customers," he added. "We expect business to continue as
usual, with little, if any, impact on our employees, partners or
business operations. Patriarch believes in these same
responsible business practices.

"In modifying its proposal for bankruptcy court consideration,
Patriarch has reiterated its commitment to working with
management to help this company achieve stability and provide
the resources necessary for us to achieve long-term success," he
continued. "Patriarch is a highly-regarded investor with a long
track record of working with companies in our industry. We are
grateful for its staunch support and are committed to an open,
fair and expedited sale process that benefits all of our
stakeholders."

The company has retained Dechert LLP and Alston & Bird as
bankruptcy counsel and Houlihan Lokey Howard & Zukin as
investment banking advisors.

Galey & Lord, Inc., which is privately held following its
emergence from bankruptcy protection in March of 2004, operates
domestically and in Canada under two divisions, Swift Denim and
Galey & Lord Apparel, and internationally through joint ventures
in Europe, North Africa, Asia and Mexico. Its customers include:
VF, Gap, Old Navy, Banana Republic, Polo Ralph Lauren,
Abercrombie & Fitch, Levi's, Tommy Hilfiger, L.L. Bean, Nautica,
Eddie Bauer, Liz Claiborne, Haggar, Land's End, and Tropical
Sportswear / Savane, among others.

Galey & Lord Apparel is a leading producer of innovative woven
sportswear fabrics as a result of its expertise in sophisticated
fabric finishing and close design partnerships with its
customers. Swift Denim is a leading producer of differentiated
and value-added denim products supplying top designers and
retailers around the world. Galey & Lord and its joint venture
interests operate in the U.S., Canada, Mexico, Asia, Europe and
North Africa.


ISSSTE: Close to Belly-Up
-------------------------
Mexico's Social Security and Services Institute for State
Workers (ISSSTE) is about to collapse, warned Benjamin Gonzalez
Roaro, ISSSTE director general.

"The ISSSTE is collapsing and we have to recognize that because
it is affecting public finances and causing problems in other
priority areas of Mexican society, such as the fight against
poverty, education, infrastructure and health," El Economista
quoted the official as saying when he appeared before the
Permanent Commission of Congress.

The number of pensioners receiving benefits has increased by
500% but the number of contributors has only risen by 50%. The
Office of the Supreme Auditor of the Federation (ASF) has
recommended carrying out a reform of the pension system,
focusing it on the system of individual accounts of the private
pension funds (Afores), said Gonzalez Roaro.


VOLKSWAGEN: Pay Dispute Shuts Down Puebla Plant
-----------------------------------------------
Union workers from Volkswagen's Puebla Plant snubbed the 4.45
percent pay increase offered by management on Wednesday and
walked out en masse hoping to secure a better bargain from the
Company.

Reuters says that the union had been demanding an 8.5 wage
increase for its members before negotiations collapsed. About 60
percent of union members rejected the Company's proposal that
could have raise overall workers' package by 5.4 percent.

However, union chief Jose Luis had earlier hinted that the
union's demands remains open for negotiation. He said that a
continued shutdown would not benefit either parties involved.

Volkswagen's management and union representatives returned to
the negotiation table late Wednesday to attempt a compromise and
end the strike.

Decline in export demand, especially in the United States, has
cut the plant's production to just four days a week. Volkswagen
ranks third among Mexico's auto exporters, next to General
Motors and DaimlerChrysler.



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

NWRHA: Board Frustrates JSC
---------------------------
A Joint Select Committee (JSC) of Parliament criticized the
board of the North West Regional Health Authority (NWRHA) for
failing to answer several questions raised by the JSC members in
a meeting held Tuesday.

The meeting, which was chaired by the JSC, was set up to look
into the operations of the NWRHA after the authority failed to
submit to the Board of Inland Revenue more than $106 million in
income taxes (PAYE) and health surcharge deducted from
employees.

When asked by JSC Chairperson Mary King about the time NWRHA
doctors spent at hospitals versus their private practice, NWRHA
Chairman Hugh Eastman answered: "I am not sure we can
effectively answer that question." This response was repeated
many times during the almost three-hour long session in the
Parliament Chamber.

During questioning, Eastman said he found out that some doctors
had their private practice housed at hospitals, but had been
unable to verify this and could not say how much the NWRHA
benefited from this situation.

But if this was happening, the NWRHA was getting "very little,"
Eastman added.

One of the major problems at the NWRHA, Eastman identified, is
the lack of senior managers. Managers who have been appointed
such as the CEO, the vice-president finance, the vice-president
human resource have all been filled by "acting" personnel.
Eastman said this process, which has been in place for the past
two years, has resulted in numerous problems.

Referring to the resignation of the acting CEO and the senior
vice-president of corporate services, Eastman said the NWRHA
suffers from "depleted management" which was why the board could
not deal "in depth" with reports given.

He added that senior managers did not have enough "experience"
to affirm the position.

Eastman described the NWRHA as a large, complex organization,
which required skilled experience that has been lacking over the
last two years. He said the board was hoping to get an
"enhanced" package from the Ministry of Health to find a
suitable person to fill the position of CEO.



                            ***********


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

Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
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Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and
Lucilo Junior M. Pinili, Editors.

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

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