TCRLA_Public/040826.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

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

             Thursday, August 26, 2004, Vol. 5, Issue 169

                            Headlines

A R G E N T I N A

ASTILLEROS RIO BRAVO: Reports Submission Set
AUTOPISTAS DEL SOL: S&P Issues `argB+' Ratings to Several Bonds
CUIDAR SALUD: Debt Payments Halted, Set To Reorganize
DISGAL S.A.: Court Orders Liquidation
FABRIBOLS S.R.L.: Court Favors Creditor's Bankruptcy Call

HALL STARTS: Gets Court OK for Reorganization
HERMAR S.R.L.: Court OKs Creditor's Bankruptcy Request
LABORATORIO LISTER: Begins Liquidation Proceedings
LERWAI S.R.L.: Asks to Restructure Debt
LICARI S.A.: Local Court OKs "Concurso Preventivo" Motion

LYNX S.R.L.: Liquidating Assets to Pay Debts
MADERIN S.A.: Initiates Bankruptcy Proceedings
MERCADO DE MATERIALES: Enters Bankruptcy on Court Orders
MOLINOS RIO: Yet to Decide on Poo Acquisition
ROLDAN Y CIA: Court Rules In Favor of Liquidation

SKM S.A.: Court Approves Creditor's Bankruptcy Motion
SOLSER S.R.L.: Gears for Reorganization
SUERTE S.A.: Court Declares Company Bankrupt
TELECOM ARGENTINA: 94.4% of Creditors Accept Debt Offer
TRANSENER: Makes ARS8.7Mln Payment to Financiera Ludicor


B E R M U D A

LORAL SPACE: Analyst Predicts Bright Prospect


B R A Z I L

BANCO VOTORANTIM: S&P Rates Notes B+
CEMIG: Deloitte Touche Tohmatsu Presents Audit Report
SKY BRASIL: S&P Upgrades Issuer Credit Rating To B-
VARIG: Gains Case Support From Second Justice
* S&P Affirms Ratings, Foreign Currency Outlook On Brazil

* BRAZIL: Gets $505M World Bank Loan for Environmental Projects



C O L O M B I A

AVIANCA: Restructuring Plan Obtains US Judge's Approval
* Colombia: Not Seeking to Extend IMF Loan Agreement



D O M I N I C A N   R E P U B L I C

AES-ANDRES: Hounds Government for $23Mln Debt


J A M A I C A

C&WJ: President Moves to London to Take on Senior Position


P E R U

ROYAL SHELL: Bay Named Exploration Director for EP Americas


T R I N I D A D   &   T O B A G O

BWIA: Cuts Losses to $6.5M in 1H04


V E N E Z U E L A

BANCO DE DESARROLLO: Group Holding Venezuelan Government Liable
PDVSA: Completes Construction of Jose Terminal Dock

     -  -  -  -  -  -  -  -

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

ASTILLEROS RIO BRAVO: Reports Submission Set
--------------------------------------------
Mr. Santiago Manuel Quiben, the trustee assigned to supervise
the liquidation of Astilleros Rio Bravo S.A., will verify
creditors' proofs of claims until September 23, 2004.

After the verification period, the trustee will then submit
validated individual claims for court approval on November 5,
2004. These reports explain the basis for the accepted and
rejected claims. He will also submit a general report on
December 20, 2004.

Infobae reports that Court No. 3, assisted by Clerk No. 6, has
jurisdiction over this bankruptcy case.

CONTACT: Astilleros Rio Bravo S.A.
         Pasteur 117
         Buenos Aires

         Mr. Santiago Manuel Quiben, Trustee
         Esmeralda 783
         Buenos Aires


AUTOPISTAS DEL SOL: S&P Issues `argB+' Ratings to Several Bonds
---------------------------------------------------------------
Standard & Poor's International Ratings, Ltd. Sucursal Argentina
assigned a `argB+' rating to the following corporate bonds
issued by Autopistas del Sol S.A.:

- US$112,334,466 worth of bonds described as "Obligaciones Neg.
con descuento con cotizaci˘n a 5 a¤os de vencimiento, monto
original" with undated maturity.

- US$49,306,639 worth of bonds described as "Obligaciones Neg.
con descuento sin cotizaci˘n a 5 a¤os de vencimiento, monto
original" with undated maturity.

-  US$215,225,419 worth of bonds described as "ONS a tasa de
inter‚s escalonada creciente a 10 a¤os de vencimiento, monto
original" with undated maturity.

The ratings, posted by securities regulator Comision Nacional de
Valores(CNV) in its web site, were based on the Company's
financial standing as of June 30, 2004.

S&P explains that bonds with `argB+' ratings face exposure to
adverse business or economic conditions that could lead to an
issuer's inadequate capacity to meet its obligations.


CUIDAR SALUD: Debt Payments Halted, Set To Reorganize
-----------------------------------------------------
Judge Ottolenghi of Buenos Aires' Civil and Commercial Tribunal
Court No. 4 is reviewing the merits of the reorganization
petition filed by Cuidar Salud S.A.

La Nacion recalls that the health service provider filed the
petition following cessation of debt payments since May 28,
2004. Reorganization will allow the company to avoid bankruptcy
by negotiating a settlement with its creditors.

Dr. Juarez, Clerk No. 7, assists the court on this case.

CONTACT: Cuidar Salud S.A.
         Avenida Santa Fe 1971
         Buenos Aires


DISGAL S.A.: Court Orders Liquidation
-------------------------------------
Disgal S.A., a company operating in Buenos Aires, prepares to
wind-up its operations following the bankruptcy pronouncement
issued by Court No. 13 of the city's 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 appointed Mr. Omar Sergio Vazquez
as trustee. He will be reviewing creditors' proofs of claims
until October 1, 2004.

Clerk No. 25 assists the court on this case, which will end with
the disposal of the company's assets to cover its liabilities.

CONTACT: Mr. Omar Sergio Vazquez, Trustee
         Avda Santa Fe 1127
         Buenos Aires


FABRIBOLS S.R.L.: Court Favors Creditor's Bankruptcy Call
---------------------------------------------------------
Papelera Orlando S.R.L. successfully sought for the bankruptcy
of Fabribols S.R.L. after Judge Favier Dubois of Buenos Aires'
Civil and Commercial Tribunal Court No. 9 declared the Company
"Quiebra," reports La Nacion.

As such, the Company will now start the bankruptcy process with
Ms. Marcela Folco as trustee. Creditors of the Company must
submit their proofs of claim to the trustee before October 15,
2004 for authentication. Failure to do so will mean a
disqualification from the payments that will be made after the
Company's assets are liquidated.

Dr. Taricco Vera, Clerk No. 18, assists the court on the case,
which will culminate in the liquidation of all of its assets.

CONTACT: Fabribols S.R.L.
         Carlos Calvo 2654
         Buenos Aires

         Ms. Marcela Folco, Trustee
         Rivadavia 1044
         Buenos Aires


HALL STARTS: Gets Court OK for Reorganization
---------------------------------------------
Hall Starts S.A. will begin reorganization following the
approval of its petition by Court No. 4 of Buenos Aires' Civil
and Commercial Tribunal. The opening of the reorganization will
allow the company to negotiate a settlement with its creditors
in order to avoid a straight liquidation.

Mr. Oscar Alfredo Arias will oversee the reorganization
proceedings as the court-appointed Trustee. He will verify
creditors' claims until November 9, 2004. Next, the validated
claims will be presented in court as individual reports on
December 22, 2004.

The trustee is also required by the court to submit a general
report essentially auditing the company's accounting and
business records as well as summarizing important events
pertaining to the reorganization. This report will be presented
in court on March 7, 2005.

The Informative Assembly, the final stage of a reorganization
where the settlement proposal is presented to the company's
creditors for approval, is scheduled on September 6, 2005.

CONTACT: Mr. Oscar Alfredo Arias, Trustee
         Carlos Pellegrini 1063
         Buenos Aires


HERMAR S.R.L.: Court OKs Creditor's Bankruptcy Request
------------------------------------------------------
Hermar S.R.L. entered bankruptcy after Judge Paez Castaneda of
Buenos Aires' Civil and Commercial Tribunal Court No. 21
approved a bankruptcy motion filed by Mr. Marcelo Frutos,
reports La Nacion. The Company's failure to pay US$64,427.14 in
debt prompted the liquidation plea.

Working with Dr. Barreiro, Clerk No. 42, the court assigned Mr.
Jose Salem Ini as trustee for the bankruptcy process. The
trustee's duties include the authentication of the Company's
debts and the preparation of the individual and general reports.
Creditors are required to present their proofs of claims to the
trustee before November 26, 2004.

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

CONTACT: Hermar S.R.L.
         Gaboto 867
         Buenos Aires

         Mr. Jose Salem Ini, Trustee
         Teniente General Juan Domingo Peron 1730
         Buenos Aires


LABORATORIO LISTER: Begins Liquidation Proceedings
--------------------------------------------------
Laboratorio Lister S.R.L. of Cordoba will begin liquidating its
assets after Court No. 1 of the city's Civil and Commercial
Tribunal declared the company bankrupt, says Infobae.

No trustee has been assigned to the case although the court has
set the verification of claims to end on August 27, 2004.
Individual reports are scheduled for court submission on
September 29, 2004 followed by the general report on November
22, 2004.

CONTACT: Laboratorio Lister S.R.L.
         Emilio Castelar 380 (BA§ Alta)
         Cordoba


LERWAI S.R.L.: Asks to Restructure Debt
---------------------------------------
Lerwai S.R.L., a company operating in Buenos Aires, requested
permission to reorganize after failing to pay its liabilities.

The reorganization petition, once approved by the court, will
allow the company to negotiate a settlement with its creditors
in order to avoid a straight liquidation.

The case is pending before Court No. 2 of the city's Civil and
Commercial Tribunal. Clerk No. 4, assists the court on this
case.

CONTACT: Lerwai S.R.L.
         Avda Callao 322
         Buenos Aires


LICARI S.A.: Local Court OKs "Concurso Preventivo" Motion
---------------------------------------------------------
Court No. 2 of Bell Ville's Civil and Commercial Tribunal
approved the reorganization petition filed by Licari S.A.,
reports Infobae. The court, assisted by Clerk No. 3, appointed
Mr. Hector L.V. Cornaglia as Trustee.

Important dates, such as the deadline for the submission of the
necessary reports, as well as the schedule for the informative
assembly will be announced shortly.

CONTACT: Mr. Hector L.V. Cornaglia, Trustee
         Cordoba 649 Bell Ville
        (Cordoba)


LYNX S.R.L.: Liquidating Assets to Pay Debts
--------------------------------------------
Buenos Aires-based Lynx S.R.L. will begin liquidating its assets
following the pronouncement of the city's Court No. 11 that the
company is bankrupt, Infobae reports.

The bankruptcy ruling places the company under the supervision
of court-appointed trustee, Mr. Hugo Adriano Zaragoza. The
trustee will verify creditors' proofs of claims until October
13, 2004. The validated claims will be presented in court as
individual reports on November 24, 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 February 8 next year.

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

CONTACT: Mr. Hugo Adriano Zaragoza, Trustee
         25 de Mayo 596
         Buenos Aires


MADERIN S.A.: Initiates Bankruptcy Proceedings
----------------------------------------------
Court No. 26 of Buenos Aires' Civil and Commercial Tribunal
declared Maderin S.A. "Quiebra," reports Infobae.

Mr. Pablo Kainsky, who has been appointed as trustee, will
verify creditors' claims until October 12, 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 23, 2004 followed by the general report on February 7,
2005.

Clerk No. 52 assists the court on the case, which will close
with the liquidation of the Company's assets to repay creditors.

CONTACT: Maderin S.A.
         Junin 425
         Buenos Aires

         Mr. Pablo Kainsky, Trustee
         Reconquista 715
         Buenos Aires


MERCADO DE MATERIALES: Enters Bankruptcy on Court Orders
--------------------------------------------------------
Court No. 2 of Buenos Aires' Civil and Commercial Tribunal
declared local company Mercado de Materiales S.A. bankrupt after
the company defaulted on its debt payments. The order
effectively places the company's affairs as well as its assets
under the control of court-appointed trustee, the accounting
firm "Estudio Amaya y Asociados".

As the trustee, the firm is tasked with verifying the
authenticity of claims presented by the company's creditors. The
verification phase is ongoing until October 26, 2004.

Following claims verification, the trustee will submit the
individual reports based on the forwarded claims for final
approval by the court on December 21, 2004. A general report
will also be submitted on March 2 next year.

Infobae reports that Clerk No. 4 assists the court on this case,
which will end with the disposal of the company's assets in
favor of its creditors.

CONTACT: "Estudio Amaya y Asociados" - Trustee
          Sarmiento 1586
          Buenos Aires


MOLINOS RIO: Yet to Decide on Poo Acquisition
---------------------------------------------
Argentine food company Molinos Rio de la Plata is analyzing
whether to buy local condiment and vinegar maker Poo from
investment fund Sabores Argentinos.

According to local news source El Cronista, Sabores Argentinos
holds a 66.7% stake in Poo, while the Poo family holds the
remaining stake. Molinos Rio is particularly interested in Poo's
Omega and Huser vinegar brands, with which it would be able to
strengthen its position in the domestic vinegar segment. Poo has
about 38% of the vinegar market, whereas Molinos' Cocinero brand
has a 10% share.

Like Molinos Rio, Poo has also suffered from financial
difficulties. But Poo has emerged from bankruptcy protection and
managed to obtain a 25% reduction in its debt of more than ARS11
million after carrying out successful renegotiations with its
main creditors Banco Rio, Societe Generale, Banco Frances and
Banco Sudameris. The approved proposal involved a 2-year grace
period and the payment of 75% of the debt over the period of 10
years.

Poo has also undertaken a deep restructuring process aimed at
reducing fixed costs. It involved a number of measures,
including the reduction of its workforce, the closure of its
Caballito plant and the concentration of its spice and vinegar
divisions at the Mataderos plant.

Meanwhile, Molinos Rio posted losses of ARS11.7 million in the
first half of the year. It is seeking to return to black by the
end of year.

CONTACT INFO: Molinos Rio de la Plata S.A.
              Uruguay 4075 CP (B1644HKG)
              Victoria
              Pcia. de Buenos Aires
              Argentina
              Telephone: 54-11-4340-1100

              Contacts:
              Maria Soledad Kern
              Investors Service
              Tel: (0054)-(11)-4340-1592
              E-mail: maria.soledad.kern@molinos.com.ar


ROLDAN Y CIA: Court Rules In Favor of Liquidation
-------------------------------------------------
Court No. 22 of Buenos Aires' Civil and Commercial Tribunal
ordered the liquidation of Roldan y Cia Objetos de Arte, Moblaje
y Antiguedades S.A. after the company defaulted on its
obligations, Infobae reveals.

The liquidation pronouncement will effectively place the
company's affairs as well as its assets under the control of Ms.
Marta Estela Acuna, the court-appointed trustee.

Ms. Acuna will verify creditors' proofs of claims until
September 27, 2004. The verified claims will serve as basis for
the individual reports to be submitted in court on November 9,
2004. The submission of the general report follows on December
22, 2004.

Clerk No. 44 assists the court on this case, which will end with
the disposal of the company's assets in favor of its creditors.

CONTACT: Ms. Marta Estela Acuna, Trustee
         Combate de los Pozos 129
         Buenos Aires


SKM S.A.: Court Approves Creditor's Bankruptcy Motion
-----------------------------------------------------
Judge Villar, serving for Court No. 13 of Buenos Aires' Civil
and Commercial Tribunal declared SKM S.A. bankrupt, says La
Nacion. The ruling comes in approval of the bankruptcy petition
filed by the Company's creditor, Banco Rˇo de la Plata S.A., for
nonpayment of US$26,987.04 in debt.

Trustee Jose Kahane will examine and authenticate creditors'
claims until September 24, 2004. This is done to determine the
nature and amount of the Company's debts. Creditors must have
their claims authenticated by the trustee by the said date in
order to qualify for the payments that will be made after the
Company's assets are liquidated.

Clerk No. 25, Dr. Guerri, assists the court on the case, which
will conclude with the liquidation of the Company's assets.

CONTACT: SKM S.A.
         Vuelta de Obligado 4047
         Buenos Aires

         Mr. Jose Kahane, Trustee
         Reconquista 715
         Buenos Aires


SOLSER S.R.L.: Gears for Reorganization
---------------------------------------
Court No. 19 of Buenos Aires' Civil and Commercial Tribunal,
with assistance from Clerk No. 38, issued a resolution opening
the reorganization of Solser S.R.L., 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.

Ms. Irma Aguilera will serve as trustee during the course of the
reorganization. She will be validating creditors' proofs of
claims until September 15, 2004. The results of the verification
will be presented in court as individual reports on October 28,
2004.

The trustee is also obligated to give the court a general report
of the case on December 10, 2004. The general report summarizes
events relevant to the reorganization and provides an audit of
the Company's accounting and business records.

Solser will present the completed settlement proposal to its
creditors during the informative assembly scheduled on June 16
next year.

CONTACT: Solser S.R.L.
         Sarmiento 647
         Buenos Aires

         Ms. Irma Aguilera, Trustee
         Luis Saenz Pe¤a 1690
         Buenos Aires


SUERTE S.A.: Court Declares Company Bankrupt
--------------------------------------------
Judge Gutierrez Cabello of Buenos Aires' Civil and Commercial
Tribunal Court No. 7 declared local company Suerte S.A.
"Quiebra", relates La Nacion. The order comes in approval of the
bankruptcy petition filed by Walker Hermanos S.A.

The tea distributor will undergo the bankruptcy process with Mr.
Lucian Melegari as its trustee. Creditors are required to
present their proofs of claims to the trustee for verification
before October 20, 2004.

Creditors who fail to have their claims authenticated by the
said date will be disqualified from the payments that will be
made after the Company's assets are liquidated at the end of the
bankruptcy process.

Dr. Giardinieri, Clerk No. 14, assists the court on the case.

CONTACT: Suerte S.A.
         Rivadavia 969
         Buenos Aires

         Mr. Luciano Melegari, Trustee
         Bartolome Mitre 1131
         Buenos Aires


TELECOM ARGENTINA: 94.4% of Creditors Accept Debt Offer
-------------------------------------------------------
Fixed-line carrier Telecom Argentina announced Monday that its
proposal to restructure US$2.63 billion of debt has been
accepted by creditors representing 94.4% of the total amount,
reports Dow Jones.

As what Telecom Argentina officials have expected, the final
result exceeded the 87% figure the company released two weeks
ago after the close of the offer period for its out-of-court
debt proposal, known in Spanish as an APE. Argentine bankruptcy
laws require two-thirds agreement from creditors before APEs can
be submitted to a local judge for legal approval, which then
makes the repayment terms binding on all creditors.

Telecom Argentina chief executive Carlos Felices earlier
predicted that the company should complete its debt swap in the
first quarter of 2005.

CONTACT:  TELECOM ARGENTINA S.A.
          Alicia Moreau de Justo 50, 10th Floor
          Capital Federal (1107) Republica Argentina
          Phone: +54 11 4968 4000
          Home Page: http://www.telecom.com.ar
          Contacts:
          Alberto J. Ricciardi, Chief Financial Officer
          Elvira Lazzati, Finance Director
          Pedro Insussarry, Investor Relations Manager
          Phone: (5411) 4968-3626/3627
          Fax: (5411) 4313-5842/3109
          E-mail: inversores@intersrv.telecom.com.ar


TRANSENER: Makes ARS8.7Mln Payment to Financiera Ludicor
--------------------------------------------------------
Argentine electricity transporter Transener SA (TRAN.BA)
informed the local stock exchange Friday that it has paid ARS8.7
million to a creditor that won a commercial court ruling against
the company in May, relates Dow Jones Newswires.

In May, the creditor, Financiera Ludicor SA, successfully
persuaded the court to block two payments totaling about ARS11.5
million that Transener was due to collect from Cammesa, the
national grid operator. The amount covered about one month's
worth of billings by Transener to Cammesa for wholesale power
delivery. The transporter used its own resources to cover its
operating costs for that month.

Dow Jones suggests that the ARS8.7 million that Transener had to
pay out poses a dangerous precedent for the ailing utility,
which has about US$520 million in debt but hasn't made any
significant advances with its creditors on new repayment terms.
Without progress on a restructuring deal, Transener leaves
itself especially vulnerable to lawsuits or bankruptcy petitions
that could result in further payouts.

CONTACT:  Paseo Colon 728 6th Floor
          (1063) Buenos Aires
          Republica Argentina
          Tel: (54-11) 4342-6925
          Fax: (54-11) 4342-7147
          Email: info-trans@transx.com.ar
          Web site: http://www.transener.com.ar



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

LORAL SPACE: Analyst Predicts Bright Prospect
---------------------------------------------
Patrick Fuhrmann, an independent satellite analyst, said that
the business prospects for a restructured Loral Space &
Communications Ltd. [LRLSQ] appear "very good," relates
Satellite News/Access Intelligence.

Loral and certain of its subsidiaries last week filed a proposed
plan of reorganization 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, 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 US$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.

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
===========

BANCO VOTORANTIM: S&P Rates Notes B+
------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' foreign-
currency long-term credit rating to Banco Votorantim S.A.
(Nassau Branch)'s $100 million fixed-rate notes (under its Euro
MTN program), to be issued in the beginning of September 2004
and maturing in September 2007. The repayment of these notes
will be in full at maturity. The local-currency credit ratings
on the bank are 'BB/Stable/B' and the foreign-currency credit
ratings are 'B+/Positive/B'.

"The ratings on Banco Votorantim S.A. reflect the potential
risks associated with the bank's treasury business and its
exposure to sovereign risk through its securities portfolio, a
common issue for Brazilian banks, and the risks associated with
the economic environment in Brazil, which may affect asset
quality," said Standard & Poor's credit analyst Daniel Araujo.
The ratings benefit from the implicit support of the Votorantim
Group (foreign currency: B+/Positive/--; local currency: BBB-
/Stable/--); the group's image and strong brand name
recognition; and the bank's good profitability, experienced
management team, and efficient decision-making processes.

The Votorantim Group is one of the largest and most influential
industrial conglomerates in Brazil. Its brand-name recognition
has helped the bank to leverage on its business, and the images
of both organizations are closely linked. The conglomerate
supervises the bank's activities and operations, and its
conservatism permeates the bank's activities. Banco Votorantim's
management is made up of professionals with vast experience in
the financial markets and the Group's companies.

The positive outlook on Banco Votorantim's foreign currency
issuer credit rating mirrors that of the foreign currency
sovereign credit rating of Brazil.

The stable outlook on the bank's local-currency issuer credit
rating incorporates the economic risks of the Brazilian banking
industry and the balance between its good business profile, good
management, high profitability, and the potential risks related
to the quality of its growing private loan portfolio, especially
its consumer loans segment and its government securities.


CEMIG: Deloitte Touche Tohmatsu Presents Audit Report
-----------------------------------------------------
Deloitte Touche Tohmatsu released the following audit statement
in its review of Companhia Energetica de Minas Gerais'(CEMIG)
financial statements for the quarter and semester ended June 30,
2004:

INDEPENDENT AUDITORS' REVIEW REPORT

To the Shareholders and the Board of Directors of Companhia
Energetica de Minas Gerais-CEMIG, Belo Horizonte-MG

1. We have performed a special review of the quarterly
information, presented in Brazilian reais, of Companhia
Energ‚tica de Minas Gerais-CEMIG and subsidiaries (Company and
Consolidated) for the quarter and semester ended on June 30,
2004, prepared under the responsibility of the Company's
management, in accordance with accounting practices adopted in
Brazil, consisting of the balance sheets, statements of
operations and management's discussion and analysis.

2. We conducted our review in accordance with specific standards
established by the Brazilian Institute of Independent Auditors
(IBRACON), together with the Federal Accounting Council, which
consisted principally of: (a) inquiries and discussions with
management responsible for the accounting, financial and
operating areas of the Company and its subsidiaries as to the
principal criteria adopted in the preparation of the quarterly
information, and (b) review of the information and subsequent
events that had or might have had significant effects on the
Company's and its subsidiaries' financial positions and results
of operations.

3. Based on our special review, we are not aware of any material
modifications that should be made to the quarterly information
referred to in paragraph 1 above for it to be in conformity with
accounting practices adopted in Brazil and accounting standards
issued by the Brazilian Securities Commission (CVM),
specifically applicable to the preparation of mandatory
quarterly financial information.

4. As mentioned in the quarterly information as of June 30,
2004, the Company and its subsidiaries have recorded assets,
liabilities, revenues and expenses related to energy sales,
purchases and other transactions occurred on the Wholesale
Energy Market-MAE. Such amounts were recorded based on
calculations prepared and information made available by MAE
regarding transactions through June 30, 2004. Those amounts are
subject to change, depending on the outcome of claims currently
in progress in court, filed by electric energy companies,
concerning the interpretation of the market rules in force at
the time that those transactions occurred.

5. The balance sheets (Company and Consolidated) as of March 31,
2004, presented for comparative purposes, were reviewed by us as
set forth in our special review report dated April 30, 2004,
issued without qualification and including emphasis regarding
the matter discussed in paragraph 4 above. The statements of
income (Company and Consolidated) for the quarter and semester
ended on June 30, 2003, presented for comparative purposes, were
reviewed by us as set forth in our special review report dated
on July 31, 2003 without qualification and including emphasis
regarding the matter discussed in paragraph 4 above.

DELOITTE TOUCHE TOHMATSU
Auditores Independentes

Mr. Gilberto Grandolpho
GILBERTO GRANDOLPHO
Engagement Partner

CONTACT: Cemig-Companhia Energetica
         AV. Barbacenda 1200
         Bello Horizonte MG
         30161-970
         Brazil

         Web Site: www.cemig.infoinvest.br


SKY BRASIL: S&P Upgrades Issuer Credit Rating To B-
---------------------------------------------------
Standard & Poor's Rating Services raised its issuer credit
rating on Brazil-based pay-TV provider Sky Servicos Ltda. to 'B-
' from 'CCC+'. The outlook is positive.

The rating action reflects the successful refinancing of the
company's $200 million Senior Notes due on Aug. 5, 2004. To fund
this payment, the company borrowed under a long-term credit
facility with Citibank and JP Morgan.

"The rating on Sky reflects the still-challenging market
environment for pay-TV in Brazil, given income constraints,
economic volatility and uncertain growth prospects, and the
company's weak financial measures and dependence on
shareholders' support," said Standard & Poor's credit analyst
Milena Zaniboni.

The ratings incorporate Standard & Poor's assumption that
shareholders, mainly News Corp. Ltd., will continue to support
Sky. Standard & Poor's believes that there are stronger
incentives now for News Corp. to contribute to Sky as the
subsidiary continues to increase its subscriber count and market
share, and as it gradually approaches financial sustainability,
thus reducing the risk to News Corp. of any capital allocated to
the Brazilian subsidiary.

Sky Brasil has been systematically adding subscribers to its
base, which reached 805,800 in second-quarter 2004, a 6%
increase compared to the same period in 2003. Sky is estimated
to have a 60% share of the Brazilian DTH market, and 23% of the
total pay-TV industry. Accordingly, operational results have
been stronger and more consistent as the company showed its
capacity to pass through cost increases, lowered consumer
equipment subsidies, and successfully converted programming
contract pricing from U.S. dollars to local pricing terms.

Sky Brasil's noteworthy financial improvements still do not
enable the company to absorb its current debt and financial
expense burden. In the first half of 2004, shareholders
contributed $14.7 million, mostly to cover interest payments on
the Senior Notes in February. Nevertheless, the need for
financial support from shareholders has decreased in the past
two years as Sky demonstrates stronger financial results. The
company's capacity to grow and eventually produce cash flow is
dependent on shareholders' willingness to continue funding its
subscriber acquisition costs (SAC). Despite Sky Brasil's
significant efforts to reduce SAC during the past several
quarters, attracting subscribers is particularly expensive for
DTH providers due to the high costs of the set-top boxes. Since
2002, News Corp. has been the major contributing shareholder to
Sky, and shareholders are expected to negotiate new terms for
the shareholders' agreement to reflect the dilution of Globopar
S.A.'s interest in Sky.

Sky Brasil is the largest provider of Ku-band satellite services
in Brazil, with more than 800,000 digital subscribers as of June
2004. Its footprint covers the entire country, reaching areas
not passed by cable, MMDS, or other DTH operators. The company
markets its service under the Sky brand, and is controlled by
News Corp., Globopar S.A., and Liberty Media Corp. The company
has many competitive advantages compared with other major pay-TV
providers, such as a fully digital platform and capacity to
offer fee-based interactive products and services, and exclusive
DTH programming, which together should represent significant
growth opportunities.

The positive outlook reflects that the rating on Sky could be
further improved if the company is able to maintain its trend of
improving financial performance, and begins to present positive
FFO and EBITDA-to-interest coverage stronger than 1x. It also
takes into consideration that Standard & Poor's expects the
company will continue to need financial support from
shareholders to support its growth and SAC costs, but Standard &
Poor's believes that there are stronger incentives to continue
to support the company as Sky's operations become more
sustainable. Conversely, the rating would stabilize at the
current category if the expected improvement in financial
measures does not materialize, and it could come under downward
pressure if there is a change in perception of shareholders'
support.


VARIG: Gains Case Support From Second Justice
---------------------------------------------
Justice Luiz Fux of Brazil's Appeals Court (STJ) voted Tuesday
that the government acted illegally by imposing price freezes on
Viacao Aerea Rio Grandense SA (Varig), the country's largest
airline.

According to Dow Jones Newswires, Justice Fux is the second STJ
justice to decide on the case. In May, before voting was
suspended, Justice Francisco Falcao voted to support the case
brought by Varig against the government.

Varig is suing the government for freezing prices between 1985
and 1993. The company had originally requested US$1.5 billion in
damages but Justice Falcao ruled in May to adjust the
calculation of potential liabilities to about BRL1.9 billion.

Three judges are yet to hand down their decisions. The third
judge, Justice Teori Albino Zavascki, has requested more time to
examine the case, a court spokesman said, adding that the
hearing would restart as soon as possible, although there is no
time limit.

If Varig wins this case, it would gain temporary respite from
the burden of its BRL6 billion of debts, says Dow Jones. A
ruling either way is likely to trigger a long-term solution for
the struggling airline.

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


* S&P Affirms Ratings, Foreign Currency Outlook On Brazil
---------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' long-term
foreign, 'BB' long-term local, and 'B' short-term local and
foreign currency sovereign credit ratings on the Federative
Republic of Brazil. Standard & Poor's also affirmed the positive
outlook on the long-term foreign currency rating, assigned Dec.
11, 2003, which reflects declining external vulnerability
underpinned by ongoing marked improvement in Brazil's trade
balance amid continued fiscal and monetary discipline. The
stable outlook on the long-term local currency rating was also
affirmed.

"Continued progress in reducing Brazil's fiscal and external
vulnerabilities and policies to support moderate GDP growth of
3.5%-4.0% beyond the 2004-2005 cyclical recovery would support
improved creditworthiness," said Standard & Poor's Ratings
Services credit analyst Lisa M. Schineller. "Brazil's medium-
term growth outlook remains somewhat vulnerable unless bolstered
by increased private sector investment."

Ms. Schineller explained that, given Brazil's large fiscal debt
burden (projected net general government debt of 63% of GDP and
interest/revenue of 20% in 2004), improved creditworthiness will
require continued delivery of the targeted nonfinancial sector
primary (noninterest) surplus of 4.25% of GDP over the next
several years. In addition, continued advances in domestic debt
management are critical to further insulate the fiscal accounts
and debt burden from interest- and exchange-rate fluctuations.

"Steps to encourage private sector domestic and foreign
investment would bolster confidence that Brazil could grow 3%-4%
annually beyond 2004-2005 (in contrast with Brazil's average
annual GDP growth of 1.7% during 1999-2003)," Ms. Schineller
noted. "Toward that end, evidence of an improving business
climate-such as passage and/or implementation of reform pending
in Congress (bankruptcy, regulatory, and judicial) and recent
tax measures-could trigger an upgrade," she concluded."


* BRAZIL: Gets $505M World Bank Loan for Environmental Projects
---------------------------------------------------------------
The World Bank Board of Executive Directors approved Tuesday the
First Programmatic Reform Loan for Environmental Sustainability,
in the amount of US$505 million, to support Brazil's goal of
balancing economic growth with social development and the
maintenance and improvement of environmental quality.  In line
with the Bank's Country Assistance Strategy (CAS) for Brazil,
the loan seeks to contribute to a more sustainable Brazil,
helping to reduce poverty and achieve a higher quality of life
in rural and urban areas and building on the country's
comparative advantage in natural resources while helping
conserve them.

"One of the most important features of the Government's
environmental strategy, recognized and supported by this loan,
is its strong focus on involving all relevant players around key
issues in the sector, something unprecedented in Brazil," said
Marina Silva, Brazil's Environment Minister.

In few countries is the national environment as crucial to
development and people's welfare as in Brazil.  Brazil has one
third of the world's tropical rain forests, the largest
reservoir of fresh water (20 percent), one of the longest
coastal lines with over 8,500 km, and the savanna with the
highest biodiversity in the world.

A significant part of Brazil's economy relies on the use of
natural resources for production inputs or to store waste.
Despite the importance of its natural resource base, Brazil
faces major challenges to reverse a trend of unsustainable use
of its natural resources.

Over the past two decades Brazil has done a great deal to
improve environmental management at both the national and sub-
national levels.  The loan recognizes the current
administration's efforts and achievements to better integrate
environmental objectives with social and economic ones,
including policy and institutional changes leading to more
effective environmental management and the improvement of
environmental conditions in the medium and long term.  The loan
will not generate additional spending on the part of the
Government and will support the country's external currency
needs.

Overall, the program aims to help increase the efficiency and
effectiveness of Brazil's environmental management system
(SINAMA), and mainstream environmental and sustainable use of
natural resources in the government's policy decisions,
especially in economic planning.

"The costs to society from environmental destruction are high,
rough estimates placing them at as much as 4% of the country's
GDP," said Vinod Thomas, World Bank Director for Brazil. "The
gains to society from environmental protection accrue especially
to the poor, because their incomes are primarily derived from
environmental assets."

Improving environmental management, monitoring and regulation:

The loan supports fundamental first steps by the Government to
modernize the environmental management system in light of the
broader growth agenda, improvements in the business environment,
and better quality of life for Brazilians.

The set of policy and institutional reforms covered by the loan
are based on the Government's Environmental Reform Agenda and
Multi-Year Plan (PPA) and include: (i) increasing the
transparency and social control of the environmental management
system (SISNAMA); (ii) improving the effectiveness of SISNAMA
through better coordination and clearer definition of
responsibilities among the three levels of government; (iii)
promoting sustainable development in the Amazon and the
protection of other key ecosystems; and (iv) improving water
resources management through increased decentralization,
improved local management and increased financial autonomy.

The loan has also promoted a process for bridging the gap
between the views of various sectors in government, the private
sector, and civil society in a way that will facilitate the
modernization of SISNAMA and open the way for the mainstreaming
of environmental issues in the Government.

Mainstreaming environmental issues in governmental policy:

A second focus of the loan is the "mainstreaming" of
environmental concerns in and with other sectors.  Poor
integration of environmental policies in sector and
macroeconomic policies often causes environmental aspects to be
considered too late in project planning and sector policy
design, leading to high social and economic costs for the
country.

Highlighting the upstream inclusion of environmental
sustainability concerns in sector policies and programs, six
important sector ministries (Finance, Mines and Energy, Agrarian
Development, National Integration, Cities and Tourism), in
addition to the Environment, signed the loan's Letter of
Development Policy.  The initial priority themes for
mainstreaming include support for environmentally sustainable
development in the Amazon, urban planning, regional land use and
development planning, fiscal and financial policies, licensing
for energy and infrastructure, agrarian reform and eco-tourism.

"There are many win-win opportunities for policies that are good
for the poor, the environment, and growth,"said Luiz Gabriel
Azevedo, World Bank Sector Leader for Environmentally and
Socially Sustainable Development and Task Manager of the
Program.   "They will depend on the capacity of ministries and
other economic sectors to incorporate environmental
considerations in their sector and macro policies."

The loan approved Tuesday is the first of a program of three
loans over a four-year period, totaling up to US$ 1.2 billion.
The loans complement existing programmatic approaches involving
both investment and capacity building in key priority areas such
as public sector environmental management at the national and
sub-national levels.  Two technical assistance projects will
help develop Government capacity for the second and third phases
of the program.

This fixed-spread loan in US dollars has a repayment period of
17 years, including five years of grace.

The World Bank's current investment portfolio in Brazil includes
50 projects, totaling more than US$4.5 billion in commitments.
Since 1949, the Bank has made more than 300 loans and invested
more than US$33 billion to promote poverty reduction, social and
economic development in Brazil.

CONTACTS: In Washington
          Ms. Angela Furtado
         (202) 473 1909
          Afurtado@worldbank.org

          In Brasilia:
          Mr. Mauro Azeredo
         (55-61) 329-1059
          mazeredo@worldbank.org

          Web Site: http://www.worldbank.org



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

AVIANCA: Restructuring Plan Obtains US Judge's Approval
-------------------------------------------------------
Colombian flagship airline Avianca announced Tuesday that a US
bankruptcy judge has approved a restructuring plan based on the
sale to Brazil's Sinergy, says Dow Jones Newswires.

Sinergy, which wants Avianca to complement its Brazilian
regional carrier, Ocean Air, has offered to make a US$64-million
cash injection into Avianca and assume its debt of about US$300
million.

Judge Allan L. Gropper in Manhattan has also extended by 60
days, through Oct. 31, the airline's exclusive period for
soliciting creditor support for the restructuring plan.

The company, currently owned by the National Federation of
Coffee Growers and local conglomerate Valores Bavaria
(VALBAVARI.BO), said it will provide a complete disclosure
statement to creditors with voting rights on Sept. 3.

An Avianca press officer said 280 creditors will now have to
endorse the restructuring plan.

Avianca filed for Chapter 11 bankruptcy protection in March last
year, pressured by rising fuel and insurance costs and slow
economies in Colombia and Venezuela. Because it has a subsidiary
in the United States, the airline was able to take advantage of
US bankruptcy law, which allowed it to keep operating while
negotiating with creditors.

Founded in 1919, Avianca says it is the world's second-oldest
airline after Dutch carrier KLM. It is Colombia's biggest
commercial carrier, with 290 flights a day and service to 17
destinations abroad.

After years of losses, Avianca reported a net profit of US$6.9
million in the first half of 2004, compared to a loss of US$23.5
million in the first half of last year.


* Colombia: Not Seeking to Extend IMF Loan Agreement
----------------------------------------------------
Mr. Robert Rennhack, who leads an International Monetary Fund
mission to Colombia, told reporters Tuesday that the IMF has not
yet received any information from Colombia regarding the
extension of a loan.

Dow Jones reveals that Colombia currently has a two-year stand-
by loan for US$2.1 billion, which expires in December.

Finance Minister Alberto Carrasquilla said that he would like to
extend the agreement with the IMF, but that no decision has been
made yet.

"The agreement is convenient for the country, but we don't know
yet if we are going to extend the program or to begin a new loan
with the IMF," said Carrasquilla.

Colombia's foreign debt is heading lower. The central bank
revealed late Monday that foreign debt held by the government
and the private sector stood at US$37.86 billion in May, down
1.9% from US$38.57 billion in the year-earlier month.

Analysts said the lower debt load is largely explained by the
strength of the peso, the country's economic rebound and a
growing policy of substituting foreign debts with liabilities
denominated in the local currency.



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

AES-ANDRES: Hounds Government for $23Mln Debt
---------------------------------------------
AES-Andres stated that its operations in the Dominican Republic
could be seriously compromised unless the government pays back
debts totaling US$23 million.

Local daily El Caribe says that AES needs the government's money
to buy the liquid natural gas used in powering its plants. A low
fuel supply, according to AES, will force the plants to shutdown
and it could only be reopened in February next year.

AES's generators recently went back online after the company
secured US$15 million shipload of LNG for its facilities. The
362MW of power that the plant produces has eased the country's
energy situation. However, this is seen as a temporary solution
because the purchase was funded by internal sources.



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

C&WJ: President Moves to London to Take on Senior Position
----------------------------------------------------------
Gary Barrow is quitting his job as president of Cable & Wireless
Jamaica to take up a position with the parent company in the UK,
The Jamaica Observer reports.

In a statement, Cable & Wireless said Barrow will have a senior
director's job "with responsibility for regulations,
communications and strategy for many of the C&W national
telecoms operations across the world." He is to take up his new
job on October 1. A successor will be named within two weeks.

Barrow has headed Cable & Wireless' operations in Jamaica for
the past three-and-a-half years. His new appointment fuelled
speculations that the parent company was not fully satisfied
with the way in which C&W Jamaica was faring in the local
market.

But Barrow said the parent company gave him the London job to
utilize his skills closer at the top of the organization.



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

ROYAL SHELL: Bay Named Exploration Director for EP Americas
-----------------------------------------------------------
Shell Exploration & Production (Shell) has named Annell Bay
regional exploration director for EP Americas.  In this
position, Bay will lead exploration activities in the Americas
including current areas of activity in the Gulf of Mexico,
onshore North America and offshore Brazil, as well as new
venture opportunities throughout the Americas.

Bay joins Shell from Kerr-McGee, where she was vice president of
worldwide exploration. Previous positions held by Bay at Kerr-
McGee include: vice president North America exploration,
exploration manager US onshore and director of international
exploration.

Prior to joining Kerr-McGee, Bay worked as an exploration
geologist with Shell, Chevron, Sohio/BP and Oryx Energy.  Her
experience in exploration includes ventures in onshore United
States, Gulf of Mexico, Ecuador, Russia, Australia, Southeast
Asia and Kazakhstan.

She holds a master's degree in geology from the University of
Texas at Austin and a bachelor's degree in geology from Trinity
University in San Antonio.  She is currently a member of the
Advisory Council for the University of Texas at Austin Geology
Foundation, the Corporate Advisory Committee for the American
Association of Petroleum Geologists and the Houston Geological
Society.

Shell companies have been exploring for and producing
hydrocarbons for more than a century.  Our Exploration and
Production business searches for and recovers oil and gas around
the world and is active in 34 countries.

CONTACT: Media Relations
         Shell Centre
         London SE1 7NA
         UK

         Ms. Lisa Givert
         Tel +44 (0)20 7934 2914

         Ms. Stuart Bruseth
         Tel +44 (0)20 7934 6238



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

BWIA: Cuts Losses to $6.5M in 1H04
----------------------------------
Trinidad and Tobago's BWIA posted a sharp cut in losses for the
first half of 2004 as the troubled airline continues to
stabilize its operations.

The Trinidad Guardian reports that despite a fuel hike, BWIA
managed to bring down its loss to US$6.5 million for the six-
month period ended June 30, 2004 from US$14.6 million a year
earlier.

BWIA has been in dire straits since the September 11 terror
attacks that had caused a significant drop in passengers. Last
year, the Company retrenched a fourth of its 2,400 workers in a
move to reduce operating costs. However, the airline continues
to struggle with its massive debt, estimated at US$100 million.

The Trinidad Government recently raised its stake in BWIA to 75
percent after a failed debt-for-equity swap that it had
underwritten. The Government plans to discharge its BWIA
holdings once the carrier once again becomes attractive to
investors.

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



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

BANCO DE DESARROLLO: Group Holding Venezuelan Government Liable
---------------------------------------------------------------
Venezuela could be liable for the US$100 million worth of notes
issued in 1981 by the defunct government-sponsored bank Banco de
Desarrollo Agropecuario S.A.

The Associated Press reveals that Syke Ventures, an investment
group holding US$100 million of the US$1 billion total bond
issue, has filed the charges at a U.S. District Court.

Columbus attorney Luis Alcalde explains that the suit stems from
the Venezuelan government's moves to delay the maturity of the
10-year notes. In addition, the country's finance minister has
also refused to repay the debt despite the attorney general's
confirmation of the validity of the instruments.

Remaining note holders from Europe and South America could also
join the lawsuit, the report adds.


PDVSA: Completes Construction of Jose Terminal Dock
---------------------------------------------------
Mr. Felix Rodriguez, vice president of Petroleos de Venezuela
SA, told Venpres state news agency Tuesday that the state oil
company has completed construction of a dock at the Jose
terminal, Dow Jones Newswires relates.

The new platform, according to Rodriguez, "will allow us to dock
three tankers simultaneously and increase the capacity for
shipping crude and derivatives to the United States and Europe."

The dock was constructed by PDVSA and the Ameriven heavy crude
joint venture. Ameriven is a joint venture between
ConocoPhillips (COC), ChevronTexaco Corp. (CVX) and PDVSA.

Venezuela loaded 46 ships at the terminal in April. Officials
have said the new dock, which cost an estimated $300 million to
build, will increase monthly loading to 55 ships a month.



                            ***********


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
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and
Lucilo Junior M. Pinili, Editors.

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

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.

Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.

The TCR Latin America subscription rate is $575 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial
subscription or balance thereof are $25 each.  For subscription
information, contact Christopher Beard at 240/629-3300.


* * * End of Transmission * * *