TCRLA_Public/050106.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, January 6, 2005, Vol. 6, Issue 4


                            Headlines


A R G E N T I N A

DISCO: Ahold Fights Court Over Sale
AOL LATIN AMERICA: Enters Into LOI to Negotiate Merger With LN
CARAMI S.A.: Reorganization Proceeds To Bankruptcy
CONSTRUCCIONES PATAGONICAS: Court Sets Assembly Date
EMPRESA EXPRESO: Begins Liquidation Process

EXECUTIVES S.A.: Court Names Bankruptcy Trustee
FISH S.A.: Court Orders Liquidation
FUNDEBA: Enters Bankruptcy on Court Orders
GEMINIS S.R.L.: Initiates Bankruptcy Proceedings
INGEFER S.A.: Liquidating Assets to Pay Debts

INSTITUTO ACUARIO: Bankruptcy Process Begins By Court Order
LAGORIO ARGENTINA: Court Rules for Liquidation
LISE DE ARGENTINA: Court Issues Bankruptcy Ruling
MET-OLMAR S.R.L.: Court Declares Company Bankrupt
METALURGICA SANITARIA: Initiates Bankruptcy Proceedings

SASPI S.A.: Liquidates Assets to Pay Debts
VAGRA S.R.L.: Enters Bankruptcy on Court Orders


B R A Z I L

BANCO INDUSVAL: S&P Assigns 'B' Rating; Stable Outlook
BRASKEM: Details Plans to Pay Interest on Capital
CEMIG: Explains Obligatory Exchange of Debentures
CESP: To Issue New Shares, Debentures This Year
CFLCL: Final Tune-Up Begins For Ivan Botelho III

GERDAU: Expands Operations to Colombia
TCP: Announces Results of Jan. 4 Public Auction


C H I L E

EDELNOR: S&P Issues Report on Ratings
ENAMI: Expects Up to $70M Profit This Year


E L   S A L V A D O R

BANCO SALVADORENO: S&P Releases Report on Ratings


M E X I C O

TV AZTECA: SEC Charges Company, Chairman With Fraudulent Scheme


U R U G U A Y

UTE: To Import More Power From Brazil Says President


V E N E Z U E L A

PDVSA: Largest Labor Group Snubs New Labor Contract

     -  -  -  -  -  -  -  -

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


DISCO: Ahold Fights Court Over Sale
-----------------------------------
Ahold announced yesterday that it will appeal certain new court
orders that could potentially affect the sale of Disco S.A. in
Argentina to Cencosud S.A.

On December 23, 2004, the Court of Appeal in Mendoza rendered
various decisions in the pending litigation regarding the
obtaining of antitrust approval for the sale of Disco. The Court
of Appeal, among other things, denied suspensive effect of the
appeal filed earlier by Ahold's subsidiary Disco Ahold
International Holdings N.V. ("DAIH") in respect of an order of a
local court in San Rafael, Mendoza, as announced by Ahold on
December 8, 2004. If ultimately enforced the adverse court
orders could lead the parties to reverse the transfer of the
Disco shares to Cencosud, at least temporarily.

The merits of DAIH's appeal on that matter have not yet been
addressed by the Court of Appeal. Ahold is still reviewing the
consequences of the decisions rendered by the Court of Appeal
and is preparing an appeal to the Argentine Supreme Court on the
adverse court orders.

Ahold announced the transfer of the controlling interest in
Disco to Cencosud on November 1, 2004, following an earlier
announcement of the transaction on March 5, 2004. Ahold believes
that the transfer of the Disco shares as effected is in the best
interests of Disco's customers and associates, which Ahold
believes were being adversely affected by the delay in the
antitrust approval process and the closing of the transaction.

CONTACT: Ahold Corporate Communications
         Royal Ahold N.V.
         P.O. Box 3050 1500 HB
         Zaandam Netherlands
         Phone: +31 (0)75 659 57 20
         Fax: +31 (0)75 659 83 02
         Web Site: http://www.ahold.com


AOL LATIN AMERICA: Enters Into LOI to Negotiate Merger With LN
--------------------------------------------------------------
AOL Argentina, S.R.L. ("AOL Argentina"), a wholly-owned
subsidiary of America Online Latin America, Inc. ("AOLA"),
entered on December 30, 2004 into a preliminary letter of intent
to negotiate a merger of its ISP business in Argentina and
certain related assets and liabilities with and into S.A. La
Nacion ("LN"). The consideration for the transaction is expected
to be the issuance of shares of La Nacion stock, but final
determination of the number of shares to be issued is subject to
agreement and further due diligence. The transaction is subject
to the negotiation of definitive agreements, including a license
of brand rights in exchange for a cash payment, requisite
corporate approvals and approval by the holder of AOLA's senior
convertible notes, and there can be no assurance that the
transaction will be consummated. Although as a result of the
consummation of the transaction AOL Argentina would cease to own
an ISP business, it would retain its call center and digital
developments businesses.

CONTACT: America Online Latin America, Inc.
         6600 N. Andrews Ave.
         Suite 500
         Fort Lauderdale, FL 33309
         USA
         Phone: 954-229-2100


CARAMI S.A.: Reorganization Proceeds To Bankruptcy
--------------------------------------------------
The reorganization of local Company Carami S.A. has progressed
into bankruptcy. Argentine news source Infobae relates that the
civil and commercial tribunal of Buenos Aires ruled that the
Company is "Quiebra Decretada".

The report adds that the court assigned Mr. Francisco Rogelio
Cano as trustee. He will verify creditors' proofs of claim until
March 28.

The court also ordered the trustee to prepare individual reports
after the verification process is completed, and have them ready
by May 11. A general report on the bankruptcy process is
expected on June 23.

CONTACT: Carami S.A.
         Humboldt 550
         Buenos Aires

         Mr. Francisco Rogelio Cano, Trustee
         Uruguay 618
         Buenos Aires


CONSTRUCCIONES PATAGONICAS: Court Sets Assembly Date
----------------------------------------------------
The civil and commercial tribunal of Comodoro Rivadavia (Chubut)
has scheduled the informative assembly for the Obras y
Construcciones Patagonicas S.R.L. reorganization case on March
10, says Infobae.

Creditors of the Company will vote to ratify the settlement
proposal during the assembly. Mr. Juan Antonio Martinez serves
as trustee on this case.

CONTACT: Obras y Construcciones Patagonicas S.R.L.
         Francisco Segui 1849
         Rada Tilly (Chubut)

         Mr. Juan Antonio Martinez, Trustee
         Italia 846
         Comodoro Rivadavia (Chubut)


EMPRESA EXPRESO: Begins Liquidation Process
-------------------------------------------
Empresa Expreso City Bell S.R.L. (Linea 273) of La Plata will
begin liquidating its assets after Court No. 17 of the city's
civil and commercial tribunal declared the Company bankrupt.
Infobae reveals that the bankruptcy process will commence under
the supervision of accounting firm "Estudio Llanos y Otros", the
court-appointed trustee.

The firm will review claims forwarded by the Company's creditors
until March 11. After claims verification, the trustee will
submit the individual reports for court approval on April 25.
The general report submission should follow on June 8.

CONTACT: Empresa Expreso City Bell S.R.L. (Linea 273)
         Calle 134 Nro. 2218
         La Plata

         "Estudio Llanos y Otros"
         Trustee
         Calle 47 Nro. 826
         La Plata


EXECUTIVES S.A.: Court Names Bankruptcy Trustee
-----------------------------------------------
Buenos Aires accountant Maria A. Adornetto was assigned trustee
for the liquidation of local Company Executives S.A. Consultores
en Seleccion de Personal, relates Infobae.

The trustee will verify creditors' claims until February 8.
After that, she will also prepare the individual reports, which
are to be submitted in court on March 22. The general report
submission should follow on May 5.

CONTACT: Ms. Maria A. Adornetto, Trustee
         Suipacha 670
         Buenos Aires


FISH S.A.: Court Orders Liquidation
-----------------------------------
Fish S.A. prepares to wind-up its operations following the
bankruptcy pronouncement issued by the civil and commercial
tribunal of Buenos Aires. 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 Ms. Liliana Maria
Montoro as trustee. She will be reviewing creditors' proofs of
claims until March 21. The verified claims will be the basis for
the individual reports to be presented for court approval on May
5. Afterwards, the trustee will also submit a general report on
June 17.

CONTACT: Fish S.A.
         Uruguay 1252
         Buenos Aires

         Ms. Liliana Maria Montoro, Trustee
         Sarmiento 517
         Buenos Aires


FUNDEBA: Enters Bankruptcy on Court Orders
------------------------------------------
Buenos Aires' civil and commercial Court No. 2 declared
Fundacion Para El Desarrollo de Buenos Aires (Fundeba) bankrupt
after the Company defaulted on its debt payments. The
liquidation will proceed under the direction of trustee Beatriz
Laura Colucci.

As trustee, Ms. Colucci is tasked with verifying the
authenticity of claims presented by the Company's creditors. The
verification phase is ongoing until March 10.

Following claims verification, the trustee will submit the
individual reports based on the forwarded claims for final
approval by the court on April 21. A general report will also be
submitted on June 3.

Infobae reports that Clerk No. 3 assists the court on this case
that will end with the disposal of the Company's assets to repay
its debts.

CONTACT: Ms. Beatriz Laura Colucci, Trustee
         Eduardo Acevedo 217
         Buenos Aires


GEMINIS S.R.L.: Initiates Bankruptcy Proceedings
------------------------------------------------
The civil and commercial tribunal of Buenos Aires declared
Geminis S.R.L. "Quiebra," reports Infobae.

Mr. Mario Norberto Aragon, who has been appointed as trustee,
will verify creditors' claims until February 28 and then prepare
the individual reports based on the results of the verification
process.

The individual reports will be submitted in court on April 25,
followed by the general report on June 06.

CONTACT: Geminis S.R.L.
         Cochabamba 2536
         Buenos Aires

         Mr. Mario Norberto Aragon, Trustee
A Alsina 1535
         Buenos Aires


INGEFER S.A.: Liquidating Assets to Pay Debts
---------------------------------------------
Ingefer S.A. will begin liquidating its assets following the
pronouncement of Buenos Aires' civil and commercial court that
the Company is bankrupt, Infobae reports.

The ruling places the Company under the supervision of court-
appointed trustee Nelida Haydee Grunblat de Nobile. Ms. De
Nobile will verify creditors' proofs of claims until March 7.
The validated claims will be presented in court as individual
reports on April 20.

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 June 6.

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

CONTACT: Ingefer S.A.
         Sarmiento 4406
         Buenos Aires

         Ms. Nelida Haydee Grunblat de Nobile, Trustee
         Felipe Vallese 1195
         Buenos Aires


INSTITUTO ACUARIO: Bankruptcy Process Begins By Court Order
-----------------------------------------------------------
The civil and commercial tribunal of Buenos Aires declared
Instituto Acuario S.R.L. "Quiebra," reports Infobae. The
declaration signals the Company to proceed with the bankruptcy
process, which will close with the liquidation of its assets.

The court appointed Mr. Otto Reinaldo Munch as Trustee who will
authenticate proofs of claim until March 24.

CONTACT: Mr. Otto Reinaldo Munch, Trustee
         Maipu 509
         Buenos Aires


LAGORIO ARGENTINA: Court Rules for Liquidation
----------------------------------------------
Court No. 15 of Buenos Aires' civil and commercial tribunal
ordered the liquidation of Lagorio Argentina S.A. after the
Company defaulted on its obligations, reveals Infobae. The
liquidation pronouncement will effectively place the Company's
affairs as well as its assets under the control of Mr. Luis
Leonidas Abranzon, the court-appointed trustee.

Mr. Abranzon will verify creditors' proofs of claims until March
10, 2005. The city's Clerk No. 29 assists the court on this case
that will end with the disposal of the Company's assets to repay
its debts.

CONTACT: Mr. Luis Leonidas Abranzon, Trustee
         Pringles 835
         Buenos Aires


LISE DE ARGENTINA: Court Issues Bankruptcy Ruling
-------------------------------------------------
Lise de Argentina S.A. of Buenos Aires will now enter bankruptcy
after the city's local civil and commercial tribunal declared it
"Quiebra," reports Infobae.

Mr. Barg Lajbisz will supervise the liquidation proceedings as
trustee. He will verify creditors' claims until March 15.

The Company's bankruptcy case will close with the liquidation of
its assets to pay its creditors.

CONTACT: Mr. Barg Lajbisz, Trustee
         Paraguay 2630
         Buenos Aires


MET-OLMAR S.R.L.: Court Declares Company Bankrupt
-------------------------------------------------
Met-Olmar S.R.L. entered bankruptcy on orders from the civil and
commercial tribunal of Buenos Aires, says Infobae.

Mr. Norberto Jorge Volpe, acting as trustee, will verify
creditors claims until April 12. Creditors who fail to have
their claims validated before the deadline will be disqualified
from receiving any payments to be made after the Company's
assets are liquidated.

The individual reports, which are due on April 24, are to be
prepared upon completion of the verification process. The court
also requires the trustee to prepare a general report and file
it on June 6. This report contains a summary of the results in
the individual reports.

CONTACT: Mr. Norberto Jorge Volpe, Trustee
         Maipu 859
         Buenos Aires


METALURGICA SANITARIA: Initiates Bankruptcy Proceedings
-------------------------------------------------------
The civil and commercial court of Buenos Aires declared
Metalurgica Sanitaria S.A. "Quiebra," reports Infobae.

Mr. Antonio Gargiulo, who has been appointed as trustee, will
verify creditors' claims until February 22 and then prepare the
individual reports based on the results of the verification
process.

The individual reports will be submitted in court on April 19
followed by the general report on May 31.

CONTACT: Mr. Antonio Gargiulo, Trustee
         Uruguay 385
         Buenos Aires


SASPI S.A.: Liquidates Assets to Pay Debts
------------------------------------------
Mar del Plata-based Saspi S.A. will begin liquidating its assets
following the bankruptcy pronouncement issued by Court No. 9 of
the city's civil and commercial tribunal, reports Infobae.

The ruling places the Company under the supervision of court-
appointed trustee, Mr. Mario Miguel Padin. Mr. Padin will verify
creditors' proofs of claims until February 11. The validated
claims will then be presented in court as individual reports on
March 31.

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 May 13, 2005.

CONTACT: Saspi S.A.
         Colon 5786
         Mar del Plata

         Mr. Mario Miguel Padin, Trustee
         Rawson 2272
         Mar del Plata


VAGRA S.R.L.: Enters Bankruptcy on Court Orders
-----------------------------------------------
Vagra S.R.L. enters bankruptcy protection after Court No. 17 of
Buenos Aires's civil and commercial tribunal, with the
assistance of Clerk No. 33, ordered the Company's liquidation.
The order effectively transfers control of the Company's assets
to the court-appointed trustee who will supervise the
liquidation proceedings.

Infobae reports that the court selected Mr. Gustavo Horacio
Manay as trustee. He will be verifying creditors' proofs of
claims until the end of the verification phase on March 4.

Argentine bankruptcy law requires the trustee to provide the
court with individual reports on the forwarded claims and a
general report containing an audit of the Company's accounting
and business records. The individual reports will be submitted
on April 26 followed by the general report that is due on
June 15.

CONTACT: Vagra S.R.L.
         Yerbal 2429
         Buenos Aires

         Mr. Gustavo Horacio Manay, Trustee
         Montevideo 666
         Buenos Aires



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

BANCO INDUSVAL: S&P Assigns 'B' Rating; Stable Outlook
------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' global scale
foreign currency and local currency long-term counterparty
credit ratings to Banco Indusval S.A. (Indusval). The outlook is
stable.

The ratings assigned to Indusval reflect the following factors:
the intrinsic risks of operations of a small bank focused on
middle-market operations and with a limited funding base; the
intrinsic challenges of a small bank in a volatile environment
like Brazil; and the bank's low efficiency ratio due to its high
funding and structural costs compared to its revenues. "In a
medium- and long-term horizon, the ratings also consider higher
competition in the middle-market segment," said Standard &
Poor's credit analyst Claudio Gallina. These ratings risk
factors are partially offset by Indusval's strategy as a niche
bank, as well as by its good track record regarding its credit
quality, which is supported by the bank's expertise in the use
of receivables as guarantees and by the experience of its
professionals.

One of the main challenges for Indusval is the search and
maintenance of a steady funding base. Like other midsize and
small banks that operate in the Brazilian market, Indusval
suffered certain redemptions in its deposit base last November
and December. This was basically due to the apprehension
generated in the market after the intervention of the Brazilian
Central Bank in Banco Santos, which led depositors, in the great
majority institutional investors, to withdraw deposits of small
and midsize banks. In Indusval's specific case, the deposits'
reduction was partially attenuated by its improved liquidity
position (liquid assets corresponded to 46% of the bank's total
assets at September 2004) and by its capitalization situation
(asset-weighted risk ratio of 33%), which was due to the sale of
its consumer credit operations to HSBC in Brazil in September
2004 and to the bank's depositor-base diversification.

The main reasons for Indusval's success are its agility in
making decisions and its deep knowledge of the middle-market
segment. The institution operates as a niche bank, focused on
middle-market companies with operations backed by receivables.
With 124 employees in the bank (and 69 in the bank's brokerage
house) and operations concentrated basically in the state of Sao
Paulo, Indusval registered total assets of Brazilian reais (BrR)
772 million ($270 million) as of September 2004.

The stable outlook on both local currency and foreign currency
ratings assigned to Indusval incorporates our expectation that
the deposit redemptions verified in November and December of
this year will significantly reduce and that the institution
will maintain its asset-quality ratio (nonperforming loans)
lower than 3% and its liquidity ratio (liquid assets to total
assets) at around 35%. The stable outlook also incorporates an
improvement in the bank's efficiency ratio from 2005-when its
numbers will not reveal the influence of its consumer finance
business anymore.

The stable outlook could be changed to negative or ratings could
be lowered if there is a significant deterioration in Indusval's
asset quality ratios (vis-a-vis its current levels), if
deposits' redemptions become a problem for the bank's liquidity,
or if the bank is unable to gradually improve its efficiency
ratio.


BRASKEM: Details Plans to Pay Interest on Capital
-------------------------------------------------
Braskem S.A. ("Braskem"), supplementary to the relevant fact
announcement published on December 17, 2004, hereby informs
shareholders and the market of the following:

          Payment Of Interest On Own Capital

As the Shareholders have already been informed, the Board of
Directors met on December 14, 2004 and authorized payment to
Braskem shareholders of up to R$ 170,000,000.00 (one hundred and
seventy million Brazilian reais) in interest attributable to
shareholders' equity; it delegated the decision on the exact
amount to be credited to the shareholders to the executive
board, within the limit set by the board of directors in
relation to the amount to be determined at the end of the
financial year 2004, pursuant to the legal and statutory limits
and rules of the Company and imputing said amount to the
priority obligatory dividends for the financial year 2004, under
the terms of Law no. 9.249/95 and paragraph 6 of Article 44 of
the Company's by-laws.

Therefore at the meeting held on this date, the Board of
Directors decided:

1. to pay the shareholders interest attributable to
shareholders' equity, as determined for the base date of
December 31, 2004, in the total gross amount of
R$170,000,000.00, of which:

a) R$136,023,953.75 for holders of "A" and "B" class preferred
shares and holders of American Depositary Receipts ("ADRs"),
which corresponds to the gross amount of R$2.255638 per one
thousand shares and per ADR (each ADR traded on the New York
Stock Exchange - NYSE: BAK - corresponds to 1,000 class
"A" preferred shares); and

b) R$33,976,046.25 for holders of common stock, which
corresponds to the gross amount of R$1,124475 per one thousand
shares.

2. that the corresponding credit in the accounting records of
Braskem will be made on December 31, 2004, individually for each
shareholder on the basis of the stock position on this same
date;

3. that payment will be made within 60 days of the Ordinary
General Meeting due to be held in 2005, on the basis of the
stock position on December 31, 2004, and shares traded on the
stock exchanges "ex" of this interest on own capital as of
January 3, 2005, which will be taken as "Brazilian Record Date"
to fulfill obligations under the ADR program maintained by
Braskem in the United States of America.

As legally required, payment of interests will be made net of
income tax which will be withheld at source at the rate of 15%
under Law no. 9.249/95, except for corporate or legal entity
shareholders that show that they are exempt or immune under the
provisions of Law no. 9.532/97, or for publicly quoted or
closely held supplementary pension entities, insurance companies
or scheduled individual retirement fund managers that have
adhered to the Special Taxation Regime pursuant to Provisional
Measure no. 2.222/01 and Law no. 10.431/02.

Any shareholders resident or domiciled in a country that does
not tax this income or taxes it at a rate of less than twenty
percent (20%), as mentioned in Art. 24 of Law 9.430/96, are
subject to income tax withheld at source at the rate of twenty-
five percent (25%).

As share registrar for Braskem stock, Banco Itau S.A will send
shareholders notification of the credit and payment referred to
above and will be at the service of shareholders to clarify any
questions at Shareholder Assistance positions in its branches
located at the addresses below:

- Rua Boa Vista, 176 - 1§ subsolo - Sao Paulo-SP;
- Rua Sete de Setembro, 99 - subsolo - Rio de Janeiro-RJ;
- Av. Joao Pinheiro, 195 - terreo - Belo Horizonte-MG;
- Rua Sete de Setembro, 746 - terreo - Porto Alegre-RS;
- Rua Joao Negrao, 65 - sobreloja - Curitiba-PR;
- Av. Estados Unidos, 50 - 2§ andar - Salvador-BA;
- SCS Quadra 3 - Edificio D'Angela - sobreloja - Brasilia-DF.

CONTACT: Braskem S.A.
         Av. Nacoes Unidas
         4777 Cep
         San Paulo, 05477-000
         Brazil
         Phone: 55-11-3443-9999
         Website: http://www.braskem.com.br/


CEMIG: Explains Obligatory Exchange of Debentures
------------------------------------------------
Companhia Energetica de Minas Gerais - Cemig, a listed Company
holding public service concessions, with shares traded on the
stock exchanges of Sao Paulo, New York and Madrid, in accordance
with its commitment to implement best corporate governance
practices, hereby informs the public, in accordance with CVM
Instructions 358 of 3 January 2002 and 359 of 22 January 2002,
that as authorized by the General Meeting of Holders of the
Company's First Issue of Non-convertible Debentures, in the
amount of R$ 625,000,000.00, the "Second Amendment to the
Private Deed of the First Public Issue of Non-Convertible
Debentures Divided into Two Series, Without Guarantee nor
Preference of Companhia Energetica de Minas Gerais - Cemig"
("the Second Amendment") has been signed, providing for the
obligatory exchange of the Company's First Issue of Debentures
for debentures to be issued by the new Company of the Cemig
group that will be responsible for electricity generation and
transmission, for the purpose of implementing the process of
"unbundling" (de-verticalization) of the Company required by Law
10848 of 15 March 2004.

The public is hereby notified that the Second Amendment is
available for consultation by investors on the following web
pages:

http://www.cemig.com.br
http://www.planner.com.br
http://www.cetip.com.br
http://www.bovespa.com.br

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


CESP: To Issue New Shares, Debentures This Year
-----------------------------------------------
As part of an effort to alleviate its financial hardship,
Brazilian electric power generation firm Companhia Energetica de
Sao Paulo SA (CESP) will issue new shares and debentures this
year, Dow Jones Newswires reports.

CESP Finance Director Vicente Okasaki said the capital increase
should take place by April.

The capital increase is part of an April 2004 agreement between
CESP's controlling shareholder, the Sao Paulo state government,
and Brazil's National Development Bank, or BNDES. CESP secured a
BRL1.2 billion ($1=BRL2.69) loan from BNDES in exchange for a
capital injection by the state government of at least 10% of the
loan value, part of which may be paid in assets, Okasaki said.
The government plans to allow CESP's minority shareholders to
participate as well, he added.

The BNDES loan covered CESP's debts with Brazil's federal
government through May 2005, and the firm is also planning to
issue BRL1 billion of debentures convertible into shares to help
meet other commitments, Okasaki said.

Also, CESP has some US$120 million of eurobonds rolled over from
last year that come due in May, and Okasaki said he wants to
issue new eurobonds to replace them, as current favorable market
conditions should mean lower costs.

The Company inherited some US$4.6 billion of debts following the
privatization of other electric power and natural gas assets
held by the Sao Paulo state government. The debts remain CESP's
biggest challenge, as spending is minimal and limited to US$30
million per year for operations and maintenance, he said.

"CESP has no more investments, it's just maintenance," Okasaki
said. "The concern now is to pay the debt."

CONTACT:    Companhia Energetica De Sao Paulo
            Rua da ConsolaO o, 1.875
            CEP 01301 -100 S o Paulo, Brazil
            Phone: +55-11-234-6322
            Fax: +55-11-287-0871
            Home Page: http://www.CESP.com.br/
            Contact:
            Mauro G. Jardim Arce, Chairman
            Ruy M. Altenfelder Silva, Vice Chairman
            Vicente Kazuhiro Okazaki, Finance Director


CFLCL: Final Tune-Up Begins For Ivan Botelho III
------------------------------------------------
In the next days the new hydroelectric Ivan Botelho III will be
adding its power to the Companhia Forca e Luz Cataguazes-
Leopoldina (CFLCL) distribution system, as soon as it begins
commercial operations after ending the remaining adjustments of
the power plant machines.

The Ivan Botelho III SHP will operate with two Kaplan S Montante
turbines (24.4 MW). It's one of a three-part hydroelectric
complex built by Cat-Leo Energia S/A and located on the Pomba
River, surrounded by the municipalities of Guarani, Astolfo
Dutra and Pirauba in the Tropical Forest Region (Zona da Mata)
of Minas Gerais, totaling 60.8 MW.

CONTACT: Mauricio Perez Botelho
         Investor Relations Director
         Companhia Forca e Luz Cataguazes-Leopoldina
         Praca Rui Barbosa, 80 - CEP 36770-901
         Cataguases, MG
         Phone: (32) 3429-6282
         Fax: (32) 3429-6480
         E-mail: mbotelho@cataguazes.com.br


GERDAU: Expands Operations to Colombia
--------------------------------------
The Gerdau Group is expanding its international operations into
yet another South American country: Colombia. The Group signed
an agreement to become a shareholder of the companies Diaco S.A.
and Siderurgica del Pacifico S.A. - Sidelpa, in a scheduled
acquisition process of the stakes of the Mayaguez Group and the
Latinamerican Enterprise Steel Holding, which together hold
majority control of the companies.

The companies were formed as a result of the consolidation
process that occurred in the sector in Colombia. The annual
revenue of the two companies together totals US$ 180 million,
and they sell approximately 400 thousand metric tons of steel,
numbers that guarantee a market participation of 45%. The
companies employ nearly 1,000 people and are focused primarily
on the domestic market. Sidelpa exports only a small volume of
specialty steel to the United States.

The transaction involves two steel mills, a profile and rebar
mill located in the city of Tuta, and Sidelpa, a specialty steel
mill located in the city of Cali. The units operate in the long
steel segment, which is also the market focus of the Gerdau
Group. The Tuta mill is owned by Diaco and services the civil
construction and industry sectors, while the Sidelpa is focused
on the automotive sector. Furthermore, the productive process of
the steel mills is fundamentally the same as that of the Gerdau
Group long steel mills, using electric furnaces and steel scrap
as the primary raw material.

Three rolling mills are also involved in the venture: Muna, Cali
and Laminados Andinos - Lasa (located in the Boyaca District),
all Diaco units. The transaction also included a fabricated
reinforcing steel facility in the city of Bogot . Together, the
operations have an annual installed capacity of 460 thousand
metric tons of steel and 605 thousand metric tons of rolled
products.

"The investment in Colombia reinforces our strategy of growth on
the American continent," said Jorge Gerdau Johannpeter,
president of the Gerdau Group. "The country has one of the most
promising markets in South America."

The Mayaguez Group will remain a shareholder of Diaco for a
period of up to eight years. With the alliance, Diaco and its
subsidiaries will have access to technical assistance, state-of-
the-art technology, a distribution consulting service and Gerdau
Group corporate practices in order to achieve high performance
levels in the production and sale of steel.

The steelmaking sector in Colombia

Colombia produced approximately 700 thousand tons of steel in
2004 according to an estimate published by the Latin American
Iron and Steel Institute (Instituto Latino-Americano de Ferro e
A‡o - Ilafa). The demand in the country, however, is higher than
the local production, resulting in a deficit of nearly one
million metric tons that must be imported. Furthermore, the per
capita steel demand is one of the lowest in Latin America - 56
kilos per inhabitant -, meaning that the market has a potential
for growth in upcoming years. In Brazil, for example, each
inhabitant consumes approximately 105 kilos of steel. In the
United States, this figure rises to 401 kilos per inhabitant.

The largest long steel producer in the Americas

The Gerdau Group is the largest long steel producer in the
Americas, with 26 steel mills located in Brazil, Argentina,
Canada, Chile, the United States and Uruguay. During the first
nine months of this year, the Group produced 10 million metric
tons of steel and recorded sales of R$ 17.6 billion and a net
income of R$ 2.5 billion. The Group has shares listed on the
stock exchanges of Brazil, the United States, Canada and Spain
(Latibex). It is one of the largest recyclers of the Americas,
reusing nearly 11 million metric tons of scrap per year.

CONTACT: Gerdau S.A.
         Avenida Farrapos 1811
         Porto Alerge, RS 90220-005
         Brazil
         Phone: +55 3323 2000
         Web site: http://www.gerdau.com.br


TCP: Announces Results of Jan. 4 Public Auction
-----------------------------------------------
Telesp Celular Participacoes S.A. ("TCP"), (NYSE: TCP; BOVESPA:
TSPP3 (Common), TSPP4 (Preferred)), made an announcement Tuesday
that:

(i) the total number of common shares (ON) and preferred shares
(PN) subscribed for during the public auction held on January 4,
2005 at the Sao Paulo Stock Exchange (BOVESPA), where the shares
were subscribed for at a minimum price R$ 5.00 to a maximum
price of R$ 6.96 per thousand shares; and

(ii) the total number of shares subscribed in the initial
preemptive rights exercise period, the two re-offering rounds
and the public auction.

To view tables:
http://bankrupt.com/misc/TelespA.htm

The Company also announced that on January 7, 2005, a special
meeting of the Board of Directors will take place to ratify the
capital increase.

To view table:
http://bankrupt.com/misc/TelespB.htm

CONTACT: VIVO - Investor Relations
         Phone: +55 11 5105-1172
         E-mail: ir@vivo.com.br
         Web Site: http://www.vivo.com.br



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

EDELNOR: S&P Issues Report on Ratings
-------------------------------------

Rationale
The ratings on Empresa Electrica del Norte Grande S.A. (Edelnor)
(B/Stable/--) reflect a weak financial profile partly offset by
Edelnor's diversified generation base, ownership of transmission
assets (a competitive advantage), and its 21% equity stake in
the Gasoducto Norandino pipeline, which provides a stable cash
flow stream.

Edelnor operates in the Northern Interconnected System (SING),
where about 40% of the nearly 2,600 MW of installed generation
depends on natural gas (considering dispatch restrictions to
natural gas-fired units). The need to burn coal or fuel oil as a
result of natural gas supply shortages to gas-fired power plants
and the system's oversupply when natural gas is available (peak
demand reached 1,428 MW in 2003) subjects Edelnor to spot-price
volatility, which affects about 50% to 60% of its revenues.

The Chilean electric system faces high natural gas supply risk
from Argentina, where a rate freeze in peso terms for regulated
gas customers combined with a strong increase in demand have
distorted prices and caused a mismatch between gas supply and
demand. This situation has already resulted in supply
interruptions to both Argentine and Chilean customers during
2004. Natural gas shortages in the SING reached levels of about
3.5 million cubic meters (m3) per day in May 2004, from a total
consumption of about 6.5 million m3 per day (including about 1.2
million m3 per day consumed by the Termoandes power plant in
Argentina and exported to Chile as power). Standard & Poor's
expects that in the event of large natural gas shortages in the
SING, Edelnor's relatively large, coal-fired power generation
capacity (341 MW) will enable it to meet its relatively low
level of contracted sales and sell about 100 MW to 200 MW at
high prices in the spot market. However, in that scenario,
Edelnor will have to serve its "ship-or-pay" agreements for
natural gas transportation with the Norandino pipeline and will
face lower margins from its sales under contracts. The Company
should be able to offset those costs by selling part of its
coal-fired capacity at high prices in the spot market. The
overall effect will depend on the levels of electricity prices
in the spot market; the higher, the better for Edelnor. In this
case, Standard & Poor's considers Edelnor's diverse power
generation base (47% coal and 35% natural gas and marginally
diesel oil, fuel oil, and hydro power) a competitive advantage,
because it grants higher supply reliability than its highly gas-
fired peers.

Edelnor's financial profile remains weak even after the debt
reorganization in 2002 that substantially improved its debt and
maturity profile. Interest coverage increased during 2003, as
Edelnor's adjusted funds from operations (FFO; including cash
flows from its 21%-owned Norandino pipeline) covered 3.4x
interest. However, at 8.7% of average debt, adjusted FFO debt
coverage remains relatively weak in light of Edelnor's volatile
cash generation. Standard & Poor's expects a positive trend (for
the 12-months ended September 2004, these ratios reached 4.3x
and 11.9%) until 2006, when the interest burden will increase
according to the terms of the 2002 debt renegotiation. The
financing cost of the $217 million Novation Loan Agreement will
gradually increase to 8.5% in November 2012, from 4% in November
2005, and Edelnor will have to amortize about $22 million in
capital per year from 2008. Thus, adjusted FFO interest coverage
should decrease to levels of about 2.5x, while adjusted FFO to
total average debt should remain at about 10% from 2006 to 2009.

Edelnor is a partially integrated utility, mainly operating in
power generation and, to a lesser extent, transmission in
northern Chile. The Company owns and operates generation
facilities that have a total capacity of 688 MW, leases another
29 MW of diesel units, and commercializes 3 MW of a hydraulic
plant. Edelnor also owns about 1,056 km of transmission lines.
The Company is 82.34%-owned by Inversiones Mejillones S.A., a
holding Company owned by Belgium's Suez - Tractebel S.A. and
Chilean copper producer Corporacion Nacional del Cobre de Chile
(foreign currency A/Stable/--; local currency A+/Stable/--).

Liquidity
Edelnor has an adequate liquidity position due to its long-term
and smooth debt-maturity profile and low investment needs, but
has weak financial flexibility. As of Sept. 30, 2004, the
Company had $30 million in cash and short-term investments, and
$4.6 million in short-term financial debt (mainly accrued
interests). Edelnor completed a Chapter 11 reorganization on
Nov. 5, 2002, which replaced $340 million in bank debt with $217
million, 15-year debt certificates, and a $46 million
subordinated shareholder loan. The new debt certificates carry a
4% coupon during the first three years (with step-up rates from
November 2005 and reaching levels of 8.5% from November 2012)
and amortize in 20 semiannual, $10.9 million equal installments
starting May 5, 2008. Edelnor's limited financial flexibility
results from its weak, but improved, financial profile and
certain restrictions on incurring additional debt according to
the terms of the Company's preexisting debt. Edelnor is also
obliged to maintain a minimum liquidity level of $15 million,
although this amount decreases to $4 million when considering a
$11 million credit line granted by parent Inversiones
Mejillones. Standard & Poor's does not expect Edelnor to carry
out significant capital expenditures or distribute sizable
dividends in the next five years. The Company is in compliance
with its financial covenants.

Outlook
The stable outlook incorporates Standard & Poor's expectations
that Edelnor will be able to offset the effect of potential
natural gas shortages to its natural gas-fired units by selling
its noncontracted, coal-fired capacity at high prices in the
spot market. Therefore, projected debt and interest coverage
ratios should not be affected by natural gas supply shortages in
the SING. If the effect of the crisis is significant, however,
Standard & Poor's could revise its ratings. Nevertheless,
ratings could be revised upward if the Company's financial
ratios improve despite natural gas shortages and if the Company
recovers access to the financial markets before its financial
debt comes due in May 2008.

Primary Credit Analyst: Sergio Fuentes, Buenos Aires (54) 114-
891-2131; sergio_fuentes@standardandpoors.com


ENAMI: Expects Up to $70M Profit This Year
------------------------------------------
Chile's state minerals Company Enami expects to see up to US$70
million in profit this year after it pays off US$450 million in
debt, Business News Americas reports, citing Enami executive VP
Jaime Perez de Arce.

Enami expects to pay the debt using the US$393 million that
state copper Company Codelco has agreed to pay for the
320,000t/y Ventanas smelter-refinery. Codelco is still
evaluating how to finance the Ventanas purchase and the
transaction is not likely to be completed before the end of
April.

Payment of the remainder of Enami's debt would come from other
Company income, such as cash flow from operations, according to
mining minister Alonso Dulanto.

Enami is forecast to make a profit of some US$6 million in 2004,
according to Perez de Arce. This would be the first time the
state Company has turned a profit in several years.



=====================
E L   S A L V A D O R
=====================

BANCO SALVADORENO: S&P Releases Report on Ratings
-------------------------------------------------

CREDIT RATING:                            BB/Stable/B

Outstanding Rating(s):
  Counterparty Credit                     BB/Stable/B
Certificate of deposit
  Local currency                          BB/B

Major Rating Factors

Strengths:
    * Satisfactory market position
    * Adequate performance and diversified loan portfolio
    * Lower exposure to real state loans than peers

Weaknesses:
    * Large portfolio of nonperforming assets (NPAs)
    * Flexible loan renegotiation and nonconservative reserve
      coverage policy toward NPAs
    * Small Salvadorian economy with low growth prospects

Rationale
The ratings on Banco Salvadoreno S.A. are supported by its
satisfactory market position, diversified portfolio, adequate
performance, and lower exposure to real state-related loans than
peers. Offsetting factors include lower asset quality
fundamentals characterized by flexible restructuring standards
and low reserve coverage of NPAs, as is also the case of other
banks in the country.

Banco Salvadoreno's loan portfolio is diversified by type and
industry. As growth has been slow in El Salvador, its has slowed
down the bank's credit expansion, particularly in the commercial
segment. To compensate that, the bank has focused on increasing
its consumer business. In Standard & Poor's Ratings Services'
view, slow loan growth will continue as the market is relatively
mature and the economy is expected to expand moderately. Asset
quality is regarded as vulnerable due to the bank's flexible
practices of restructuring problematic loans, the risk of
operating in a relatively small and undiversified economy, and
the shortage of provisions to fully cover loans that have proven
problematic. Although historically the bank has reported
adequate indicators of nonperforming loans (NPLs), the
increasing balance of gross problematic assets conformed by
NPLs, restructured loans, and repossessed assets reached 12.5%
of total loans at September 2004. Nevertheless, Banco
Salvadoreno has a lower exposure to real estate-related loans,
including mortgages and construction loans, which we view as
riskier than commercial loans.

We maintain our concern regarding Banco Salvadoreno's reserve
shortage to fully cover potential losses related to the
significant balance of NPAs. In this context, although reserves
fully covered delinquent loans, this ratio weakens to 25% if
restructured loans are included. We have observed the
continuation of flexible loan restructuring practices without
adequate coverage in the largest banks of the system, and we
consider it a weakness of the banking industry. Under market
turmoil, asset quality could be pressured further, affecting
profitability and operational performance.

Although Banco Salvadoreno faces important competition, mainly
from the two largest banks in the country-Banco AgrĄcola and
Banco Cuscatl n-it has been able to maintain its position as the
third-largest commercial bank in El Salvador with a 17% market
share in terms of deposits and loans. Nevertheless, Banco de
Comercio's acquisition by Scotiabank at the end of November 2004
is going to intensify competition in the market and will reduce
the market share gap between them.

Profitability is adequate for the rating level and has been
sustained-despite decreasing net interest margins-by increasing
fees and commissions; however, it remains lower than that of its
closest peers. A more conservative policy toward provisioning
the balance of problematic assets would result in lower
profitability levels. Internally generated funds have been
sufficient to cover high-dividend payouts and have supported
capital growth to comply with increasing regulatory
capitalization levels. Nevertheless, considering the shortage of
reserves to completely cover NPAs, we consider that capital is
modest. Currently, reserves required to reach an adequate level
of reserve coverage would consume around half of equity.

Outlook
The outlook reflects our opinion that the bank's strategies and
adequate operations should maintain profitability at adequate
levels in a stable economic environment. An economic downturn or
the continuation of low growing prospects of the Salvadorian
economy, however, could affect the bank's overall performance,
putting pressure on the ratings. Ratings could go up if there is
a strong development in economic conditions, along with a
sustainable improvement in asset quality (including restructured
loans and repossessed assets) and profitability, and if capital
ratios are higher than those of its closest peers.

Primary Credit Analyst: Leonardo Bravo, Mexico City (52)55-5081-
4406; leonardo_bravo@standardandpoors.com

Secondary Credit Analyst: Angelica Bala, Mexico City (52) 55-
5081-4405; angelica_bala@standardandpoors.com



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

TV AZTECA: SEC Charges Company, Chairman With Fraudulent Scheme
---------------------------------------------------------------
The Securities and Exchange Commission filed Tuesday civil fraud
charges against TV Azteca S.A. de C.V. (TV Azteca or the
Company), a Mexican issuer whose American depository receipts
trade on the NYSE, its parent Company, Azteca Holdings, S.A., de
C.V. (Azteca Holdings), and three current and former TV Azteca
officers and directors, Ricardo Salinas Pliego, Pedro Padilla
Longoria, and Luis Echarte Fernandez.  The SEC alleges in its
complaint that the defendants engaged in an elaborate scheme to
conceal Salinas's role in a series of transactions through which
he personally profited by $109 million.  The SEC complaint also
alleges that Salinas and Padilla sold millions of dollars of TV
Azteca stock while Salinas's self-dealing remained undisclosed
to the market place.

In its action, the SEC is seeking injunctions from future
securities law violations, civil money penalties, and
disgorgement of Salinas' and Padilla's ill-gotten gains, plus
prejudgment interest.  The SEC also is seeking court-orders
barring Salinas and Padilla from serving as officers or
directors of any publicly-held Company with securities trading
in the United States.

Spencer C. Barasch, head of enforcement for the SEC's Fort Worth
office, commented, "Enhanced global cooperation among securities
regulators has significantly changed the ways in which the SEC
investigates and prosecutes conduct that crosses international
borders.  The cooperative efforts in this case of the SEC and
the Comisi˘n Nacional Bancaria y de Valores in Mexico are a
testament to the efficiency and effectiveness of collaborative
international enforcement.  Securities regulators share a strong
and mutual resolve to combat fraud; geographic boundaries will
not serve to protect those who seek to defraud investors." The
SEC and CNBV are parties to a bilateral memorandum of
understanding as well as to the International Organization of
Securities Commissions multilateral memorandum of understanding,
both of which significantly facilitate information sharing.

The SEC's complaint names the following entities and individuals
as defendants.

TV Azteca, a Mexican corporation headquartered in Mexico City,
is the second largest television broadcasting Company in Mexico.
TV Azteca's American depository receipts are listed on the New
York Stock Exchange. The Company's underlying ordinary
participation certificates trade on the Bolsa Mexicana de
Valores, the Mexican stock exchange.

Azteca Holdings, a Mexican holding Company headquartered in
Mexico City, beneficially owns 55% of the outstanding stock of
TV Azteca.  Azteca Holdings is indirectly owned and controlled
by the Salinas family.  Azteca Holdings' debt securities trade
on the U.S. Over-the-Counter Bulletin Board Market.

Salinas, age 49 and a Mexican citizen, has been the chairman of
the board of directors and the controlling shareholder of TV
Azteca since 1993.  Salinas also has been chairman of the board,
CEO and president of Azteca Holdings since 1997.

Padilla, age 38 and a Mexican citizen, has been a director of TV
Azteca since 1993, and was the CEO of the Company from October
2001 through July 2004, when he was named CEO of Grupo Salinas,
a de facto holding Company for various Salinas controlled
entities.

Echarte, age 59 and a U.S. citizen, has been a director of TV
Azteca since 1999.  Echarte is also the president and CEO of
Azteca America, a TV Azteca subsidiary based in New York, and is
the chief financial strategist for Grupo Salinas.

According to the SEC complaint, Salinas and others caused TV
Azteca or Azteca Holdings to file periodic reports that did not
disclose Salinas's involvement in related party transactions
between Unefon, a subsidiary of TV Azteca, and a private entity
secretly co-owned by Salinas, called Codisco.  In the related
party transactions, Salinas purchased from a third party-at a
steep discount-approximately $325 million of indebtedness owed
by Unefon to the third party.  At the time that Salinas
purchased the indebtedness, he was aware that Unefon was in
negotiations with another large telecom company which would
provide substantial cash to Unefon, and enable Unefon to pay off
the full amount of the indebtedness that Salinas had purchased
at a discount.  Only three months later, when Unefon closed the
deal with the other telecom company, Salinas profited by $109
million upon Unefon's repayment of the debt at full value.

TV Azteca filed the false reports with the SEC, concealing
Salinas' involvement in the Unefon debt transactions, despite
receiving advice from its U.S. counsel that these transactions
were material, reportable transactions under U.S. federal
securities laws.  While the Company provided general disclosure
of the transactions, it refused to reveal information crucial to
investors: that Salinas was behind the transactions and
personally profited from them.  TV Azteca's resistance led to
the eventual resignation of its U.S. counsel, who told the
Company's board of directors and management that it was
resigning consistent with its obligations under Section 307 of
the Sarbanes-Oxley Act.

In various filings and public statements from June 2003 through
January 2004, TV Azteca and its management discussed publicly
the Unefon debt transactions while either failing to disclose
Salinas's involvement, or, in several instances, falsely denying
Salinas's involvement.  For example, Salinas publicly denied any
connection to Codisco in response to a query by the press
regarding market concern that he may have been affiliated with
Codisco. TV Azteca's U.S. legal counsel subsequently discovered
the news article containing Salinas's false denial and advised
Padilla that corrective disclosure was necessary. Despite the
falsity of the statement, and the advice of counsel, the
defendants did nothing to correct Salinas's false denial.
Further, in communications with TV Azteca's independent
directors, Salinas, Padilla and Echarte intentionally withheld
information from, and even lied to the directors about Salinas's
connection to the underlying transactions and his $109 million
profit.  Salinas and Padilla compounded their fraud by executing
false Sarbanes-Oxley certifications.

After the resignation of TV Azteca's U.S. legal counsel and a
Dec. 24, 2003, New York Times article concerning the matter,
Echarte sent an email to Salinas and Padilla, stating, "The
damage is done and the situation that we didn't want to explain
openly is now in the hands of the public."  Shortly thereafter,
on Jan. 9, 2004, TV Azteca issued a press release confirming
that Salinas indirectly owned half of Codisco.

The SEC alleges in its complaint that the defendants violated or
aided and abetted violations of the antifraud, reporting,
concealment from auditors, books and records, internal controls,
beneficial interest disclosure and Sarbanes-Oxley certification
provisions of the federal securities laws.

In a consent filed simultaneously with the complaint, Echarte
settled the SEC's action against him by agreeing, without
admitting or denying the complaint's allegations, to the entry
of a final judgment permanently enjoining him from violating,
and aiding and abetting violations of the antifraud, reporting,
books and records, and internal controls provisions of the
federal securities laws.  Echarte also has agreed to pay a civil
penalty of $200,000 and disgorgement of $1.

FOR FURTHER INFORMATION CONTACT:

- Harold F. Degenhardt, District Administrator, (817) 900-2607
- Spencer C. Barasch, Associate District Administrator, (817)
978-6425
- Jeffrey Cohen, Assistant District Administrator, (817) 978-
6480

Fort Worth Office
Securities and Exchange Commission

CONTACT: TV AZTECA
         Periferico Sur
         No. 4121
         Col., Fuentes del Pedregal
         14141 D.F.
         Mexico
         Phone: 52-5-420-1313



=============
U R U G U A Y
=============

UTE: To Import More Power From Brazil Says President
----------------------------------------------------
Uruguay's state power provider UTE will have to import more
power from Brazil to make up for low hydro generation this
summer, according to UTE president Ricardo Scaglia.

Business News Americas reveals that UTE's Salto Grande hydro
plant receives water from the Uruguay river basin, but its
reservoir is 1.7m below its normal level for this time of year.
The low water level means the flow at Salto Grande is only 1,000
cubic meters a second (m3/s) instead of 2,300m3/s, which is
normal for January.

"We are receiving 50% less [water] compared to other summers,"
Salto Grande officials said.

The plant is only generating about 8,300MWh currently compared
to 12,000MWh at this time last year. According to the officials,
the situation is unlikely to improve in the short-term due to
the low probability of rainfall in the region, and could worsen.

UTE aims to "import as much as it can" and "use the least amount
of water possible" to try and make it through the summer without
power cuts, UTE director Juan Gabito said.



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

PDVSA: Largest Labor Group Snubs New Labor Contract
---------------------------------------------------
Venezuela's largest labor group is seeking to nullify a new
collective labor contract reached between state oil producer
Petroleos de Venezuela and oil unions, Fedepetrol, Sinutrapetrol
and Fetrahidrocarburos.

The Venezuelan Workers Confederation, which claims its member
unions represent 1 million workers in the South American
country, rejected the new contract, citing insufficient pay
raises.

The raises "don't adapt to the levels of inflation," Froilan
Barrios, secretary of the labor group.

But Fedepetrol Director Rafael Barrios deemed the group's
criticism as a "political" action due to the Workers
Confederation's opposition to President Hugo Chavez's
government.

He said the union, which represents some 7,000 state oil Company
employees, had hoped for a 50% raise but had settled for less in
the interests of obtaining better benefits.

The new labor agreement benefits 44,000 state and sub-contracted
oil workers who will see their daily salaries increase to
VEB32,000 from VEB24,000 on average.



                            ***********


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

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