TCRLA_Public/060330.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, March 30, 2006, Vol. 7, Issue 64

                            Headlines

A N T I G U A   &   B A R B U D A

DIGICEL LIMITED: Launching Antiguan Network Tomorrow

A R G E N T I N A

AEROLINEAS ARGENTINAS: Adds MD 83 Series Plane to Its Fleet
BANCO PATAGONIA: Set Sights on 54% Boost in Private Sector Loans
MACRO BANSUD: Posts US$89 Million Gain in ADR Issue
TARJETA NARANJA: Fitch Puts Low-B Curr. Issuer Default Ratings
TRANSMEDIC S.A.: Proofs of Claim Verification Ends May 15

VIVIENDAS TRABAJADORES: Presents Validated Claims on Aug. 22

* ARGENTINA: Chile Wants Fuel Swap Mechanisms Broadened

B E R M U D A

ENDURANCE SPECIALTY: Names M. Fujii to Head Global Insurance
SEA CONTAINERS: Withdraws from Ferry Business
SEA CONTAINERS: S&P Downgrades Corporate Credit Rating to CCC+

B O L I V I A

REPSOL YPF: Santa Cruz Court Lifts Bail of Andina Executives

* BOLIVIA: President Morales Bashes at Colombia & Peru Over FTA

B R A Z I L

BANCO PACTUAL: Creates New Financial Services Division
CSN: Expects Flat Steel Consumption to Rise 10% in 2006
CVRD: Paying BRL4,490,591 Premium on Shareholder Debentures

C A Y M A N   I S L A N D S

MARBLE EAGLE: Sets April 6 Proofs of Claim Filing Deadline
MAYFLOWER 747-98: Stops Accepting Proofs of Claim
METROPOLITAN CAPITAL: Sets Apr. 10 Deadline for Filing of Claims
MILLENNIUM SHOPPING: Creditors Must File Claims by April 6
TORUS (HY) I: Sets April 6 Proofs of Claim Filing Deadline

TORUS (HY-JAPAN): Creditors Claim Filing Deadline Is April 6

C O L O M B I A

* COLOMBIA: Establishing Micro-Lending Bank for Small Businesses

C O S T A   R I C A

* COSTA RICA: Economy Rises Due to Foreign Investments

D O M I N I C A N   R E P U B L I C

AES CORP: Environmental Damage Suit Seen as Test Case

E C U A D O R

* ECUADOR: Poll Shows Free Trade Deal with U.S. Is Unpopular
* ECUADOR: State of Emergency in Effect in Four Provinces

E L   S A L V A D O R

* EL SALVADOR: Gets U.S. Congress Approval to Join CAFTA

H O N D U R A S

* HONDURAS: Congress Approves CAFTA with United States

J A M A I C A

DIGICEL: Names Magnus Johansson as Wireless Broadband Director

* JAMAICA: Borrows US$19.5M from Venezuela for Ocho Rios Highway

M E X I C O

SATMEX: Supervisor Has 30 Days to Finish Debt Restructuring Plan

N I C A R A G U A

HILTON HOTELS: Enters Nicaragua under Princess Hotels Name

P A N A M A

* PANAMA: Wants Ties with Venezuela Strengthened

P E R U

* PERU: Congress May Ratify Free Trade Accord with U.S. in June

P U E R T O   R I C O

MUSICLAND HOLDING: Inks Stipulation on Services Pact with Deluxe
MUSICLAND HOLDING: Verizon Wants Service Contract Decision Now
OCA INC: Court Approves $15 Mil. DIP Revolving Credit Financing

U R U G U A Y

* URUGUAY: AFAP Lobbies for Gov't to Allow Overseas Investments

V E N E Z U E L A

* VENEZUELA: Government May Not Impose Ban on US' Airlines
* VENEZUELA: Panama Seeks Better Economic Ties with Country
* VENEZUELA: World Bank Approves US$200 Million in Loans


                            - - - - -

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


DIGICEL LIMITED: Launching Antiguan Network Tomorrow
----------------------------------------------------
Digicel LImited will be launching its network services in the
twin islands of Antigua and Barbuda, according to the
TeleGeography online edition.

Digicel acquired the GSM operating licence last year from
Cingular Wireless, as part of that group's decision to sell off
non-core assets.

Antigua opened its telecommunication market to other players
after being criticized internationally for being non-
competitive.  Cable & Wireless holds the monopoly on
international telecommunications services.

Information, Broadcasting and Telecommunications Minister Edmond
Mansoor claims the government has been working closely with
Cable & Wireless towards its goal of liberalizing the industry.
He said that tlaks are 'very fruitful.'  According to Minister
Mansoor, Cable and Wireless' monopoly could be ended as soon as
the end of 2006, some six years before it is contractually due,
the TeleGeography relates.

Digicel Limited is a wireless services provider in the Caribbean
region founded in 2000, and controlled by Denis O'Brien.  The
company started operations in Jamaica in April 2001 and now
offers GSM mobile services in 13 countries of the Caribbean
including Jamaica, St. Lucia, St. Vincent, Aruba, Grenada,
Barbados, Cayman, and Curacao among others.  Digicel finished
FY2005 with 1.722 million total subscribers -- 97% pre-paid --
estimated market share of 67% and revenues and EBITDA of US$478
million and US$155 million, respectively.

                        *    *    *

As reported on Mar. 10, 2006, Fitch affirmed the 'B' rating of
Digicel Limited, senior unsecured debt, including the US$300
million senior notes due 2012, following the announcement that
it is in the process of acquiring Bouygues Telecom Caraibe.
Fitch said the Outlook for the Ratings is Stable.

Based on the terms of the agreement, the acquisition is expected
to be entirely funded with additional senior debt and will
moderately increase leverage and subordination to the senior
note holders.  Better than expected operating cash flow and
EBITDA performance during the fiscal year, support the
incremental debt leverage, which should remain consistent with
the current rating category.  Any material changes to terms of
the acquisition could affect that rating level.

Fitch continues to expect improvements in financial leverage
over the next few years, although any additional future
acquisitions funded with debt could weaken the company's credit
quality.

The acquisition of BTC will improve the geographic
diversification, its revenue base, and moderately increase
operating EBITDA.  Proforma to the acquisition, Digicel's fiscal
year 2007 aka FY2007 hard currency revenue mix is also expected
to increase.


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


AEROLINEAS ARGENTINAS: Adds MD 83 Series Plane to Its Fleet
-----------------------------------------------------------
Aerolineas Argentinas/Austral Group incorporated an MD 83 series
plane to the fleet of Austral Lineas Aereas within the equipment
renewal increase and unification plan for plane model.

The MD/83 -- registered as LV-BEG -- is the fourteenth of its
type that joins the Mc Donnell Douglas planes that forms part of
Austral park.

The plane came from Phoenix, Arizona, USA.  Following a complete
checking type C, it will operate domestic and regional routes
since its range allows it.

The MD series 80 is configured for 140 passengers in economy
class and 8 in exclusive, being its flight range 4,800
kilometers.

In this way the Aerolineas/Austral Group continues incorporating
new units to its fleet with the clear intention of go on being
leader in the Argentine Air commercial market.

                        *    *    *

As reported by Troubled Company Reporter on June 15, 2000,
Aerolineas Argentinas needed a $650 million capital injection
and sweeping cost cuts to save it from bankruptcy.  Aerolineas'
biggest shareholder covered a bulk of its losses, which Spanish
sources put at $300 million in 2000.

                        *    *    *

Aerolineas Argentinas defaulted on a US$50 million bonds due on
December 23, 2003.


BANCO PATAGONIA: Set Sights on 54% Boost in Private Sector Loans
----------------------------------------------------------------
Argentina's Banco Patagonia plans to increase loans to private
sector by 54% this year from the ARS1.87 billion it lent in
2005, the bank said in a statement.

Business News Americas reports that the loan portfolio last year
increased 41%, mainly because of a 41% boost in lending to the
private sector.

Banco Patagonia, according to the press release, will continue
to analyze a listing on the Buenos Aires stock exchange,
although the bank had already disclosed a plan to list its
shares on the Merval index within two years.  The strong 2005
profits could speed up the decision to the end of 2006 or at the
start of 2007.

Due to better financial margins and higher net service income,
Banco Patagonia's profits soared 158% to ARS235 million in 2005,
Business News relates.  Deposits were up 27% to ARS2.65 billion
while assets arrived at the total of ARS4.22 billion at the end
of 2005.  Equity, on the other hand, was ARS827 million.

Banco Patagonia commands a 2.2% market share in the loan market
of Argentina, Business News reports.

                        *    *    *

On Dec. 12, 2005, Moody's Latin America Calificadora de Riesgo
S.A. reaffirmed the 'BB' rating on US$80 million worth of bonds
issued by Banco Patagonia S.A. (f.k.a. Banco Patagonia Sudameris
SA), the CNV revealed in its Web site.

The undated bonds were described as "Serie 3 Oblig Negociables"
and are classified under "Series and/or Class."

The rating reflects the bank's financial status as of Sep. 30,
2005.  A "BB" rating indicates that the future of these bonds
cannot be well assured.


MACRO BANSUD: Posts US$89 Million Gain in ADR Issue
---------------------------------------------------
Banco Macro Bansud posted on Friday earnings of US$89 million
from the issuance of 9,718,281 American Depositary Shares aka
ADS, the bank said in a statement.

According to Business News, the bank started trading in the New
York Stock Exchange on Friday, using the ticker symbol BMA.
Each ADS -- offered at a price of US$20.35 -- represents 10
class B shares.

Macro Bansud told Business News that proceeds from the offering
-- approximately US$88,538,954 -- will be used for general
corporate purposes.

Business News states that market players said the fresh funds
will aid Macro Bansud in financing its probable purchase of
local bank Nuevo Banco Bisel.  As reported by the Troubled
Company Reporter on March 27, 2006, Macro Bansud -- along with
six other companies -- acquired bidding rules for Banco Bisel's
auction on March 28, 2006.

                       *    *    *

On Dec. 13, 2005, Moody's Investors Service affirmed the credit
ratings of Banco Macro Bansud S.A. following the latter's
announcement that it has acquired the 75% stake in
Banco del Tucuman S.A. from Banco Comafi S.A. for US$17.3
million.

In affirming Macro's ratings, Moody's said that the acquisition,
which is pending regulatory approval, does not change the bank's
risk or business profile.

Macro announced on November 9 it was taking over selected assets
and liabilities of Banco Empresario de Tucuman, worth
approximately US$35.8 million, which included eight branches in
the Province of Tucuman. These acquisitions should grant the
Macro group a dominant position in the province.

Banco Macro Bansud S.A. is headquartered in Buenos Aires,
Argentina. As of June 2005, the bank's total assets were US$2.4
billion.

The following ratings of Banco Macro Bansud S.A. were affirmed:

    -- Bank Financial Strength Rating: E -- Positive Outlook
    -- Long- Term Global Local Currency Deposits: Ba3
    -- Short -Term Global Local Currency Deposits: Not Prime
    -- National Scale Rating for Local Currency Deposits: Aa2.ar
    -- Long -Term Foreign Currency Deposits: Caa1
    -- Short -Term Foreign Currency Deposits: Not Prime
    -- National Scale Rating for Foreign Currency Deposits:
       Ba1.ar.


TARJETA NARANJA: Fitch Puts Low-B Curr. Issuer Default Ratings
--------------------------------------------------------------
Fitch Ratings has assigned long- and short-term local currency
Issuer Default Ratings of 'B-' and 'B', respectively, to Tarjeta
Naranja SA. The Rating Outlook assigned to the long-term IDR is
Stable.  Fitch expects to assign a Long-term local currency
rating of 'B-' and Recovery Ratings of 'RR4' to TN's US$50
million class II unsubordinated fixed-rate notes.  TN has a
National long-term rating of 'A+(arg)' and National short-term
rating of 'A1(arg)' by Fitch.  The Outlook on the National long-
term rating is Stable.

TN's ratings reflect its sound profitability, liquidity, and
asset quality, as well as its satisfactory capital base.  They
also take into account the still relatively weak, albeit
improving, operating environment.  The ratings of TN's notes
will reflect the international ratings assigned to TN.  While
the notes are denominated in US dollars, the issue will carry a
local currency IDR as the issue is effectively converted to a
peso amount at issue date, and the dollar amount to be paid at
each of the four amortization dates is determined by the
peso/dollar exchange rate then in effect, transferring the
potential exchange risk to the holder of the notes.  In
addition, should the issuer not be able to obtain the dollars
needed due to external reasons at any payment date, it is
allowed to pay the correspondent amount in pesos converted at
the above mentioned exchange rate.

The Argentine economy has significantly improved since the 2002
crisis (GDP growth of around 9% per annum in the past three
years) and this has resulted in a better operating environment
for banks, with growing deposits and lending, especially
consumer loans.  TN's good profitability is based on strong
revenue generation, adequate cost efficiency, and a healthy
asset quality.  However, its net income declined in 2005 as a
consequence of higher administrative expenses due to the
company's expansion and a legal limit on fees and interest rates
imposed on credit card issuers in 2005.  Fitch expects TN's
profitability to remain sound based on its good revenue
generation and growth.

TN's lending has grown significantly since the crisis (up 48% in
2005). As its asset quality ratios have historically been very
good based on conservative credit limits and good scoring
systems, Fitch expects TN's asset quality to remain healthy in
spite of strong loan growth. Its nonperforming loans (NPL) to
total loans ratio was a low 2.8% at end-2005 with loan loss
reserve coverage of 103%.  Large write-offs in 2002, sound
recoveries procedures, and a better economic situation have led
to a significant decline in NPLs (2002: about 22%).

TN's liquidity is strong, supported by the short-term nature of
its lending.  In addition, it is extending the maturity of its
funding by issuing debt and securitizing loans.  Exposure to
foreign currency risk is low as most of its debt is in pesos.
TN's US$50 million class II unsubordinated fixed-rate notes are
payable in pesos at the exchange rate of the final offering day.
In addition, unlike most financial institutions in Argentina, TN
did not hold any government bonds at end-2005.

TN's capital base is ample with an equity/assets ratio of 21.1%
at end-2005.  In spite of the significant growth of its assets,
the company's strong internal capital generation allowed it to
return to its shareholders in December 2005 the ARP25 million
capital injection done in 2004 to restore the company's capital
base damaged by the 2002 losses. As from 2005, TN plans to pay
out around 25% of net income.

TN was created in 1985 in the Province of Cordoba and since 1996
has expanded geographically through the merger with Tarjetas del
Sur and Tarjeta Comfiar and its 100% owned Tarjeta del Mar,
currently operating in most of the country.  At end-2005 TN had
78% of the credit card market in Cordoba and was the third
largest card issuer nationally. TN is 80% owned by Banco de
Galicia y Buenos Aires or Banco Galicia, the second largest bank
in Argentina by assets.

Fitch's National Ratings provide a relative measure of
creditworthiness for rated entities in countries where the
sovereign's foreign and local currency ratings are below 'AAA'.
National ratings are not internationally comparable since the
best relative risk within a country is rated 'AAA' and other
credits are rated only relative to this risk.  They are
signified by the addition of an identifier, for the country
concerned, such as 'AAA (arg)' for national ratings in
Argentina.


TRANSMEDIC S.A.: Proofs of Claim Verification Ends May 15
---------------------------------------------------------
Jorge Jalfin, court-appointed trustee, has started verifying
claims against Transmedic S.A., Argentine daily La Nacion
reports.  The verification will end on May 15, 2006.

La Nacion relates that Buenos Aires' Court No. 16 declared the
company's bankruptcy in favor of Jose Grinspen, the company's
creditor.

Clerk No. 32 assists the court in this case.

The debtor can be reached at:

         Transmedic S.A.
         Mariscal Sucre 2281
         Buenos Aires, Argentina

The trustee can be reached at:

         Jorge Jalfin
         Sarmiento 1452
         Buenos Aires, Argentina


VIVIENDAS TRABAJADORES: Presents Validated Claims on Aug. 22
------------------------------------------------------------
The presentation of validated claims against Viviendas
Trabajadores de las Universidades Nacionales IV A is scheduled
on Aug. 22, 2006, Infobae reports.

The company was declared bankrupt by a Buenos Aires court after
it defaulted on its debt payments.  Infobae did not disclose the
name of the court-appointed trustee.

A general report on the company's bankruptcy case is expected on
Oct. 3, 2006.


* ARGENTINA: Chile Wants Fuel Swap Mechanisms Broadened
-------------------------------------------------------
Patricia San Juan, writing for Dow Jones Newswires, reports that
Chile and Argentina seek to broaden the fuel swap mechanisms
some companies have undertaken to offset Argentina's reduced
natural gas exports that have hurt Chilean power generators.

"(Argentine Planning) Minister De Vido and I talked about how we
can go about designing new swap mechanisms that would benefit
both countries," Chilean Mining and Energy Minister Karen
Poniachik told reporters.

Chilean generator, Endesa SA, managed to counter the gas cuts
after signing pacts to swap fuel for gas with Argentine
companies.

Chile has been hurt by reductions of natural gas supplies from
Argentina, which is facing rising demand locally.

Because of the gas supply cuts, Chile's generators were forced
to use more expensive fuels causing energy costs to balloon.

Power producers, however, reaped the benefits of heavy rainfall
in 2005, which has allowed them to make up for gas cuts through
cheaper hydroelectric generation and ensure medium-term energy
supply.

The government has made the energy sector as one of its top
priorities and aims to diversify the country's energy supply.
Part of the administration's plan is to build plants utilizing
liquefied natural gas.

Additionally, the government seeks to boost regional energy
initiatives, such as a proposed energy-integration project that
could deliver natural gas from Peru or Bolivia, Dow Jones
relates.

                        *    *    *

Fitch Ratings assigns these ratings on Argentina:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     RD      Dec. 14, 2005
   Long Term IDR       B       Dec. 14, 2005
   Short Term IDR      B-      Jun.  3, 2005
   Local Currency
   Long Term Issuer
   Default Rating      B       Jun.  3, 2005


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


ENDURANCE SPECIALTY: Names M. Fujii to Head Global Insurance
------------------------------------------------------------
Endurance Specialty Holdings Ltd. (NYSE:ENH), a global provider
of property and casualty insurance and reinsurance, appoints
Michael Fujii to the position of Chief Operating Officer -
Insurance.  Mr. Fujii, the current head of Endurance's U.S.
insurance business, will also become responsible for Endurance's
Bermuda and U.K. insurance operations.

Mr. Fujii joined Endurance in October 2004.  Prior to joining
Endurance, Mr. Fujii was employed by Great American Custom
Insurance Services, where he most recently served as President
and CEO.  Prior to that, Mr. Fujii was President of CIGNA E&S
from 1987 to 1992.  A graduate of Loyola University-Los Angeles,
Mr. Fujii is a member of the AICPA and the California Institute
of Certified Public Accountants.  Mr. Fujii also sits on the
board of the Insurance Institute's Charitable Foundation.

Kenneth J. LeStrange, Chairman, President and Chief Executive
Officer, commented, "During his tenure at Endurance, Mike has
demonstrated his effective leadership and insurance acumen.
This promotion will enable Mike to bring his considerable skills
to a broader segment of Endurance's portfolio of insurance
business lines."

Endurance Specialty Holdings Ltd. -- http://www.endurance.bm/
-- is a global provider of property and casualty insurance and
reinsurance.  Through its operating subsidiaries, Endurance
currently writes property per risk treaty reinsurance, property
catastrophe reinsurance, casualty treaty reinsurance, property
individual risks, casualty individual risks, and other specialty
lines.  Endurance's headquarters are located at Wellesley House,
90 Pitts Bay Road, Pembroke HM 08, Bermuda and its mailing
address is Endurance Specialty Holdings Ltd., Suite No. 784, No.
48 Par-la-Ville Road, Hamilton HM 11, Bermuda.

                        *    *    *

As reported on Jan. 31, 2006, Standard & Poor's Ratings Services
assigned its preliminary 'BBB' senior debt, 'BBB-' subordinated
debt, 'BB+' junior subordinated, and 'BB+' preferred stock
ratings to Endurance Specialty Holdings Ltd.'s (NYSE:ENH;
BBB/Positive/--) recently filed universal shelf.  The new shelf
has an undesignated notional amount in accordance with the new
SEC rules effective Dec. 1, 2005.

"The ratings reflect the company's strong competitive position,
which is supported by a diversified business platform,"
explained Standard & Poor's credit analyst Damien Magarelli.  In
addition, ENH maintains strong capital adequacy and strong
operating performance.  "Offsetting these positive factors are
concerns about exposure to catastrophes and ENH being a
relatively new operation and management not having been tested
through difficult market cycles while at the company," added Mr.
Magarelli.  Also, ENH has expanded its product offering via new
transactions and it remains unclear if these new transactions
will yield strong earnings.

ENH has strong financial flexibility and debt leverage, and
interest coverage levels are well above that required for the
rating.  Also, ENH's diversified platform and strong earnings
support nonstandard notching.  ENH is expected to maintain debt
leverage of less than 20% and interest coverage of more than 10x
in support of nonstandard notching.  ENH had a debt-to-capital
ratio of 17.7% in 2004 and interest coverage significantly more
than the level required for the rating at 35x.

The outlook is based on Standard & Poor's expectation that ENH
will maintain strong earnings in 2006. Standard & Poor's also
expects that the group's capital adequacy ratio will remain
strong at more than 155%.  In addition, the company is expected
to exhibit the risk-management skills and underwriting
discipline to control the volume and profitability of business.
ENH is expected to maintain debt leverage at less than 20% and
interest coverage of more than 10x in support of nonstandard
notching.

If ENH maintains strong earnings in 2006, the rating could be
raised.  In contrast, if hurricane loss estimates are revised
significantly upward, if capital expectations are not met, or if
strong earnings are not maintained, the outlook could be revised
to stable.


SEA CONTAINERS: Withdraws from Ferry Business
---------------------------------------------
Sea Containers Ltd (NYSE: SCRA and SCRB) disclosed that it will
withdraw completely from the ferry business.  The decision,
together with other matters, will result in a total impairment
charge of approximately $500 million in the fourth quarter of
2005.

Sea Containers reported on Nov. 3, 2005, that it had begun a
process of restructuring its ferry division, and that it would
be entertaining offers to buy the core business of Helsinki-
based Silja Oy Ab, which includes eight vessels operating on
three routes in the Baltic.

The Company also announced its intention to sell or charter out
several additional ferry vessels and to entertain offers to buy
its SeaStreak business in New York.  Because of the
restructuring, the Company announced an impairment charge of $99
million, of which $19 million was recorded in the 2005 third
quarter results.

At the meeting of the Board on March 20, 2006, management's
proposals relating to these ferry and container matters were
approved.  The Company will recognize a non-cash pre-tax charge
of approximately $500 million in the fourth quarter 2005, which
includes the previously estimated fourth quarter 2005 impairment
charge of $112 million reported in the November announcement.
Of this approximate $500 million, approximately $415 million
relates to the ferry business, and approximately $85 million
relates to the container business.

Robert MacKenzie, President and Chief Executive of Sea
Containers, said, "The additional write-downs announced today
reflect decisions made by the Sea Containers Board following a
rigorous management-driven process of analyzing the Company's
businesses, in the light of changing market conditions, recent
trading performance and with a focus on future sustainable cash
flows.  Our objective is to reduce the central cost structure
and direct management attention on the core independent
businesses of marine container leasing, including GE SeaCo, and
our GNER rail franchise.  The Board will continue to review
opportunities for the disposal of its non-core activities.

"We are in dialogue with the Company's banks in order to amend
or waive compliance with covenants. Management has been
encouraged by the initial response from these institutions to
work with us to resolve these matters.

"At a commercial level there is progress. Silja's core business
has attracted a range of highly qualified bidders with the
second round of bids due shortly.  Indications are that a sale
of the core business can be completed in the second quarter,
with the sale of most or all of the remaining ferry assets
contemplated during the course of the year.

"The filing of the Company's 2005 Form 10-K annual report with
the U.S. Securities and Exchange Commission will be delayed into
April in order to allow adequate time to resolve the various
bank covenant issues and finalize outstanding accounting
matters.  The report will be filed as soon as practicable," he
concluded.

Sea Containers, Ltd. -- http://www.seacontainers.com-- provides
passenger and freight transport and marine container leasing.
It operates in four segments: Ferry, Rail, Container, and
Leisure.

                        *    *    *

As reported in the Troubled Company Reporter on March 28, 2006,
Standard & Poor's Ratings Services lowered its ratings on Sea
Containers Ltd., including lowering the corporate credit rating
to 'CCC+' from 'B+'.  S&P retained all ratings on CreditWatch
with negative implications. The ratings were initially placed on
CreditWatch on Aug. 25, 2005, and subsequently lowered to the
'B+' level on Feb. 16, 2006.

"The downgrade is based on heightened uncertainty regarding
continued debt service after management stated that it was
evaluating 'all options' for Sea Containers' financial
structure," said S&P's credit analyst Betsy Snyder.

As reported in the Troubled Company Reporter on March 27, 2006,
Moody's Investors Service placed all ratings of Sea Containers
Ltd., under review for possible downgrade -- senior unsecured
rating at B3.  The review was prompted by the company's
disclosure that it would not file its Form 10-K until it
completes the testing of asset impairments, as well as the
uncertainty surrounding the timing of the proposed sale of Silja
Oy Ab and the other ferry assets.


SEA CONTAINERS: S&P Downgrades Corporate Credit Rating to CCC+
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Sea
Containers Ltd., including lowering the corporate credit rating
to 'CCC+' from 'B+'.  All ratings remain on CreditWatch with
negative implications; ratings were initially placed on
CreditWatch on Aug. 25, 2005, and subsequently lowered to the
'B+' level on Feb. 16, 2006.

The company has hired financial advisors and is evaluating an
appropriate financial structure for the company.  The company
also announced that it will exit its ferry businesses
completely, which will result in a non-cash, pretax impairment
charge of approximately $500 million to be taken in the fourth
quarter of 2005, significantly higher than the previously
expected $138 million.  The charge will reduce Sea Containers'
net worth by approximately $475 million, and result in
noncompliance with certain net worth covenants in certain of its
bank agreements.  Sea Containers is currently in discussions
with the bank lenders regarding covenant waivers or amendments.
As a result, its 2005 10-K financial filing will be delayed to
allow adequate time to resolve the bank covenant issues and
finalize accounting matters.

"The downgrade is based on heightened uncertainty regarding
continued debt service after management stated that it was
evaluating 'all options' for Sea Containers' financial
structure," said Standard & Poor's credit analyst Betsy Snyder.
"Although Sea Containers currently has $250 million to $300
million of cash, and expects proceeds from sales of the ferry
operations sufficient to pay off associated debt, cash flow from
the company's continuing operations [GNER, its U.K. railroad
franchise, and its marine cargo container leasing business]
could prove insufficient to service remaining debt," the analyst
continued.

If the company were to default on debt payments or to undertake
an exchange of existing debt that Standard & Poor's considered
to be a distressed exchange, ratings would be lowered to 'D' or
'SD' (selective default).

Ratings reflect a relatively weak financial profile, even after
the planned divestiture of Sea Containers' unprofitable ferry
operations, expected to occur in 2006.  However, the company
does benefit from fairly strong competitive positions in its two
major remaining businesses:

   * GNER (Great North Eastern Railway, a passenger rail line
     between London and Scotland); and

   * marine cargo container leasing.

Sale of the Silja assets, which account for approximately 75% of
the ferry assets, is expected to occur in the second quarter of
2006, with the second round of bids due shortly.  The timing and
proceeds from sale of the other ferry assets are more uncertain,
although their sale is expected to occur by the end of 2006.

Standard & Poor's will monitor:

   * the potential financial restructuring of the company;

   * progress on the sale of the ferry operations;

   * progress on waivers or amendments on the covenants in the
     bank facilities; and

   * resolution of the arbitration with General Electric to
     resolve the CreditWatch.


=============
B O L I V I A
=============


REPSOL YPF: Santa Cruz Court Lifts Bail of Andina Executives
------------------------------------------------------------
The judge in a Santa Cruz court ruled to lift the US$100,000
bail imposed on Julio Gavito -- former president of Repsol YPF's
Bolivarian operations and vice president of subsidiary Petrolera
Andina -- and Pedro Sanchez, Andina's operations manager.

The court also ruled to loosen travel restrictions on Messrs.
Gavito and Sanchez.  They have been allowed to travel out of the
country, but with prior permission, as they still have to appear
in court once a month.

Messrs. Gavito and Sanchez are facing allegations on forgery of
customs documentations and illegal exportation of about 230,000
barrels of oil worth more than US$9.2 million to Argentina and
Chile between 2004 and 2005.

Prosecutors issued a warrant of arrest after the executives
failed to appear in a court hearing on March 9, 2006, to address
the charges.  A raid in Andina's offices followed where the
police seized documents found inside the offices.  The two
officials, however, were not found.

Three weeks after, Messrs. Gavito and Sanchez presented
themselves to the prosecutor's office and were detained after
testifying for six hours.  They were later released on bail.

Mr. Gavito resigned in the midst of the investigation to
dedicate part of his time to the defense of the company's work
and its collaborators.

Luis Garcia Sanchez, the LPG Andina president in Peru, was
appointed to replace Mr. Gavito, effective March 23.

Mr. Sanchez, on the other hand, remained in Andina.

The prosecutors decided not to file an appeal on the court's
ruling on lifting the bail.

                        *    *    *

On June 20, 2005, Moody's Investors Service upgraded the ratings
of Spanish-Argentine oil company Repsol YPF's local subsidiary
YPF S.A. Moody's upgraded YPF's senior unsecured rating to Ba3
from B1 and the unit's domestic currency issuer rating to Baa2
from Baa3.

YPF's foreign currency issuer rating of Caa1 remained unchanged,
as it is constrained by the sovereign ceiling of Argentina.
YPF's Corporate Family Rating (formerly known as the senior
implied rating) is aligned with the foreign currency issuer
rating at Caa1.


* BOLIVIA: President Morales Bashes at Colombia & Peru Over FTA
---------------------------------------------------------------
Bolivian President Evo Morales said that Colombia and Peru have
undermined the Andean Community by signing Free Trade Area
agreements with the United States, Prensa Latina reports.

President Morales notes that the FTA has caused troubles like
what Ecuador is experiencing at the moment.

"Many are using false pretexts for unilateral negotiations with
the US..," Presindent Morales was quoted by Prensa Latina as
saying.  "We need a real treaty of the peoples to give markets
to the poor and the producers, generate jobs, and fight against
poverty."

The President called for an Andean Community of Nations Summit
among Colombia, Ecuador, Peru and Venezuela to prepare for the
May 12-13 meeting in Vienna, Austria, between Latin America and
Europe.  He also announced an April 19 Summit in Paraguay among
Venezuela, Uruguay and Paraguay to discuss the energy ring,
Prensa Latina reports.

                        *    *    *

Fitch Ratings assigns these ratings on Bolivia:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling    B-       Jun. 17, 2004
   Long Term IDR      B-       Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating     B-       Dec. 14, 2005


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


BANCO PACTUAL: Creates New Financial Services Division
------------------------------------------------------
Banco Pactual has set up a new financial services division
called Pactual Servicos Financeiros aka PSS to administer
pension funds, local financial daily Valor Economico reports.

Pactual executive Rodrigo Xavier told Valor Economico that PSS
will start operating with BRL1.5 billion in equity and 20
clients.

The financial daily relates that pension fund Previnor will be
the first client, with BRL420 million in equity and 3.2 million
subscribers.

Previnor, as stated by Business News Americas, is an affiliate
of firms Petroflex, Suzano, Petrorio and Polimeros and serves
workers in the petrochemicals industry and is affiliated with
firms Petroflex.

"The sector has become one of the bank's focuses," Xavier said
to Valor Economico.

PSS, however, still awaits authorization from securities
commission CVM, Valor Economico reports.

                        *    *    *

On Oct. 18, 2005, Fitch Ratings revised the Banco Pactual's
rating outlook to positive from stable.

   Banco Pactual:

      -- Long-term foreign currency 'BB-';
      -- Long-term local currency 'BB-'.

   Pactual Overseas Corporation

      -- Long-term foreign currency 'BB-'
      -- Long-term local currency 'BB-'.


CSN: Expects Flat Steel Consumption to Rise 10% in 2006
-------------------------------------------------------
CSN aka Cia Siderurgica Nacional S.A. -- a Brazilian integrated
steelmaker -- expects a 10% boost in flat steel consumption this
year, according to a statement by AARS -- a Rio Grande do Sul
state steel association.

Basing on a presentation by CSN rolled unit director Fernando
Martinez, AARS said that flat steel sales could reach 10.5Mt in
2006.  According to the association, this would represent a
recovery to 2004 levels following a rough 2005.

CSN has an installed capacity of 5.8Mt/y of crude steel.  Rio
Grande do Sul is CSN's second main market, with a 10% share
representing 300,000t/y.

CSN manufactures and distributes hot rolled, cold rolled and
galvanized steel products and tin mill products.  CSN
distributes primarily to customers in the automobile, auto-
parts, civil construction, tubes and pipes and electrical
equipment industries.  The company markets its products mainly
in Latin America, North America, Europe and Asia.

                        *    *    *

On Jan. 26, 2006, Standard's and Poor Rating Services assigned a
'BB' corporate credit rating on Brazilian flat carbon steelmaker
Companhia Siderurgica Nacional.

The 'BB' corporate credit rating on CSN reflects the company's
exposure to volatile demand and price cycles, increasing
competition in its home and predominant market of Brazil,
aggressive dividend policy and capital investment plan, and
sizable gross-debt position.  These risks are partly offset by
CSN's privileged cost position and sound operating profile,
favorable market position in Brazil, strong export capabilities
to offset occasional domestic demand sluggishness, and
increasing business diversification.

CSN is one of the lowest-cost steel producers in the world,
which is a result of its access to proprietary, high-quality
iron ore (at the Casa de Pedra mine); self-sufficiency in
energy; streamlined facilities; and logistics advantages.  This
is in addition to the group's strong market position in the
fairly concentrated steel industry in Brazil.


CVRD: Paying BRL4,490,591 Premium on Shareholder Debentures
-----------------------------------------------------------
Companhia Vale do Rio Doce aka CVRD will pay a premium on its
shareholder debentures of BRL0.011557036 per debenture,
amounting to a total of BRL4,490,591.00.

The payment is subject to withholding income taxes, with the
exception of those institutional investors who have proved
exemption from income tax.

The funds will be available from April 3, 2006, at CETIP --
Central de Custodia e de Liquidacao Financeira de Titulos -- for
those investors holding debentures registered on the SND aka
Sistema Nacional de Debentures.  For investors whose debentures
are not linked to the SND, funds will be available at Banco
Bradesco S.A.

Headquartered in Rio de Janeiro, Brazil, Companhia Vale do Rio
Doce -- http://www.cvrd.com.br/-- engages primarily in mining
and logistics businesses. It engages in iron ore mining, pellet
production, manganese ore mining, and ferroalloy production, as
well as in the production of nonferrous minerals, such as
kaolin, potash, copper, and gold.

                        *    *    *

On Jan. 5, 2006, Fitch Ratings assigned a long-term foreign
currency rating of 'BB' to Vale Overseas Limited's proposed
US$300 million issuance due 2016.  Vale Overseas is a wholly
owned subsidiary of Companhia Vale do Rio Doce, a large
diversified mining company located in Brazil.  The notes are
unsecured obligations of Vale Overseas and are unconditionally
guaranteed by CVRD.  The obligation to guarantee the notes rank
pari passu with all of CVRD's other unsecured and unsubordinated
debt obligations.  Fitch expects the proceeds of this issuance
to be used for general corporate purposes and primarily to pay
down US$300 million of Vale Overseas' 9.0% guaranteed notes due
2013.

Fitch also maintains these ratings for CVRD and CVRD Finance
Ltd., a wholly owned subsidiary of CVRD:

  -- CVRD foreign currency rating: 'BB', Outlook Positive;
  -- CVRD local currency rating: 'BBB' Outlook Stable;
  -- CVRD national scale rating: 'AAA(bra)', Outlook Stable;
  -- CVRD Finance Ltd.: series 2000-1 and series 2000-3: 'BBB';
  -- CVRD Finance Ltd., series 2000-2 and series 2003-1: 'AAA'.


===========================
C A Y M A N   I S L A N D S
===========================


MARBLE EAGLE: Sets April 6 Proofs of Claim Filing Deadline
----------------------------------------------------------
Creditors of Marble Eagle Limited, which is being voluntarily
wound up, are required on or before April 6, 2006, to present
proofs of claim to Buchanan Limited, the company's voluntary
liquidator.

Marble Eagle Limited started liquidating assets on Feb. 23,
2006.

Creditors are required to present proofs of claim personally or
through their solicitors at the time and place that the
liquidator will specify.  Failure to present claims would mean
exclusion from the benefit of any distribution that the company
will make.

The voluntary liquidator can be reached at:

            Francine Jennings
            Buchanan Limited
            P.O. Box 1170, George Town
            Grand Cayman, Cayman Islandss
            Telephone: (345) 949-0355
            Facsimile: (345) 949-0360


MAYFLOWER 747-98: Stops Accepting Proofs of Claim
-------------------------------------------------
The filing of proofs of claims against Mayflower 747-98 Limited
-- company under voluntary liquidation -- ended on March 27,
2006.  Creditors who failed to have their claims verified are
disqualified form receiving any benefit in the distribution that
the company will make.

Mayflower 747-98 Limited started liquidating assets on Feb. 27,
2006.  Griffin Management Limited was appointed as voluntary
liquidator.

The voluntary liquidator can be reached at:

            Griffin Management Limited
            Attention: Janeen Aljadir
            Caledonian Bank & Trust Limited
            Caledonian House, 69 Dr. Roy's Drive
            P.O. Box 1043, George Town
            Grand Cayman, Cayman Islands
            Telephone: (345) 949 -4943
            Facsimile: (345) 814-4859


METROPOLITAN CAPITAL: Sets Apr. 10 Deadline for Filing of Claims
----------------------------------------------------------------
Creditors of Metropolitan Capital Corporation are required to
submit particulars of their debts or claims on or before April
10, 2006, to Janet Crawshaw and Jamal Young, the company's joint
voluntary liquidators.  Failure to do so will exclude them from
receiving the benefit of any distribution that the company will
make.

Metropolitan Capital Corporation started liquidating assets on
Feb. 15, 2006.

The joint voluntary liquidators can be reached at:

      Attention: Marguerite Britton
      Janet Crawshaw
      Jamal Young
      P.O. Box 1109, George Town
      Grand Cayman, Cayman Islands
      Telephone: (345) 949-7755
      Facsimile: (345) 949-7634


MILLENNIUM SHOPPING: Creditors Must File Claims by April 6
----------------------------------------------------------
Creditors of Millennium Shopping Corp. I, which is being
voluntarily wound up, are required to present proofs of claim on
or before April 6, 2006, to Carlos Farjallah and Richard Gordon,
the company's joint voluntary liquidators.

Creditors are required to present proofs of claim personally or
through their solicitors at the time and place that the
liquidator specified.  Failure to present claims would mean
exclusion from the benefit of any distribution that the company
will make.

Millennium Shopping Corp. I started winding up operations on
Feb. 22, 2006.

The joint voluntary liquidators can be reached at:

            Carlos Farjallah and Richard Gordon
            Maples Finance Limited
            P.O. Box 1093, George Town
            Grand Cayman, Cayman Islands


TORUS (HY) I: Sets April 6 Proofs of Claim Filing Deadline
----------------------------------------------------------
Creditors of Torus (HY) I Limited are required to submit
particulars of their debts or claims on or before April 6, 2006,
to Steven O'Connor and Emile Small, the company's joint
voluntary liquidators.  Failure to do so will exclude them from
receiving the benefit of any distribution that the company will
make.

Torus (HY) I Limited started liquidating assets on Feb. 15,
2006.

The joint voluntary liquidators can be reached at:

             Steven O'Connor
             Emile Small
             Maples Finance Limited
             P.O. Box 1093, George Town
             Grand Cayman, Cayman Islands


TORUS (HY-JAPAN): Creditors Claim Filing Deadline Is April 6
------------------------------------------------------------
Creditors of Torus (HY-Japan) Limited, which is being
voluntarily wound up, are required on or before April 6, 2006,
to present proofs of claim to Steven O'Connor and Emile Small,
the company's liquidator.

Creditors must send their full names, addresses, descriptions,
the full particulars of their debts or claims and the names and
addresses of their solicitors (if any) to the liquidator.

Torus (HY-Japan) Limited entered voluntary liquidation on Feb.
15, 2006.

The liquidator can be reached at:

             Steven O'Connor
             Emile Small
             Maples Finance Limited
             P.O. Box 1093, George Town
             Grand Cayman, Cayman Islands


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


* COLOMBIA: Establishing Micro-Lending Bank for Small Businesses
----------------------------------------------------------------
The Colombian government will create a new bank that will cater
to low-income individuals and provide micro-lending to small
businesses, Dow Jones Newswires quoted Finance Minister Alberto
Carrasquilla as saying.

Banco de las Oportunidades will start operating by the end of
June.  It will be funded by proceeds from the sale of the
state's assets.  The finance minister did not say how much cash
will be injected into the new bank, Dow Jones says.

Minister Carrasquilla added that the government won't subsidize
the credits granted by the new bank.

"The poor are credible as a source of payment," Minister
Carrasquilla said.  "The behavior of the micro-loan portfolios
is even better than for the big portfolios. We Colombians don't
need alms, we need opportunities."

In a statement, the Finance Ministry's press officer said that
the new bank won't compete with private banks.  Instead, it will
grant special credit lines to existing banks to finance micro-
lending.  Through the private banks, the government "...will
seek to irrigate low income sectors with credit," the statement
said.

In areas without commercial banks, Oportunidades will open
branches to grant loans directly to micro-businesses.

The Colombian government aims to raise the number of people with
bank accounts and with access to credit.

"The new bank will increase competition in that sector, but I
don't think it will cause disarray among banks that already
developed the business," Edgar Jimenez, a stock analyst with
Promotora Bursatil, was quoted by Dow Jones as saying.  "The
customers will be the main winners."

                        *    *    *

On May 30, 2005, Fitch Ratings has affirmed Colombia's ratings
as:

      -- Long-term foreign currency 'BB';
      -- Country ceiling 'BB';
      -- Local currency 'BBB-';
      -- Short-term 'B'.

Fitch said the Rating Outlook is Stable.


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


* COSTA RICA: Economy Rises Due to Foreign Investments
------------------------------------------------------
Costa Rica has been catapulted to the highest seat of Central
America's standard of living after it attracted hundreds of
millions of dollars of investments, Los Angeles Times reports.

The country has drawn firms like Intel Corp., Hewlett-Packard
Co. and Microsoft Corp. with lower costs, educated and bilingual
workforce, political stability, fat tax incentives and
proximity, the LA Times relates.

The country, which used to depend the greater part of its
economy on farming, has focused on tech-related industries,
according to LA Times.  Costa Rica is now leveraging talent and
technology to improve its agrarian economy.

Costa Rica is taking advantage on a trend known as near-sourcing
that has American firms establishing facilities closer to home.
LA Times states that medical device makers, call centers, back-
office outsourcing and pharmaceutical companies are being put
up.

Seattle's Washington Mutual Inc. has announced that it would
move some of its loan processing jobs in Chatsworth to Costa
Rica.  Palo Alto's HP is also planning to increase its business
service workforce in Costa Rica to 3,500 workers in a span of
two years.

According to a 2005 report on outsourcing by two consulting
firms, Costa Rica comes after India and China as the most
competitive offshore destination.

Costa Rica, says LA Times, computer components have taken the
place of bananas as the nation's largest export product.  Costa
Rica now exports more software than any other country in the
Latin American region.  Information technology -- along with
medical groups -- employ about 30,000 workers in more than 300
companies.

Costa Rica's officials are banking on tech-related exports and
services, the LA Times reports.  The country aims to become the
first developed nation in Central America.

There are obstacles, however, that keep the country from
reaching its goal.  Mark Minevich -- co-chair of the BTM
Institute, a technology think tank based in Stamford, and one of
the authors of the outsourcing report -- told the LA Times that
among those obstacles, the most obvious is Costa Rica's lack of
skilled workers needed in the growing number of businesses in
the country.

Mr. Minevich said to the LA Times that Costa Rica is comparable
to Singapore -- a small, tech-savvy nation that uses the
workforce of bigger countries such as Malaysia and Indonesia to
provide much of the workforce for major projects.

"The strategy for [Costa Rica] is to do joint ventures," LA
Times quoted Mr. Minevich saying.

                        *    *    *

As reported in the Troubled Company Reporter on Mar. 10, 2006,
Fitch rates Costa Rica's foreign and local currency issuer
default ratings 'BB' and 'BB+', respectively.  Fitch said the
Rating Outlook is Negative.

Fitch said that while the victory of Oscar Arias in Costa Rica's
recent presidential elections bodes well for reforms, the narrow
victory margin could affect the pace of reforms.

Contrary to pre-election polls in which Mr. Arias was leading by
several percentage points, he won only by a very narrow margin.
President Arias is viewed to be in favor of the US-Central
American Free Trade Agreement aka CAFTA and is pro-fiscal reform
and pro-private enterprise, but a weaker election mandate could
undermine his ability to spearhead reforms.

"As the PLN -- the party of President Arias -- has failed to
obtain a simple majority in Congress, it remains to be seen how
quickly the new administration will be able to garner sufficient
support in a divided Congress to enact crucial reforms," said
Shelly Shetty, Senior Director in Fitch's Sovereign Group in New
York.

Fitch believes that the newly elected Arias administration needs
to make headway in CAFTA and fiscal reforms in order to place
the country on a higher growth trajectory.

Although the fiscal reform has passed the first vote in the
legislative assembly, it is unclear whether it would be passed
before the next administration takes over in May.  Fiscal reform
entailing revenue-raising measures is necessary to improve the
medium-term outlook for the Costa Rican public finances.

Although Fitch recognizes the recent reduction in Costa Rica's
fiscal deficit, it believes that a permanent reduction in the
general government deficit would require a revenue-enhancing
reform.

Inflation in Costa Rica ended at 14% last year, which is among
the highest in the Latin American region.  Additional tax
revenues are needed to recapitalize the central bank in order to
improve the effectiveness of monetary policy.  The central
bank's much lauded goal of moving toward a more flexible
exchange rate regime and reversing the widespread financial
dollarization could only be achieved after a fiscal reform is
passed.

Fitch also notes that Costa Rica is the only Central American
country that has not yet approved CAFTA in its Congress.

"Approval of CAFTA is critical to further strengthen Costa
Rica's position as a leading destination for foreign direct
investment flows in the Central American region.  It is hoped
that the new government uses its political honeymoon period to
seek a speedy approval of CAFTA," said Shetty.

Although the Pacheco government submitted CAFTA in Congress last
year, the approval of this crucial trade pact has not been easy
to obtain because of opposition from the unions and some
political parties.  The treaty will not only provide Costa Rica
with the opportunity to gain permanent access to the US market,
but it will also indirectly benefit private businesses in Costa
Rica, as the treaty requires the liberalization of state-
dominated telecom and insurance sectors.

Costa Rica's economy has experienced relatively high growth in
the past few years.  Benefiting from a favorable external
backdrop and robust tourism flows, the economy is estimated to
have grown at 4% in 2005.  However, the approval of CAFTA along
with fiscal reforms could make higher growth more sustainable.

In the coming months, Fitch will assess the ability of the Arias
administration to push through reforms in Congress.  Continued
fiscal restraint, passage of a tax-enhancing package and/or
implementation of CAFTA could help in stabilizing Costa Rica's
ratings.


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


AES CORP: Environmental Damage Suit Seen as Test Case
-----------------------------------------------------
Dr. Max Puig, the Dominican Republic's Minister of Environment,
told the Bahama Journal, that his government's environmental
damage lawsuit filed against AES Corp. has every possibility of
succeeding.

As previously reported, the Dominican Republic is seeking US$80
million in damages from AES for 82,000 tons of coal ash dumped
on its beaches.  The government has said that the tons of ash
were left on the beaches in Manzanillo and the Samana Bay port
town of Arroyo Barril between October 2003 and March 2004
without proper government permits.  These tons of ash were
transported from an AES Plant in Guayama, Puerto Rico.

AES Corp. has confirmed that the ash originated at its plant.
However, it said that it did nothing improper and that the
dispute is between the Dominican government and a Florida
businessman Roger Charles Fina, chief executive officer of
Silverspot Enterprises, who was hired by AES to transport the
ash.

"For a long time people have been asking us to act, but we
didn't want to be too hasty and decided to do all the necessary
evaluations," Minister Puig has said in the same article.  "If
we have taken this step it is because we are certain that the
suit we have started has all the possibilities of coming though
successfully. Now, all the evidence and documentation that the
lawyers have will be considered, and the start date of the trial
will be set."

                      Setting An Example

Dr. Puig believes that the most important aspect of the case is
setting a precedence in suing an American company for violating
American laws outside the United States' territory.

Dr. Puig informed the Bahama Journal that Trinidad and Tobago
has already approached the Dominican Republic's government on
how to proceed with similar cases.

Trinidad is the main supplier of liquefied natural gas to the
United States.

"The US Federal law establishes that when a (company) generates
waste, (that waste) is (the company's) responsibility until it
disappears. What the legal representatives have established is
that this company violated the US federal laws in proceeding to
get rid of the waste produced by creating phantom companies and
hiding their responsibility," Dr. Puig has charged in the same
report.

AES Vice President of Communications Robin Pence told the
Journal that "the allegations are false, and the claims have no
merit."

"We will defend the company vigorously against the allegations,"
Ms. Pence said.

AES Corporation -- http://www.aes.com/-- is a global power
company.  The Company operates in South America, Europe, Africa,
Asia and the Caribbean countries.  Generating 44,000 megawatts
of electricity through 124 power facilities, the Company
delivers electricity through 15 distribution companies.

                         *     *     *

As reported in the Troubled Company Reporter on Jan. 11, 2006,
Moody's affirmed the ratings of The AES Corporation, including
its Ba3 Corporate Family Rating and the B1 rating on its senior
unsecured debt.  Moody's said the rating outlook remains stable.


=============
E C U A D O R
=============


* ECUADOR: Poll Shows Free Trade Deal with U.S. Is Unpopular
------------------------------------------------------------
A survey conducted by Cedatos Gallup Internacional Company in
Sierra, Amazonia and Costa cities, showed that 65% of the
respondents reject or don't know about the Free Trade Agreement
that Ecuador is negotiating with the United States, Prensa
Latina reports.

Many people want more information on the proposed deal.

A separate poll conducted by Datanalisis showed that 62.40% of
the respondents believe that the agreement is destructive for
the nation.

As previously reported, protests from indigenous groups erupted
as a result of FTA talks between the two countries.  Protesters
alleged that the FTA will undermine rural workers and disrupt
the country's culture.

But President Alfredo Palacio is determined to continue trade
talks and overcome obstacles over agricultural issues.

                        *    *    *

Fitch Ratings assigns these ratings on Ecuador:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     B-      Aug. 29, 2005
   Long Term IDR       B-      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005


* ECUADOR: State of Emergency in Effect in Four Provinces
---------------------------------------------------------
Ecuador has declared a state-of-emergency in four provinces to
curb protests by the Confederation of Indigenous Nationalities
of Ecuador, the nation's largest Indian movement, against a
proposed free trade deal with the United States.

Protesters alleged that under an FTA, Ecuadorean farmers and
small-scale Indian producers would not be able to compete with
cheap imports from the U.S., where agriculture is heavily
subsidized.

Under the declaration, police and military personnel can make
warrantless arrests against those participating in unauthorize
public assemblies in the Chimborazo, Cotopaxi, Imbrabura and
Canar provinces as well as the towns of Tabacundo and Cayambe.

Interior Minister Felipe Vega told reporters that the measure
has been taken by President Alfredo Palacio "to guarantee the
free flow of goods and persons (and) permit citizens the right
to work."

"We must find a way through this difficult situation we find
ourselves in," Mr. Vega has said.

Dow Jones Newswires relates that roadblocks were paralyzing
traffic and commerce in the southern highland Chimborazo
province.   Some 10,000 people opposed to the Indian protests
marched peacefully in the provincial capital city of Riobamba,
160 kilometers (100 miles) south of Quito, demanding the
government to stop the roadblocks.

Opposition leaders said in reports that they don't want to
overthrow the government but they warned that President Palacio
was setting himself up for a fall from power by insisting on the
U.S. free trade deal, Down Jones relates.

                        *    *    *

Fitch Ratings assigns these ratings on Ecuador:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     B-      Aug. 29, 2005
   Long Term IDR       B-      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005


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


* EL SALVADOR: Gets U.S. Congress Approval to Join CAFTA
--------------------------------------------------------
El Salvador has gotten the United States' Congress' approval to
join the Central American Free Trade Agreement.

The U.S.-CAFTA promotes trade liberalization between the United
States and five Central American countries:

      -- Costa Rica,
      -- El Salvador,
      -- Guatemala,
      -- Honduras, and
      -- Nicaragua.

Modeled after the ten-year old North American Free Trade
Agreement, CAFTA is widely considered to be a stepping stone to
the larger Free Trade Area of the Americas that would encompass
34 economies.

                        *    *    *

Fitch Ratings assigns these ratings on El Salvador:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     BB+      Jun. 18, 2004
   Long Term IDR       BB+      Dec. 14, 2005
   Short Term IDR      B        Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating      BB+      Dec. 14, 2005


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


* HONDURAS: Congress Approves CAFTA with United States
------------------------------------------------------
The Central American Free Trade Agreement with the United States
will take effect beginning April 1, 2006, in Honduras.

The country's legislative body approved the CAFTA with its
attached set of laws and reforms affecting 70 articles of the
Copyright Law.  The CAFTA will also impose severe penalties for
domestic and international bribery.  Over US$500 million are
hoped for in investments in 2006, the La Tribuna reports.

                        *    *    *

Moody's Investor Service assigned these ratings on Honduras:

                     Rating     Rating Date
                     ------     -----------
   Senior Unsecured    B2       Sept. 29, 1998
   Long Term IDR       B2       Sept. 29, 1998


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


DIGICEL: Names Magnus Johansson as Wireless Broadband Director
--------------------------------------------------------------
Digicel Limited has hired Magnus Johansson as director of its
wireless broadband services.  Mr. Johansson was the former
broadband unit head of Digicel's arch-rival, Cable & Wireless
Jamaica, the Nation News reports.

As wireles broadband services director, Mr. Johansson will
spearhead Digicel's J$2 billion investment program in providing
broadband access over the next 12 months, beginning April 1.

The new program will focus on network upgrade, additional
coverage and the launch of the wireless broadband solution --
WiMAX.  The company intends to roll out the latest cutting-edge
WiMAX technology as part of this process.

"I am extremely excited at the opportunity to deploy WiMax in
Jamaica, as this next generation wireless technology will
greatly enhance Jamaica's and the region's competitiveness," Mr.
Johansson told the Nation News.

Mr. Johansson believes that the WiMax will be called the second
revolution in the regional telecommunications industry,
following the one caused by the introduction of cellular
telephones.

Digicel Limited is a wireless services provider in the Caribbean
region founded in 2000, and controlled by Denis O'Brien.  The
company started operations in Jamaica in April 2001 and now
offers GSM mobile services in 13 countries of the Caribbean
including Jamaica, St. Lucia, St. Vincent, Aruba, Grenada,
Barbados, Cayman, and Curacao among others.  Digicel finished
FY2005 with 1.722 million total subscribers -- 97% pre-paid --
estimated market share of 67% and revenues and EBITDA of US$478
million and US$155 million, respectively.

                        *    *    *

As reported on Mar. 10, 2006, Fitch affirmed the 'B' rating of
Digicel Limited, senior unsecured debt, including the US$300
million senior notes due 2012, following the announcement that
it is in the process of acquiring Bouygues Telecom Caraibe.
Fitch said the Outlook for the Ratings is Stable.

Based on the terms of the agreement, the acquisition is expected
to be entirely funded with additional senior debt and will
moderately increase leverage and subordination to the senior
note holders.  Better than expected operating cash flow and
EBITDA performance during the fiscal year, support the
incremental debt leverage, which should remain consistent with
the current rating category.  Any material changes to terms of
the acquisition could affect that rating level.

Fitch continues to expect improvements in financial leverage
over the next few years, although any additional future
acquisitions funded with debt could weaken the company's credit
quality.

The acquisition of BTC will improve the geographic
diversification, its revenue base, and moderately increase
operating EBITDA.  Proforma to the acquisition, Digicel's fiscal
year 2007 aka FY2007 hard currency revenue mix is also expected
to increase.


* JAMAICA: Borrows US$19.5M from Venezuela for Ocho Rios Highway
----------------------------------------------------------------
Representatives of the Jamaican government went to Venezuela on
Thursday to sign a US$300 million (J$19.5 billion) loan.  The
fund will be used to finace the Ocho Rios leg of Highway 2000,
as well as a major island-wide road repair project, government
sources was quoted by the Jamaica Observer as saying.

According to the Observer, the loan was first discussed between
outgoing prime minister PJ Patterson and Venezuelan president
Hugo Chavez in August 2005 during the signing of the PetroCaribe
Oil Accord.

The loan, although separate from the PetroCaribe agreement
benefit, would also be at extremely low rates.  The money will
form the base for funding the Highway 2000 leg, running from
Bushy Park, St. Catherine, on the island's south coast, to Ocho
Rios, a major tourist resort, on the north shore, the Observer
says.

                        *    *    *

On Feb. 23, 2006, Moody's put its B rating on Jamaica.

"The outlook for all ratings is stable, reflecting a balance
between ongoing efforts at fiscal consolidation and the
vulnerability of the country to external shocks," Moody's said.

The agency points to Jamaica's strengths as a commitment to
fiscal discipline, proven ability to face severe shocks and
comparatively low external Government debt ratios.

Among the challenges which Jamaica faces, according to the
rating agency, is a closely managed exchange rate that is
subject to severe recurrent pressures and a large public sector
debt burden with growing exposure to international capital
markets.

The agency notes that the economy as well as the fiscal and
external positions remain sensitive to external and domestic
shocks. It further observes that, "they remain supported by the
Government's commitment to return to a balanced budget position
and by a constitutional provision mandating debt-service
payments as the first expenditure priority."

Moody's, which influences the behaviour of international
institutional investors, says despite Jamaica's recent adverse
external developments and a downturn in the local business
sentiment, "confidence in the medium-term programme and in the
ability of the policymakers has remained somewhat intact, as
evidenced by the relative stability of the foreign exchange
market, notwithstanding some bouts of pressure."


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


SATMEX: Supervisor Has 30 Days to Finish Debt Restructuring Plan
----------------------------------------------------------------
Satmex's reorganization case supervisor Thomas Heather of White
& Case law firm expects to complete the debt restructuring plan
within 30 days, Business News Americas reports.

Business News relates that Mr. Heather has been working to iron
out the details on how to implement the plan after Satmex
arrived at an agreement with its US creditors in February to
restructure its more than US$800 million debt -- of which US$523
million is in default.  Mr. Heather is working on fees, costs
and legal representation.

"A formal process is ongoing and we're trying to conclude all
the details," Mr. Heather told Business News.  "I do expect to
have a formal reorganization plan soliciting signatures from the
bondholders within the next 30 days," Heather said.

Mr. Heather revealed to Business News that the Mexican
government is on board, aiming to get a viable company in the
country and avoid any type of liquidation.

As reported by the Troubled Company Reporter on Feb. 8, 2006,
Satelites Mexicanos, S.A. de C.V., aka Satmex announced that the
principal terms of a restructuring of its indebtedness,
supported by the Conciliador appointed in its Concurso Mercantil
proceeding, were reached among the ad-hoc committees of holders
of the Senior Secured Floating Rate Notes due 2004 and the 10-
1/8% Senior Notes due 2004, the company and its shareholders.

Richard Mastoloni, vice president and treasurer of Loral and
representing Loral's interests in Satmex said, "This agreement
is the culmination of the last few years of hard work that Loral
has contributed to the restructuring of Satmex's business.
Without the need for external financing, Satmex will now be able
to launch the Space Systems/Loral-built Satmex 6 satellite, one
of the region's largest and most powerful satellites that will
provide high-demand C- and Ku-band coverage of the entire
Western hemisphere."

Specifically, the agreement provides that holders of the
existing U.S.$203.4 million of FRNs will receive new first
priority senior secured notes with a face value equal to the sum
of current principal and accrued interest through the effective
date of the restructuring in satisfaction of the obligations due
under the FRNs.

The terms proposed for the First Priority Senior Secured Notes
are as:

    -- Five year maturity with a quarterly coupon of LIBOR + 875
       basis points;

    -- Callable at a price of 103 in year 1, 102 in year 2, 101
       in year 3 and at par (plus accrued interest);

    -- First priority security interest in Satmex's assets; and

    -- Cash sweep prepayments on any cash balances over US$5
       million.

The agreement also includes the issuance of new second lien
senior notes in the principal amount of US$140,000,000 and
certain shares of reorganized Satmex to the holders of the
existing U.S.$320 million of HYBs in satisfaction of the
obligations due under the HYBs including all accrued interest.

The proposal provides for these terms for the Second Priority
Senior Secured Notes:

    -- Seven year maturity with a quarterly coupon of 10-1/8%
       all-in, with 0 percent cash payment in year 1, 2%
       cash payment  until the First Priority Senior Secured
       Notes are paid in full, after which time the coupon will
       be paid wholly in cash;

    -- Second lien on Satmex's assets junior in priority,
       operation and effect to the security interests of the
       First Priority Senior Secured Notes;

    -- After the full payment of the First Priority Senior
       Secured Notes, cash sweep prepayment on any cash balances
       over US$5 million;

    -- In exchange for capitalization of the balance of their
       claim of US$274 million in principal and unpaid interest,
       the holders of the HYBs will receive approximately 80% of
       the economic interest in the equity of Satmex including
       approximately 47% of the voting capital; and the
       shareholders agreement will include certain minority
       governance rights.

Headquartered in Mexico, Satelites Mexicanos, S.A. de C.V.
-- http://www.satmex.com/-- is the leading provider of fixed
satellite services in Mexico and is expanding its services to
become a leading provider of fixed satellite services throughout
Latin America.  Satmex provides transponder capacity to
customers for distribution of network and cable television
programming and on-site transmission of live news reports,
sporting events and other video feeds.  Satmex also provides
satellite transmission capacity to telecommunications service
providers for public telephone networks in Mexico and elsewhere
and to corporate customers for their private business networks
with data, voice and video applications, as well as satellite
internet services.  The Debtor is an affiliate of Loral Space &
Communications Ltd., which filed for chapter 11 protection on
July 15, 2003 (Bankr. S.D.N.Y. Case No. 03-41710).  Some holders
of prepetition debt securities filed an involuntary chapter 11
petition against the Debtor on May 25, 2005 (Bankr. S.D.N.Y.
Case No. 05-13862).  The Debtor, through Sergio Autrey Maza, the
Foreign Representative, Chief Executive Officer and Chairman of
the Board of Directors of Satmex filed an ancillary proceeding
on Aug. 4, 2005 (S.D.N.Y. Case No. 05-16103).

Matthew Scott Barr, Esq., Luc A. Despins, Esq., Paul D. Malek,
Esq., and Jeffrey K. Milton, Esq., at Milbank, Tweed, Hadley &
McCloy LLP represent the Debtor.  When the Debtor filed an
ancillary proceeding, it listed $900,000,000 in assets and
$688,000,000 in debts.


=================
N I C A R A G U A
=================


HILTON HOTELS: Enters Nicaragua under Princess Hotels Name
----------------------------------------------------------
Hilton Hotels Corp. has signed a joint venture pact with
Princess Hotels & Resorts Corporation to operate in Managua,
Nicaragua, under the Hilton Princess banner.

Hilton Hotels believes that the joint venture reflects the good
business climate in Nicaragua, El Universal-Mexico relates.  The
training and improved qualifications of the Hilton Princess
staff will be ensured online through the Hilton University.  The
online university provides a range of innovative e-learning
courses.

The opening of Hilton Princess is under an international
franchise agreement signed by Hilton International with Princess
Hotels on Sept. 13, 2005, that called for the conversion of two
properties in Central America -- one in San Pedro Sula, Honduras
and another in Managua.

                        *    *    *

As reported in the Troubled Company Reporter on Feb. 27, 2006,
Fitch Ratings downgraded these ratings for Hilton Hotels
Corporation upon completion of its acquisition of Hilton plc:

   -- Issuer Default Rating (IDR) to 'BB' from 'BBB-'
   -- Senior unsecured to 'BB' from 'BBB-'

Additionally, Fitch assigns a 'BB' rating to the $5.75 billion
senior secured credit facility.

Fitch removes Hilton from Rating Watch Negative, where it was
originally placed on Dec. 29 2005.  The Rating Outlook is
Stable.

These actions reflect Hilton's significantly levered balance
sheet subsequent to the completion of its $6 billion acquisition
of Hilton PLC, which was funded with:

   * $1.2 billion of cash;
   * $4.6 billion of bank debt; and
   * $130 million of assumed Hilton PLC debt.

The new debt consists of:

   * a $3.25 billion revolver ($1.86 billion outstanding);
   * a $2 billion equivalent term loan A; and
   * a $500 million term loan B.

The revolving credit facility, term loans, and all senior debt
will be secured by 100% of the capital stock of Hilton's U.S.
domestic subsidiaries and 100% of the capital stock in the U.K.
acquisition entity.

Additionally, Fitch believes pro forma lease payments could
approach $500 million, up from $57 million in 2004, due to the
significant number of leased rooms (43,000) being acquired from
Hilton PLC.  Fitch includes in its calculation of off-balance-
sheet items annual lease expense.  As a result of the debt
funded transaction and the assumed increase in annual lease
expense, Fitch anticipates Hilton's pro forma adjusted debt
number will exceed $12 billion.

The rating also takes into consideration:

   * Hilton's superior and diversified asset base;
   * its improved cash flow generating capabilities; and
   * the favorable lodging industry outlook.

Hilton is a leading hotel engaged in the ownership and
management of lodging facilities.  Brands within Hilton cover
the value chain and include:

   * Hilton,
   * Hilton Garden Inn,
   * Doubletree,
   * Embassy Suites,
   * Hampton,
   * Homewood Suites by Hilton, and
   * Conrad.

Hilton PLC owns the rights to the Hilton brand name outside of
the U.S. as well as the Scandic and Conrad brands.  The
transaction with Hilton International will increase the number
of rooms in the Hilton system by more than 25% to over 475,000
(80% managed or franchised, 17% owned/leased).  Pro forma 2005
EBITDA allocation is:

   * 43% owned;
   * 33% managed/franchised;
   * 16% leased; and
   * 8% timeshare.

Approximately:

   * 71% of pro forma EBITDA will be generated in the Americas;
   * 26% in Europe/Africa; and
   * 3% in the Middle East/Asia Pacific.

Fitch expects Hilton to generate a significant amount of free
cash flow in  the future despite a large capital program and
healthy dividend payments.  Assuming that in 2006 Hilton can:

   a) generate revenue per available room (RevPAR) gains in the
      upper single digits;

   b) slightly improve margins;

   c) keep its capital spending near $635 million; and

   d) maintain dividend payments of $67 million,

Fitch believes free cash flow could approach $200 million.

Additionally, management has suggested it will continue to
divest some owned assets, although no target has been revealed.
The credit facility includes a mandatory prepayment of the term
loan A with proceeds from asset sales outside of the U.S.

Furthermore, Hilton management reiterated in its recent
quarterly conference call that its strategy is to sell 'many of
the Hilton International's assets and use the proceeds to pay
down debt.' Fitch believes that the robust lodging environment
should also allow Hilton to make progress at reducing debt in
the near to intermediate term.  Fitch expects the industry's
fundamentals to remain strong in 2006, as solid demand growth
should again outstrip very modest expansion in the supply of
available rooms.

Improvements in pricing will be supported by robust demand in
all segments of the industry (luxury, upscale, and limited
service).  Lodging demand from business, group, and leisure
segments should increase modestly in 2006 based on GDP growth of
2%-3%.

Complementing the increased demand will be reduced supply
growth, particularly in the U.S.  Two factors expected to
contribute to the limited supply growth are rising construction
costs and increasing interest rates.  As a result of stronger
lodging demand and limited additional room supply, Fitch expects
average RevPAR to increase for the third consecutive year.
Reasonable margin improvements are anticipated for most lodging
companies as RevPAR growth will likely exceed growth in:

   * labor,
   * utility, and
   * insurance costs.

The Stable Outlook is based on Fitch's expectations for the
lodging industry along with Hilton successfully integrating the
acquired assets.  Also incorporated in the Stable Outlook are
meaningful asset sales in the intermediate term and strong cash
flow with the proceeds directed toward debt reduction.


===========
P A N A M A
===========


* PANAMA: Wants Ties with Venezuela Strengthened
------------------------------------------------
Panama's First Vice-President and Foreign Minister Samuel Lewis
Navarro said that his government will strengthen economic,
political and diplomatic relations with Venezuela and Russia, as
part of a strategy focused on international cooperation, El
Universal reports.

The foreign minister told local radio station KW Continente in a
talk show that he would head an official delegation to Moscow,
including business groups, following an invitation of the
Russian Government, DPA reported.

Minister Lewis Navarro pointed to the need of "looking forward"
and exploring areas different from the United States -Panamanian
major trade partner, El Universal reports.  He mentioned
Venezuela as a traditional partner in the cultural and trade
areas. In addition, the official recalled that under ex
President Mireya Moscoso, bilateral diplomatic ties dampened,
but President Martín Torrijos is closing the gap.

                        *    *    *

Fitch Ratings assigns these ratings on Panama:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling    BBB      Apr.  8, 2005
   Long Term IDR      BB+      Dec. 14, 2005
   Short Term IDR       B      Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating     BB+      Dec. 14, 2005

                        *    *    *

Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.

                        *    *    *

On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.

Venezuela's sovereign ratings are supported by superior
international liquidity and low external financing
requirements relative to similarly rated sovereigns.  The
ratings are constrained by vulnerability to external shocks
because of oil dependency; diminished capacity of the private
sector to absorb shocks because of heavy government
intervention in the productive sector; recent spending
increases that reduce fiscal flexibility; and concerns about
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.


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


* PERU: Congress May Ratify Free Trade Accord with U.S. in June
---------------------------------------------------------------
Peru's Congress will discuss the free trade agreement with the
United States following the April 9 elections and formally
approve the pact in June, Dow Jones Newswires quoted Congress
president Marcial Ayaipoma as saying.

Peru has already reached a deal with the U.S. but awaits the
legislative body's approval.

"The balance right now is that the debate will take place after
April 9," Mr. Ayaipoma said at a meeting with the foreign press
association.  "I am in agreement with having an extensive debate
and we will look at all the themes that can be resolved."

Trade talks started in May 2004 among the United States,
Colombia, Ecuador and the United States.  Colombia signed an FTA
with the U.S. in February.

The nation's agriculture sector opposed the deal believing that
it will hurt farmers.  Peru's finance ministry plans to give
compensation to cotton, corn and wheat producers costing some
$160 million over five years if the free trade deal goes into
effect at the start of next year.

The free trade pact would replace the ATPDEA, a U.S. program
that has given special tariff status to Andean nation exports in
return for drug control programs.  The ATPDEA expires at the end
of this year, Dow Jones says.

                        *    *    *

Fitch Ratings assigns these ratings on Peru:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     BB      Nov. 18, 2004
   Long Term IDR       BB      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating      BB+     Dec. 14, 2005


=====================
P U E R T O   R I C O
=====================


MUSICLAND HOLDING: Inks Stipulation on Services Pact with Deluxe
----------------------------------------------------------------
As reported in the Troubled Company Report on Mar. 21, 2006,
Deluxe Media Services, Inc., asked the U.S. Bankruptcy Court for
the Southern District of New York to:

    a. require Musicland Purchasing Corp. to assume or reject
       the Logistics Services Agreement immediately;

    b. grant Deluxe relief from the automatic stay if the
       Debtors reject the LSA; and

    c. require the Debtors to immediately pay the amounts due
       under the LSA.

                       Debtors Object

David A. Agay, Esq., at Kirkland & Ellis LLP, in New York City,
asserted that the Debtors have paid all undisputed, postpetition
amounts owed under the LSA.

Mr. Agay informed the Court that the payment arrangement between
the Debtors and Deluxe under the LSA provides for net 30-day
terms.  Deluxe issued its first invoice for postpetition
services under the LSA for $807,082, on February 6, 2006.
Deluxe issued an updated invoice for $636,861, on February 9,
2006.

The Debtors have paid the February 9 invoice.  However, they
have refused to pay the approximately $170,000 differential
reflected in the February 6 invoice, because that amount
purportedly results from Deluxe's "cost-plus margin" pricing.
The Debtors believed that this is the disputed amount indicated
in the motion.

The Debtors have agreed to escrow the disputed differential
between the two invoices and any future disputed amounts.
Thus, no grounds exist for demanding payment of a contested
administrative claim that is not yet due and payable under the
LSA, Mr. Agay asserted.

Thus, the Debtors asked the Court to deny Deluxe's request.

                         Parties Stipulate

In a Court-approved stipulation, the Debtors and Deluxe Media
Service, Inc., agree that:

   a. Deluxe agrees to adjourn that portion of the Motion to
      Compel related to compel assumption or rejection of the
      Logistics Service Agreement until the date of the final
      hearing on the Debtors' Motion to sell substantially all
      of their assets, subject to bidding procedures.

   b. The Debtors will pay Deluxe on provisional basis, without
      prejudice to their ability to dispute any portion of the
      invoices at a later date, on the basis of the same pricing
      method used in the calculation of Deluxe's Feb. 9, 2006
      invoice for January postpetition services.  Deluxe's
      acceptance of the amount paid by the Debtors will not
      constitute a waiver of Deluxe's rights under the LSA or
      under applicable law, including, but not limited to:

      * Deluxe's right to the pricing method used in its
        calculation of its February 6, 2006 invoice for January
        postpetition services under the LSA; and

      * Deluxe's ability to assert additional claims against
        Musicland Purchasing Corp. or the Debtors, including the
        right to challenge any of MPC's defenses, and Deluxe
        expressly reserves its rights with respect thereto.

      The provisional payments by MPC will not constitute a
      waiver of MPC's rights to establish that Deluxe's billing
      should have been reduced below the results obtained from
      the method used to calculate the February 9, 2006 invoice,
      nor will they constitute a waiver of any rights to defend
      Deluxe's claims, to assert set-offs with respect to those
      claims, or to assert any counterclaims against Deluxe.

   c. On the date on which a payment becomes due under the terms
      of the LSA and at the time payment is made to Deluxe using
      the February 9, 2006 invoice pricing method, the Debtors
      agree to deposit the difference between that payment and
      the payment that MPC would have made using the pricing
      method Deluxe used to calculate the February 6, 2006
      invoice, into a segregated account held by Wachovia.  At
      the time of payment to Deluxe, the Debtors will provide
      Deluxe with evidence that funds were deposited into the
      Account.

   d. The funds in the Account will only be released to the
      Debtors or Deluxe upon entry of a final order by the
      Bankruptcy Court directing payment of either party of the
      Proceeds in the Account.  To the extent proceeds in the
      Account, or any portion thereof, are determined to be due
      and payable to Deluxe, those proceeds will not be subject
      to the liens of the Secured Lenders, including Wachovia,
      the Secured Trade Creditors or any other secured creditor,
      which entities will be deemed to have waived all rights
      only with respect to the proceeds in the Account which are
      determined to be due and payable to Deluxe.

   e. The parties agree to cooperate with each other in
      exchanging any information about Deluxe's postpetition
      invoices, services and costs and the status of the
      Debtors' GOB sales and inventory movement, and other
      information as reasonably requested by either of the
      Parties.

   f. The parties will conduct discovery and prepare for an
      evidentiary hearing on Deluxe's postpetition claims under
      the LSA:

      * Initial document requests and other written discovery
        requests will be served by March 15 and answered on or
        before April 15.

      * Fact depositions will be noticed and completed prior to
        May 15.

      * Any Rule 26 expert reports will be served by May 22 and
        any expert depositions completed by June 1.

      The parties further agree that they will jointly ask that
      the Bankruptcy Court schedule an evidentiary hearing on
      the matter as soon as possible after June 1, 2006.

                 About Musicland Holding

Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products.  The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064).  James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts.   Mark T.
Power, Esq., at Hahn & Hessen LLP, represents the Official
Committee of Unsecured Creditors.  When the Debtors filed for
protection from their creditors, they estimated more than $100
million in assets and debts.  (Musicland Bankruptcy News, Issue
No. 8; Bankruptcy Creditors' Service, Inc., 215/945-7000)


MUSICLAND HOLDING: Verizon Wants Service Contract Decision Now
--------------------------------------------------------------
Pursuant to a Service Agreement dated August 2005, Musicland
Holding Corp. and its debtor-affiliates agreed to purchase a
minimum of $1,500,000 worth of telecommunication services from
Verizon Business, Inc., formerly known as MCI, Inc., each year,
over a three-year term, with additional six-month ramp-up and
ramp-down provisions.

Verizon provides telecommunication services, including:

   * interstate and intrastate telecommunications services,
   * local service,
   * regional calling,
   * local metered TI service, and
   * voicemail service.

William J. Hanlon, Esq., at Seyfarth Shaw LLP, in Boston,
Massachusetts, relates that as a part of the Service Agreement,
and as a reward for committing to the three-year term, Verizon
agreed to pay a $250,000 sign-up credit.  The Sign-up Credit
becomes due four months after the start of the Ramp-up Period,
which started on October 15, 2005.

The Service Agreement also provides that if the Debtors
terminate the Agreement before the end of the Term, or if
Verizon terminates the Agreement for a cause, the Debtors are
required to pay a pro rata portion of any and all credits.

According to Mr. Hanlon, there is a potential substantial injury
to Verizon if the Service Agreement is not assumed.  If Verizon
pays the Sign-up Credit without a prior assumption, the Debtors
will be able to reject the Service Agreement and treat both
their obligations to refund the cash Signing bonus and the
balance due for breach to Verizon as an unsecured non-priority,
prepetition claim.

The Debtors should not be allowed to pick and choose the
advantageous portion of the Service Agreement, while retaining
the option of avoiding its own obligation, Mr. Hanlon contends.

Verizon believes that the telecommunication services it provided
under the Service Agreement are necessary to the Debtors'
operations.  Thus, there is little prejudice to the Debtors'
estate in compelling them to assume the Service Agreement.

Accordingly, Verizon asks the U.S. Bankruptcy Court for the
Southern District of New York to fix a deadline for the Debtors
to assume or reject the Service Agreement.

Verizon also seeks the Court's permission to file the Service
Agreement under seal.

Mr. Hanlon notes that the disclosure of certain information
contained in the Service Agreement, including the pricing of
telecommunications services, would put Verizon at a competitive
disadvantage.

Verizon asks the Court to restrict access to the Service
Agreement to:

   (a) the Court,

   (b) the United States Trustee,

   (c) professionals retained by an official committee in the
       Debtor's Chapter 11 cases, and

   (d) those persons who:

       * are deemed acceptable by the Debtors and Verizon;

       * have executed a confidentiality agreement acceptable to
         the Debtors and Verizon; and

       * present the Clerk of the Court with a document
         evidencing satisfaction of the previous two Conditions,
         signed by Verizon.

Verizon asks the Court to rule that:

   -- access to the Service Agreement will only be for
      determining whether the relief requested in its Motion to
      Fix Deadline for Assumption or Rejection should be
      granted;

   -- any parties permitted access to the Service Agreement will
      not share any information contained in that document with
      any third party; and

   -- any party found to have violated those conditions will be
      subject to sanctions.

                   About Musicland Holding

Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products.  The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064).  James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts.   Mark T.
Power, Esq., at Hahn & Hessen LLP, represents the Official
Committee of Unsecured Creditors.  When the Debtors filed for
protection from their creditors, they estimated more than $100
million in assets and debts.  (Musicland Bankruptcy News, Issue
No. 8; Bankruptcy Creditors' Service, Inc., 215/945-7000)


OCA INC: Court Approves $15 Mil. DIP Revolving Credit Financing
---------------------------------------------------------------
OCA, Inc. (Pink Sheets: OCAI) received an interim order from the
Bankruptcy Court approving a $15 million debtor-in-possession
(DIP) revolving credit financing with Bank of America as agent,
and Silver Point Capital.  Under terms of the approval, $7
million in financing is available immediately.  The approval of
the financing is subject to a final hearing scheduled for April
5th.

The Company believes that this DIP financing will provide
sufficient liquidity for the Company to continue to perform
under its existing business service agreements with affiliated
orthodontists and vigorously defend against recent actions by
certain orthodontists that the Company contends are breaches of
their business service agreements.

                       About OCA, Inc.

Based in Metairie, Louisiana, OCA, Inc. -- http://www.ocai.com/
-- provides a full range of operational, purchasing, financial,
marketing, administrative and other business services, as well
as capital and proprietary information systems to approximately
200 orthodontic and dental practices representing approximately
almost 400 offices.  The Company and its 41 debtor-affiliates
filed for Chapter 11 protection on March 14, 2006 (Bankr. E.D.
La. Case Nos. 06-10179 through 06-10220).  William H. Patrick,
III, Esq., at Heller Draper Hayden Patrick & Horn, LLC,
represents the Debtors.  When the Debtors filed for protection
from their creditors, they listed $545,220,000 in total assets
and $196,337,000 in total debts.


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


* URUGUAY: AFAP Lobbies for Gov't to Allow Overseas Investments
---------------------------------------------------------------
Uruguay's second largest pension fund manager, AFAP Afinidad,
asks the local regulator to allow it to invest up to 10% of
their portfolios in foreign instruments, Chief Executive Officer
Jorge Gonzalez told Business News Americas.

Under the 1995 revised pension systme, pension fund managers
can't invest outside of Uruguay.

"Pension assets have reached a figure equivalent to 12% of the
country's GDP. We are trying to convince both government and
workers of the advantages of such a diversification. There is a
mentality thing about this issue that needs to be changed," Mr.
Gonzales related to Business News.

According to Business News, Uruguay's four AFAPs saw assets
under management grow 17% to about US$2.16 billion in 2005.  Mr.
Gonzalez expects AFAP Afinidad to grow its assets under
management 15% this year to US$445 million.

State-owned AFAP Republica controls about 58% of the local
market, with Afinidad holding a 18% market share.  The number of
affiliates in the system rose 4.2% to 687,100 in 2005.

Afinidad holds 28% and 24% market shares respectively in terms
of affiliates and contributors.

Uruguay has a mixed pension regime with a significant public
sector role played by state-run pension system BPS.

Spanish financial group Grupo Santander (NYSE: STD) controls
100% of AFAP Afinidad.

                        *    *    *

Fitch Ratings assigns these ratings on Uruguay:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling     BB-      Mar. 7, 2005
   Long Term IDR       B+      Dec. 14, 2005
   Short Term IDR      B       Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating      BB-      Mar. 7, 2005


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


* VENEZUELA: Government May Not Impose Ban on US' Airlines
----------------------------------------------------------
The Venezuelan government will postpone a ban that will take
effect today, March 30, against certain American airlines
provided that there is a positive environment for talks between
the U.S. Federal Aviation Administration and the National Civil
Aviation Institute, El Universal quoted Minister of
Infrastructure Ramon Carrizales as saying.

Venezuela has threatened to ban United States' airlines in
protest of a 1995 safety restriction that downgraded the
country's security, safety and technical rating.

"Our government is ready to hang up the measure, depending on
the environment for discussions," the minister told El
Universal.

A meeting between the nations' aviation agencies is scheduled to
start on Monday, April 3.  Venezuela seeks to establish equal
treatment for the airlines of both nations.

While the International Civil Aviation Organization certified in
2005 that Venezuela had 95-percent compliance with safety, FAA
has not granted the permits for Venezuelan aircraft to enter the
United States as Category 1, El Universal relates.

Flights threatened by the ban are those of Continental Airlines
Inc. and Delta Air Lines Inc. while AMR Corp.'s flights will be
reduced.

                        *    *    *

Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.

                        *    *    *

On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.

Venezuela's sovereign ratings are supported by superior
international liquidity and low external financing
requirements relative to similarly rated sovereigns.  The
ratings are constrained by vulnerability to external shocks
because of oil dependency; diminished capacity of the private
sector to absorb shocks because of heavy government
intervention in the productive sector; recent spending
increases that reduce fiscal flexibility; and concerns about
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.


* VENEZUELA: Panama Seeks Better Economic Ties with Country
-----------------------------------------------------------
Panama's First Vice-President and Foreign Minister Samuel Lewis
Navarro said that his government will strengthen economic,
political and diplomatic relations with Venezuela and Russia, as
part of a strategy focused on international cooperation, El
Universal reports.

The foreign minister told local radio station KW Continente in a
talk show that he would head an official delegation to Moscow,
including business groups, following an invitation of the
Russian Government, DPA reported.

Minister Lewis Navarro pointed to the need of "looking forward"
and exploring areas different from the United States -Panamanian
major trade partner, El Universal reports.  He mentioned
Venezuela as a traditional partner in the cultural and trade
areas. In addition, the official recalled that under ex
President Mireya Moscoso, bilateral diplomatic ties dampened,
but President Martín Torrijos is closing the gap.

                        *    *    *

Fitch Ratings assigns these ratings on Panama:

                     Rating     Rating Date
                     ------     -----------
   Country Ceiling    BBB      Apr.  8, 2005
   Long Term IDR      BB+      Dec. 14, 2005
   Short Term IDR       B      Dec. 14, 2005
   Local Currency
   Long Term Issuer
   Default Rating     BB+      Dec. 14, 2005

                        *    *    *

Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.

                        *    *    *

On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.

Venezuela's sovereign ratings are supported by superior
international liquidity and low external financing
requirements relative to similarly rated sovereigns.  The
ratings are constrained by vulnerability to external shocks
because of oil dependency; diminished capacity of the private
sector to absorb shocks because of heavy government
intervention in the productive sector; recent spending
increases that reduce fiscal flexibility; and concerns about
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.


* VENEZUELA: World Bank Approves US$200 Million in Loans
--------------------------------------------------------
The World Bank has decided to grant Venezuela four new loans
totaling US$200 million in four tranches within the next two
years, El Universal reports.

According to World Bank representative David Varela, the
projects where the loans will be used are still under
preparation and are complex in design.

The proposed projects are the financing of:

   -- water pipes and sewage systems in both urban and rural
      areas in at least eight Venezuelan states which have been
      chosen by the national water company Hidroven and its
      affiliates.

   -- a social infrastructure project in small and medium-sized
      cities aimed at expanding the success achieved in the so-
      called Proyecto Mejoramiento de Barrios.

   -- environmental projects implemented by the Ministry of
      Environment. These projects include the use of solid
      waste, sewage, national parks and forest areas.

   -- requisite infrastructure for implementing basic services
      in several indigenous communities, according to official
      ABN news agency.

According to Mr. Varela, the loans were approved after World
Bank representatives visited Venezuela to take note of the
country's needs.

                        *    *    *

Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.

                        *    *    *

On Nov. 29, 2005, Fitch Ratings assigned expected 'BB-' ratings
to the pending issues of Venezuelan government bonds maturing
Feb. 26, 2016, and Dec. 9, 2020.  The 2016 bond has a 5.75%
fixed coupon and the 2020 bond has a 6% fixed coupon.  The bonds
are being marketed in Venezuela to be purchased in local
currency at the official exchange rate but under New York law,
with all coupon and principal payments in U.S. dollars.

Venezuela's sovereign ratings are supported by superior
international liquidity and low external financing
requirements relative to similarly rated sovereigns.  The
ratings are constrained by vulnerability to external shocks
because of oil dependency; diminished capacity of the private
sector to absorb shocks because of heavy government
intervention in the productive sector; recent spending
increases that reduce fiscal flexibility; and concerns about
the rule of law and potential political instability.  Fitch said
the Rating Outlook is Stable.


                            ***********


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
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Copyright 2006.  All rights reserved.  ISSN 1529-2746.

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