<a href=www.vheadline.com>Venezuela's Electronic News Posted: Monday, May 05, 2003 By: David Coleman

Crystallex International (KRY) president & CEO Marc J Oppenheimer has told a National Assembly (AN) Commission on Economic Development that his company is making significant progress on a last-September awarded contract with the Venezuelan Guayana Corporation (CVG) as the exclusive mine operator to one of South America's richest gold reserves.

Marc Oppenheimer says that Crystallex operations at the Las Cristinas deposit will have a very positive impact on regional economics, adding that he feels proud that his company was selected to develop this important Venezuelan project which should have been operative at least 12 years ago ... "Crystallex International has always has believed in Venezuela, since we have developed different projects in good times and in bad ... we have always maintained our faith in a positive outcome for Venezuela.".

On the basis of technical and feasibility studies, Oppenheimer says he anticipates operations at Las Cristinas to continue for several decades.  Some weeks back, international finance representatives, including top executives of Germany's Deutsche Bank GMBH, had visited Venezuela for an on-site inspection and evaluation of his company's progress and they had all left with very favorable impressions of both Venezuela and Las Cristinas with its associated operations.

Under the terms of the CVG/KRY contract, the Vancouver-based mining corporation has already paid US$15 million for the use of previous mine studies leading to a fresh appraisal of reserves at Las Cristinas which have been duly completed.  The contract establishes the payment to the CVG of a royalty of between 1% and 3% of the commercial value of extracted gold and operative taxes according to Venezuela's new Mining Law.  Additionally, Crystallex de Venezuela has undertaken to hire international gold experts and to initiate a regional training system with special emphasis on neighboring developments including health, welfare, schools, roads, water treatment plants and other urban infrastructure with technical support to organized small-scale mining operations in southeastern Bolivar State.

AN vice president Ricardo Gutierrez and deputies Rodolfo Gutierrez, Arnoldo Marquez, Luis Frank Beltran, Manuel Carmona with other members of the commission heard local Crystallex de Venezuela C.A. president Luis Felipe Cottin detail the development as being responsible for all investments and work necessary to reactivate the Las Cristinas mine after more than a decade during which it has lain idle.  Cottin said his company will be responsible for designing the mine, constructing necessary plant and exploiting its gold reserves for the duration of the operating contract which ... with extensions ... could extend 40 years.

Bolivar State deputy Luis Frank Beltran said that Crystallex' progress with Las Cristinas will generate greater confidence in Venezuela's gold mining sector and has urged the President of the Republic to use it as a shining example for foreign investments in Venezuela ... committee vice president Ricardo Gutierrez adding that the project is of great importance for the eastern region of Venezuela, Bolivar State in particular ... "Crystallex has kept an open dialogue with CVG president, Major General (ret.) Francisco Rangel Gomez to ensure an exact interpretation of project developments and their relationship with regional development in the Guayana region."

AN Permanent Commission of Economic Development president Victor Cedeno said "we must emphasize that our government has acted within the legal framework necessary to protect and conserve the interests of our Nation ... for that reason, we are proposing the creation with Crystallex of a special forum in Puerto Ordaz ... the general public and all those who take an active part in the life of the CVG and Bolivar State will be able to familiarize themselves with all aspects of the Las Cristinas project and what has already been accomplished.

05 May 2003 20:59:42 GMT By Patrick White

MONTREAL, May 5 (Reuter-Alertnets) - Cesar Gaviria, head of the Organization of American States, said on Monday he was concerned about Cuba's crack-down on dissidents and the OAS was working on a statement about the Latin American country.

"I am personally concerned about the situation of human rights and public liberties in Cuba, and I am waiting for the OAS permanent council to express (this) politically," Gaviria told reporters in Montreal.

He would not say when the statement would be issued and stressed some countries did not only want to deal with the human rights issue in Cuba.

"Many countries do not just want to talk about human rights. They want a statement (on Cuba) that is more comprehensive of the current situation," Gaviria said.

President Fidel Castro's government has come under heavy international criticism after sentencing 75 dissidents to long prison terms last month, and executing three men who hijacked a ferry in a failed bid to reach the United States.

Havana has said the crackdown is in response to what it says is a U.S. plot to topple the Castro government.

Gaviria, a former president of Colombia, also said he was expecting an agreement "in a few weeks" on a referendum on the rule of Venezuela's President Hugo Chavez.

The OAS last month brokered a deal on a referendum after talks between Venezuelan opposition leaders and government negotiators. But a week later the government backed away from signing the accord.

Gaviria is scrambling to patch up the agreement and said he hoped the deal would not lead to confrontations like those last year, when Chavez survived a brief military coup which was followed by months of protests and street clashes.

"Politics in Venezuela today is very very confrontational. We may have risks of violence as we have seen in the last few months," Gaviria told a news conference.

Chavez, elected in 1998 on promises to ease poverty, and his foes have been locked in a political struggle since last year's failed coup.

Mon May 5, 2003 05:17 PM ET CARACAS, Venezuela, May 5 (<a href=reuters.com>Reuters) - Venezuela's largest private energy generator and distributor, Electricidad de Caracas (EDC) EDC.CR , on Monday reported a narrower first-quarter net loss of 25.6 billion bolivars and said it had reduced its costs compared with a year earlier.

EDC, an affiliate of U.S. power firm AES Corp. AES.N , said the quarterly result represented a 25 percent improvement over the net loss it posted a year earlier.

Since February, the fixed exchange rate has been 1,600 bolivars to the U.S. dollar. The company did not immediately provide its dollar results.

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Monday, May 05, 2003 By: Jose Gabriel Angarita

VenAmCham's Jose Gabriel Angarita (economist) writes: More than 100 days since January 21, 2003, when the Venezuelan foreign exchange market closed its doors and the supply restriction became absolute, the chief executive explained that "the State has no intention of monopolizing foreign exchange, but rather, of competing with the private sector" and confirmed that exchange controls will continue to be very strict. He also acknowledged the shortages of some regulated products and announced a massive import plan to counteract them.

About 6,200 tons of chicken will be imported from Brazil, by land and by sea; 80,000 bags of wheat flour will come from Italy, and a reserve of 12 million eggs will be built up to cover demand. The Venezuelan government made clear its intention of continuing with its food import plan to cope with shortages.

It is very important to stop and analyze the implications and consequences of the government's good intention to relieve the Venezuelan consumer's plight, only in the short run.

In the first place, under the Andean Community of Nations (CAN) rules, imports from Brazil must meet the Andean Community requirements and the health requirements spelled out in Resolution 449 on Trade with Third Countries, and are subject to a tariff in accordance with the prescribed variable rates.

In the second place, we should not forget the negative effect of imports of these products on Venezuelan producers, for whom the exchange controls and price regulations have imposed inefficiencies in productive processes, generating unemployment and leading to company failures. Foreign competition will intensify the critical situation in the food sector.

Neither should we neglect the potential macroeconomic implications of the massive import policy the government plans to apply when the main goal of the exchange controls --rebuilding the foreign reserves -- is threatened by the outlays made for external purchases. There may also be distortions in the current account of the balance of payments, since the tradable goods sector is deeply depressed.

Obviously, this situation will be sustainable only in the short term; in the medium term, national private enterprise will continue weakening even more, and if the current policy remains in force the smaller companies will tend to disappear, adding large numbers of employees to the ranks of the unemployed. Reversing the process will require an industrial policy designed to strengthen national capital for transfer to all the sectors of the economy, stimulus for an efficient allocation of resources, and creation of new jobs.

Mon May 5, 2003 04:11 PM ET (Releads, adds details and background)

NEW YORK, May 5 (<a href=reuters.com>Reuters) - Venezuela's recession-bound economy got more bad news on Monday, when the country was dropped from the FTSE All-World Index as tight foreign exchange controls hampered international investors.

The FTSE Group, which manages the global index of 49 developed and emerging countries, said that, since foreign exchange is not available to international investors wishing to sell on the Caracas stock exchange .IBC , Venezuela is in breach of ground rules written for the management of the index.

Venezuela, the No. 5 oil exporter, will be removed at the close of business on June 20 and the change will be effective Monday, June 23. The Latin American country will be removed at nil value.

"Many fund managers have marked the value of Caracas-listed shares held to zero," said Peter Leahy, Co-Chairman of of the FTSE Americas Regional Committee, in a release.

The FTSE Group, which is co-owned by the London Stock Exchange and the Financial Times, is a leading index manager -- most notably of the FTSE 100 at the London Stock Exchange.

Venezuela, which will attract fewer investors as a result of the FTSE action, is struggling with one of the worst downturns in its history after a two-month opposition strike in December and January slashed its vital crude production and shipments.

The government in February introduced strict currency and price controls to halt capital flight and stem inflation. But the curbs have left the private sector starved of essential hard currency for more than three months.

Business leaders have warned the controls will further curtail economic growth, batter the private sector and prevent importers paying debts with external suppliers.

"These exchange controls make Venezuela effectively uninvestable," Leahy said.

The Caracas stock market's leading player, No. 1 telephone firm CANTV VNT.N TDVd.CR , an affiliate of Verizon Communications VZ.N , is traded in the United States in ADR form. But the Venezuelan firm recently issued an investor warning saying it might not be able to pay its dividends in dollars due to the forex controls. (Additional reporting by Patrick Markey)