<a href=www.vheadline.com>Venezuela's Electronic News Posted: Friday, March 28, 2003 By: Patrick J. O'Donoghue

In the continuing battle of words between the Bush administration and Venezuelan President Hugo Chavez Frias, State Department Richard Boucher has dismissed allegations that the Anglo-American war on Iraq has led to a loss of US leadership in Latin America. 

President Chavez Frias says the scant support in Latin America shows that the US is losing out south of the border. 

Referring to Chavez Frias' latest challenge, Boucher says, "It's neither a logical argument nor has it an base in reality ... the fact that some countries in the western hemisphere have stood up and asked to be counted in this matter is important for us."

Calling seven Latin American countries "volunteer members of the Coalition," Boucher says the Central American countries of Honduras, El Salvador, Costa Rica, Panama and Nicaragua support the Anglo-American war on Iraq, along with Colombian and the Caribbean country of the Dominican Republic. 

Boucher did not comment President Chavez Frias' allusion to Brazilian President Lula da Silva's anti-war statements and Chile's initial position on the UN Security Council.

EDUARDO KAPLAN, Dow Jones Newswires Friday, March 28, 2003 (03-28) 11:49 PST (AP)

<a href=www.sfgate.com>A Dow Jones News Analysis

NEW YORK (Dow Jones/AP) -- For all the talk about orderly debt restructuring, every day seems to bring news of a new Latin American government or company rushing to exchange its bonds.

The latest to join the growing line was the market-unfriendly government of Venezuela President Hugo Chavez, who announced Wednesday his cash strapped country will seek to exchange part of its foreign debt.

The news came just as Uruguayan officials were flying back home after an international roadshow to discuss a debt exchange that could reach $5 billion.

Meanwhile, several local and foreign companies that went on a shopping spree throughout the region in the 1990s are now dealing with devalued assets, depreciating currencies and lowered growth expectations.

A unit of Spain's Endesa in Chile, Brazil's local divisions of U.S.-based AES Corp., and Mexico's TV Azteca are some of the names talking to creditors about their debt burdens.

Still hovering over the horizon is the massive restructuring that Argentina will have to eventually face following its sovereign debt default in late 2001, which surpassed the $100 billion mark and triggered the country's unprecedented economic collapse.

It's hard to pin down a total figure, but Jose Barrionuevo, director of emerging market strategy at Barclay's in New York, has seen enough to call Latin America the most leveraged region in the emerging market sector.

"I can't remember a time like this," said Barrionuevo. "It's a reflection of a weak global environment which suggests things may not be improving soon, but it's worse for many of these economies since they have been in recession or close to one for three or more years. We won't have a new credit cycle until the U.S. starts growing."

Global investors who have been dealing with a fair share of bursting credit bubbles in the past three years may temporarily overcome their debt restructuring fatigue and listen to some of the latest overtures by sovereign issuers.

After all, as a recent Lehman Brothers report pointed out, debt restructuring under the threat of default is still preferable to outright default.

Uruguayan officials attested to this sentiment last week after a round of meetings with U.S. investors. The country's central bank president, Julio de Brun, said reactions were better than expected. Venezuela will likely meet willing parties, judging by the early responses.

"This is a rush, but it's more orderly than the credit restructuring in the 1990s," said Christian Stracke, head of emerging market research at independent research firm CreditSights.

Stracke was referring to the sovereign debt crises in the latter part of the decade following debt defaults by Russia, Ukraine and Ecuador.

"I think that Uruguay and Venezuela are showing that they have learned some lessons from what happened to Ecuador and Russia, for instance. They are trying to approach creditors first, instead of defaulting. They are addressing a problem of temporary liquidity, not of solvency," Stracke said.

This palpable sense of progress is a welcome development, but being able to talk to investors will amount to nothing more than good intentions if no deals are struck.

Barclay's Barrionuevo questions the prospects of the latest debt exchange offers if Uruguay and Venezuela can't come up with decent incentives for bondholders. He also said he expects Ecuador to join the ranks and start talks with creditors in the second half of the year.

Bad as conditions sound for sovereign issuers, they are even tougher for companies trying to restructure debt.

"I think in many cases you have a solvency problem," Stracke said. "Many of these companies are operating in environments where there are no sources of financing and economies aren't posting growth."

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Friday, March 28, 2003 By: Patrick J. O'Donoghue

National Assembly (AN)  government and opposition benches are busily concerting pacts and agreements to reach some kind of consensus about 5 of 87 candidates to fill the new National Electoral College (CNE)  board posts. 

Top Movimiento Quinta Republica (MVR) candidates are: current CNE board member Romulo Rangel, CNE official Esther Gautier and former Liga Socialista leader and current Poder Ciudadano member, Oscar Battaglini. However, President Chavez Frias has not yet approved MVR's three choices.

• The opposition are supporting Sobella Mejias Lisett proposed by the civil sector and Miguel Manrique Ravelo proposed by the Universidad Central de Venezuela (UCV) Faculty of Legal & Political Studies Council.

The name of former CNE board member (1998) Miriam Kornblith, considered a hot favorite, has been put on hold during current bench negotiations. Experts say her overt anti-government stance has not helped her cause. Proyecto Venezuela (PV) is the only group still supporting her.

Apart from discussing the 5 board candidates, corridor and behind closed doors consultations are going on to choose candidates to lead key CNE offices as the Electoral Registry and Finances, just to mention two.

<a href=www.vheadline.com>Venezuela's Elecronic News Posted: Friday, March 28, 2003 By: Patrick J. O'Donoghue

Planning & Development Minister Felipe Perez Marti says Petroleos de Venezuela (PDVSA) is poised to sell the Central Bank of Venezuela (BCV) $625 million.  "Definitely good news ... in normal conditions PDVSA offers the BCV $300 million a week ... once the first lodgment has been made, it will boost international reserves." 

However, critics argue that there are invoice problems, especially in international reserves because despite the suspension of foreign currency exchanges since March 21, reserves have only increased in $339 million. 

Adding to the doubt, PDVSA subsidiary in the USA, Citgo has not registered income to the BCV, even though a Citgo communique has announced that it is paying for all PDVSA cargoes of crude and complying with supply contract terms.

Another contradiction, critics claim, lies in PDVSA's total invoice ... Minister Perez Marti estimates $1.8 billion, as do internal PDVSA estimates ... in contrast, Energy & Mines Minister Rafael Ramirez' tally is $3 billion, that is from December till today.

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Friday, March 28, 2003 By: Patrick J. O'Donoghue

The Puerto La Cruz refinery has announced it will be closing down for 25 days to do important maintenance work. 

Deputy manager, Alejandro Granados reports that the stoppage had been postponed several times but will finally come into effect on May 1st. 

"Among the technical objectives is to optimize the FCC and sulphur units ... workers are currently engaged on minor maintenance works." 

Grandados points out that supplies and materials have been bought to avoid any delays in getting the plant up to standard and says the Petroleos de Venezuela (PDVSA) Intevep research unit will send a specialized team to supervise major works. 

"We will be hiring 250 temporary workers during the stoppage ... welders, fitters, workers electricians and mechanical engineers and we have asked contractors to hire local people." 

PDVSA Puerto La Cruz will contract out special activities, such as the chemical cleaning of pipelines and refractory installations.