www.forbes.com Reuters, 03.04.03, 2:59 PM ET By Ibon Villelabeitia

BOGOTA, Colombia, March 4 (Reuters) - Colombia and Ecuador inaugurated a $45 million power line linking the two nations on Tuesday; a move that Bogota-based electricity distributor ISA <ISA.CN> said would pave the way for a common power market across the Andean region. State-controlled ISA, Colombia's largest distributor, and Ecuador's Transelectric, have completed work on a 130 mile (210 km) transmission line with a 260-megawatt capacity across the countries' shared border, ISA President Javier Gutierrez said. "We are taking one step at a time. A year ago we were not in Ecuador and now we are going after Peru. We think it is perfectly possible to become an energy provider in an integrated Andean region market," Gutierrez told a news conference in the Colombian capital Bogota. Last December, energy officials from Colombia, Ecuador, Bolivia, Venezuela and Peru signed a regionwide regulatory structure for energy connection. With control of more than 80 percent of Colombia's high voltage network, ISA plans to build by September 2004 an $18 million power line hooking up transmission lines of Peru and Ecuador through Red Electrica Peruana, a unit of ISA. ISA, which is eyeing agreements to hook up lines with Venezuela and Bolivia, is also studying a $200 million project to connect Colombia's national grids via a cable crossing the inaccessible jungles of the Darien Gap, Gutierrez said. Speaking to Reuters, Gutierrez said the Andean common electricity market could become a springboard for ISA's future incursions into the energy market of southern South America. "We don't have any expansion plans into the south at the moment. But once we get into Peru we can get into Chile or the Mercosur trade block. We are constantly evaluating market opportunities," Gutierrez said. Mercosur includes Brazil, Paraguay, Uruguay and Argentina. In 2002, ISA posted net profits of 23.92 billion pesos, down 76.4 percent from net profits of 101.1 billion pesos in 2001, as a depreciating peso currency greatly increased the costs of the company's debt, which is largely tied to multilateral banks. ISA sales in 2002 jumped 10.2 percent to 555.58 billion pesos, up from 504.05 billion pesos in 2001. The government has a majority 58-percent stake in ISA, which has 13,000 energy pylons and nearly 5,000 miles (8,000 km) of high-and medium-tension lines in Colombia. ISA's network in Colombia has been badly hit by a sabotage campaign by Marxist rebels fighting in a four-decade guerrilla war. In 2002, rebels blew up 458 energy pylons, of which 258 belonged to ISA, Gutierrez said. ISA, which last year issued 120 million shares on the local stock market to raise $58 million for fresh investments, is mulling a listing on an international stock exchange such as New York or Madrid. ($US 1 = 2,959 pesos) Copyright 2003, Reuters News Service

news.ft.com By Andy Webb-Vidal in Miami Published: March 4 2003 19:10 | Last Updated: March 4 2003 19:10

The US faces a growing risk from both Middle Eastern terrorists relocating to Latin America and terror groups from the region, a top US military official has warned.

General James Hill, Commander of US Southern Command, told Latin American military officers and regional intelligence analysts in Miami on Tuesday that groups such as Hizbollah, the militant Shia Muslim group, had established bases in Latin America.

These groups were taking advantage of smuggling hotspots such as the "tri-border area" joining Brazil, Argentina and Paraguay, and Venezuela's Margarita island to channel funds to terrorist groups round the world.

US officials are also worried that weak state institutions are making the region a haven for operatives affiliated to groups such as al-Qaeda who may flee the Middle East in the wake of a war in Iraq.

Security experts say no specific governments in the region can yet be considered "accomplice states" for harbouring terrorists but border and immigration controls must be tightened.

Fernando Falcón, a former Venezuelan state security police chief, said: "If I were al-Qaeda, I would be setting up in Venezuela right now."

Gen Carl Freeman, president of the Inter-American Defence Board, said parts of Latin America were potential rest-and-recuperation hideouts and stop-off points before entry to the US. "Latin American countries are vulnerable," he said. "Terrorists will find the weak link in the chain and take advantage."

Gen Hill also warned that the long-running, drug- fuelled conflict in Colombia was spilling over its borders. "There were more terrorist attacks last year in Colombia alone than in all the other nations in the world combined. This is a battle that must be fought together. If we don't, I fear we risk winning the battle in Colombia and losing the war in the rest of the region."

The warning comes as the strongest signs emerge that the Colombian conflict is becoming enmeshed with increasingly violent political tensions in Venezuela.

Two powerful bombs damaged the Colombian and Spanish diplomatic missions in Caracas last week. The attacks came shortly after Venezuela's President Hugo Chávez criticised Colombia, Spain and the US for meddling in Venezuela's "internal affairs".

Last weekend near their shared border, the Colombian and Venezuelan military defused a truck-bomb several times larger than one that killed 36 at a club in Bogotá.

Mr Chávez said this week that the suspected embassy bombers had been "identified" as linked to opposition groups bent on denigrating him and pinning the blame on his government.

However, intelligence sources in Miami said they suspect the perpetrators were linked to the Revolutionary Armed Forces of Colombia (Farc) or a group on the fringes of Venezuela's state security police.

Colombia's state security police said yesterday it was investigating the passage of rebels from Farc, including its chief, Manuel Marulanda, across the border into Venezuela.

The deepening insecurity in Venezuela comes as the US steps up its training of the Colombian army in its war against Farc.

Three US citizens working under a US Defense Department contract are being held as "prisoners of war" by Farc after being captured last month.

The US is understood to have agreed to dispatch "intelligence assistance teams" to the Colombian military, although it is not permitted to maintain more than 400 US troops in Colombia, a cap designed to prevent "mission creep".

Robert Steele, a former deputy director of US Marine Intelligence and a private sector adviser, said US resources should be better used to help avert Latin American economic crises that could breed radical political groups. "We have cold war mindsets that are not adequate for today. The US thinks of Latin America as a benign backyard. They are wrong. It is a nightmare ready to go north, and the Americans don't understand that."

www.vheadline.com Posted: Tuesday, March 04, 2003 By: Oscar Heck

VHeadline.com commentarist Oscar Heck writes: I have been getting some flack from some irate opposition people recently ... again ... calling me "ignorant and uneducated." Why? Because they think I have some figures mixed up.

I will explain: According to the opposition, the recent Firmazo (Signing) of February 2, 2003, accumulated 4.4 million signatures in several petitions including one asking Chavez to resign.

According to recent opposition sponsored press announcements, TV ads and newspaper editorials, 70-80% of the Venezuelan population want Chavez to resign.

Where do they get these figures?

The only explanation I have seen is the following:

4.4 million signatures of a possible 6 million, represents 73%.

Why 6 million? Because, they base themselves on the voter turnout of 1998, when Chavez won the elections with approximately 56% of the votes (3 million+ votes).

The abstention rate was approximately 50% at the time.

Now, what perplexes me? The firmazo was intensely advertised (and pounded into people's heads) for weeks previous to February 2, 2003.  There was a monumental effort by the opposition to have as many people as possible show up to sign. So, if the turnout for the firmazo was say 80%, which I believe is a little low (i.e., abstention of 20%), then this means that the maximum number of anti-Chavez signatures could have been 5.5 million signatures.

Now, if elections were held ... and the abstention rate is 20% ... this means that 9.6 million people would vote and Chavez would get 4.1 million votes (43% of all votes). Together, all other opposition parties would have a total of 5.5 million votes, that is 57% of all votes. (It seems to me that 57% anti-Chavez votes are a far cry from 70-80%.)

Based on the above figures, for Chavez to lose the elections, one opposition party would have to have at least 4.1 million votes +1, that is 4.1 of 5.5 million anti-Chavez votes, or 75% of these votes.

I suppose, theoretically, this could happen ... but I doubt it, especially since there are 18 political parties represented in the National Assembly, a good portion of them being anti-Chavez.

Another point is that if the turnout for the 'firmazo' was higher that 80 % ... say 90% (which I believe is closer to reality - especially after all the advertising) ... then Chavez would win the elections, no matter how many votes the opposition would get -- the maximum number of combined anti-Chavez votes would be 4.9 million of a total of 10.8 million, or 45%.

The flack I have been receiving is precisely concerning the above discussions.

Does the opposition really believe that if there were elections, there would be 80% anti-Chavez voter turnout and say 50% pro-Chavez voter turnout?

Or that if an election were held, the voter turnout would still remain at 50% ... as it was in 1998? I don't think so!  I believe that voter turnout will be the highest in Venezuelan history. My prediction is that the anti-Chavez and pro-Chavez voter turnout will be about 80%.

The fact that the opposition is claiming that 70-80% of the Venezuelan population wants Chavez out, is based on a false premise that the turnout for the 'firmazo' was 50%!

I don't think so ... considering the amount of advertising and incitement that went on, my estimate is that the turnout for the 'firmazo' was closer to 90%.

Furthermore, if elections were called, Chavez would ask all his supporters to go to the ballot box ... just as the opposition would.

Now, supposing that the opposition's premise (50% turnout) is correct ... then Chavez would win 1.6 million votes.  For Chavez to lose, one anti-Chavez political party would have to win at least 1.6 million votes ... or 26% of the anti-Chavez votes.

According to the Venezuelan National Assembly site the anti-Chavez political party that holds the largest number of seats is Accion Democratica (AD) with 15% of the seats. (Remember that there are a total of 18 political parties represented at the National Assembly).  This would mean that Accion Democratica ... one of the conventional Venezuelan political parties ... would have to increase their votes by approximately 75%!

Considering that the Accion Democratica is still, in the eyes of many Venezuelans, the party that is associated with Carlos Andres Perez and massive proven corruption, it appears to me that an increase of 75% is asking a lot.  I could be wrong, but I doubt it.

Now, I can understand that many opposition people would love their premise to be correct. If it is correct, I must congratulate them for seeing more deeply into the situation than I have been able to do.  However, I find it difficult to believe, especially since 12 weeks of travel across approximately half of Venezuela's territory has not demonstrated to me that the premise is valid.

Another factor:  The opposition claims that many people who voted for Chavez in 1998 signed at the 'firmazo.'  Numbers-wise this bit of information only has bearing on the matter if their premise is correct.

Another interesting fact: The opposition has been inviting all Venezuelans to take to the streets for the last 3 Sundays ... a  religious march for "Venezuela", "for peace", "for democracy". This past weekend they added "against political persecution."

Oscar Heck oscarheck111@hotmail.com

www.vheadline.com Posted: Tuesday, March 04, 2003 By: Patrick J. O'Donoghue

Andres Bello Catholic University (UCAB) and the Metropolitan University are the only universities that kept their promise to recover classes lost during the two-month national stoppage during the Carnival holiday.

Attendance Monday at UCAB’s Faculties of Education, Media Studies and Engineering was around 100%, while 50% of law students preferred to stay away and enjoy the holiday break.

Private and public secondary schools did not open either.

Venezuelan Teachers Federation president Jaime Manzo failed to live up to his promise to recommend union members to show President Hugo Chavez Frias how determined they were and recover classes during the weekends and holidays. As expected and true to form, teachers opted out of their pledge to turn up for classes during Carnival.

One critic says he is disappointed ... "anti-Chavists failed to gain political and moral capital, while pro-Chavist teachers show they are just as mercenary as their colleagues."

www.vheadline.com Posted: Tuesday, March 04, 2003 By: Patrick J. O'Donoghue

Comptroller General Clodosbaldo Russian admits that he has ordered an investigation into the role of the top 7 dismissed Petroleos de Venezuela (PDVSA) executives and managers organized in what has been described as the “shadow PDVSA” or "Gente de Petroleo" in Spanish.

Russian claims that the rebels must assume responsibility for the damages they allegedly caused to Venezuela’s prime industry and “patrimony.”

“The PDVSA stoppage was political and aimed at ousting President Chavez Frias and calling elections.”

Urging the seven to turn up at the 50th control court and face the music, Russian says the Comptroller General’s first task is to investigate patrimonial damage caused by not being able to sell oil and sabotage on PDVSA installations.

“Who is responsible for damaging 80 kilometers of pipeline after petrol solidified? Or the money that went into repairing computer equipment, just to mention two examples?”