Venezuela's Sidor gets $60 mln for debt payments

Reuters, 06.17.03, 6:24 PM ET  CARACAS, Venezuela, June 17 (Reuters) - Venezuelan steelmaker Sidor, the largest steel producer in the Andean region, has received more than $60 million from the state currency control board CADIVI to start a program of scheduled debt payments to its creditors, CADIVI said Tuesday. The hard currency allocation to the troubled steelmaker, which last year reduced its $1.4 billion debt by nearly half in a major debt restructuring, consisted of $58.5 million $2.6 million, the currency board said in a statement. "This restructuring permitted a reduction of the amount owed from approximately $1.4 billion to $800 million. A schedule of payments was established which has now begun with this first handover," CADIVI said. The Amazonia consortium that controls Sidor (Siderurgica del Orinoco) consists of Mexico's Hylsamex <HYLSAMXB.MX> and Tamsa <TAMSA.MX>, Argentina's Siderar <SID.BA>, Usiminas <USIM3.SA> of Brazil and Venezuela's Sivensa <SVSa.CR>. CADIVI's allocation to the steelmaker indicated that the much-criticized Venezuelan currency board was moving to free up hard currency for companies squeezed by debt payments or requiring dollars to import essential goods. Since currency controls were introduced by President Hugo Chavez's government more than four months ago, business leaders have complained bitterly that the slow allocation of funds by CADIVI is strangling economic activity in the world's No. 5 oil exporter. Venezuela is experiencing its worst recession in recent history following an opposition strike against Chavez in December and January which disrupted oil exports and slashed government revenues. The oil-reliant economy contracted nearly 30 percent in the first quarter. Sidor's debt problems were brought on by a sharp fall in international steel demand and prices and a shrinking domestic economy.