<a href=www.falkland-malvinas.com>Mercosur Press Wednesday, 11 June

Unites States Secretary of State Colin Powell in a brief visit to Buenos Aires (two and a half hours) met Tuesday morning with Argentine President Néstor Kirchner and described the event as an “encounter of friends”.

"Encounter of friends" This is the first top official of the George Bush administration to meet with the new, relatively unknown Argentine president, (in office since May 25), and was interpreted as a first positive approach for both sides given the almost undisputed Washington position in world affairs, and Argentina’s recent political and economic turbulence including a massive default on its foreign debt in January 2002.

Mr. Powell arrived in Buenos Aires in an Air Force One aircraft carrying as a special guest Argentine Foreign Affairs Minister Rafael Bielsa with whom he participated in the Organization of American States General Assembly hosted by Chile.

The Buenos Aires Powell stop was just a few hours before president Kirchner left for Brazil on an official state visit to meet with counterpart Luiz Inacio Lula da Silva to ratify the consolidation of a “strategic Argentina-Brazil alliance”, and strengthen Mercosur, the South American trade block that also includes Uruguay, Paraguay and associate members Chile and Bolivia.

During the press conference in the Casa Rosada after meeting with President Kirchner, Mr. Powell underlined the good relations between both countries adding that the Bush administration was willing to grant Argentina strong support to address the still very difficult economic decisions lying ahead.

Argentine Foreign Affairs Secretary Bielsa indicated that Mr. Powell also agreed that the coming discussions of Argentina with the international multilateral credit organizations, (IMF, World Bank), must be focused on the long term and can’t be expected to have an immediate response.

Regarding the US sponsored Free Trade Association of the Americas (FTAA) that should be operational by 2005, Mr. Powell said that the Bush administration supports regional agreements and Mr. Bielsa added that during the meeting with President Kirchner there were “no excluding economic formulations”, highlighting Argentina’s support to the recently free trade agreement signed between United States and Chile.

“It took the Chileans twelve years of negotiations; we’ve just managed four years, so Argentina has a long distance ahead”.

Mr. Powell also admitted that with President Kirchner they discussed the clash between the Argentine Executive and the Supreme Court, highlighting that the Bush administration has no particular position on the issue besides the strict honouring of the Argentine legal process and Constitution.

President Kirchner is attempting to impeach several of the magistrates arguing they have dishonoured the Supreme Court with some of their rulings and attitudes. Actually the Argentine Judicial branch is quiet discredited before public opinion and Mr. Kirchner is determined to end what is described as the “automatic majority” of the Supreme Court, a faithful legacy of the ten years of former president Carlos Menem administration who had them appointed.

The possibility of Argentina sending gendarmes to help with law and order in Iraq as requested by Washington, was not specifically considered. Argentina under previous president Eduardo Duhalde, as most of Latinamerica, criticized the US-UK war against Iraq but now has shown willingness to collaborate in the reconstruction effort however under United Nations initiative. The US Secretary of State recalled that Argentina was a staunch ally during the first Gulf war in 1991.

Mr. Powell who arrived in Buenos Aires at 09:40 took off for the United States at12:15.

Meantime in Brasilia, Presidents Lula da Silva and Kirchner and their closest officials will have a full day of discussions this Wednesday.

However in spite of the different emphasis regarding trade policy and regional blocks, Mr. Lula da Silva is scheduled to meet President Bush in Washington next June 20 and Mr. Kirchner sometime in the coming three months.

In Buenos Aires analysts with some degree of sarcasm speculated that Mr. Powell actually was interested in personally finding out who Mr. Kirchner was closer to: Venezuela’s Hugo Chávez, a constant motive of concern for the State Department given his erratic policies, or the more mature, sober and responsible Socialist Chilean president Ricardo Lagos, who in spite of differences over the Iraq conflict has become a reference point for the Bush administration.

With President Kirchner it was a “meeting of friends”, a description long disappeared from the Venezuela-US vocabulary.

Business Week

Foreign Minister Maria Soledad Alvear discusses the country's push for free trade agreements and relations with the U.S. Considered the most disciplined free-market economy in Latin America, Chile started opening to foreign competition in the early 1980s and today boasts an average 6% tariff on all imported goods. The country of just 15 million inhabitants has free trade agreements with the European Union, Canada, Mexico, and Korea, and special trade accords with most of Latin America.
When the North American Free Trade Agreement was approved back in 1993, Chile was promised it would be the next country to get a free trade deal with the U.S. Although President Bill Clinton was unable to win fast-track negotiating power, Chile went ahead with the talks anyway, two years ago. Then the Bush Administration won fast-track authority last August. The two countries finalized negotiations late last year, around the same time a similar U.S.-Singapore trade deal was wrapped up. Yet Bush signed the Singapore agreement in early May in a White House ceremony and made Chile wait for a June 6 signing -- in Miami. Why? Officials in Washington said they were "disappointed" with Chile's failure to support the Iraqi war from its seat at the U.N. Security Council. Political analysts in Washington and Santiago believe the delay was aimed at making the Chileans aware of how deep that disappointment was. On May 28, the day after the U.S. finally announced the June 6 signing date, Chilean Foreign Minister Maria Soledad Alvear talked with BusinessWeek's Latin America Correspondent Geri Smith about U.S.-Chile relations and the prospects for free trade. They met in the Foreign Relations palace in downtown Santiago. Alvear, 52, a lawyer, formerly served as Chile's Justice Minister and as the Minister for Women after Chile returned to democracy in 1990 after 17 years of military rule. Edited excerpts of their conversation follow: Q: What is the significance of the Chile-U.S. free trade agreement for the Chilean economy? A: I'm very happy about it. We've negotiated a free trade agreement that's very good for both countries. Chile has a clear export strategy aimed at developing the economy and in particular aimed at diversifying our exports. We couldn't do that without this agreement. It's a seal of quality for our country as a reliable place to make investments. We have signed agreements with the U.S., the European Union, South Korea, Latin America, and soon we'll sign with the non-EU nations. This gives us a very interesting horizon. Q: This is said to be a "third-generation" trade agreement because it covers intellectual property, electronic commerce, services, and government procurement. In that sense, it could be a template for other trade agreements around the world. But some Chileans say the government wanted the agreement so badly it caved in by not insisting on eliminating U.S. anti-dumping rules. Chile also agreed to loosen its restrictions on capital flows even though those restrictions have protected the country from financial volatility in recent years. A: We were very conscious that we weren't going to manage to eliminate U.S. anti-dumping rules, which are being looked at in multilateral forums like the World Trade Organization. Nevertheless, we agreed to mechanisms for dispute resolution that are quite modern. And with regard to capital controls, we're satisfied with what was achieved. Q: How would you describe U.S.-Chile relations now, after the Iraq flap? A: They're good. I was in Washington less than a month ago and had the opportunity to meet with Secretary of State Colin Powell, with U.S. businesspeople, and with members of Congress. I perceived that while the U.S. didn't like the fact that Chile was opposed at that time [to the Iraq U.N. Security Council resolution], that they view the free trade agreement positively. We have a very full agenda of economic issues. We have work to do together on issues of democracy and human rights. We're working together on the Free Trade Area of the Americas. We've worked together to help the Organization of American States find a solution for the [political] problems in Venezuela. We're working together in many arenas. Q: How long will it take to rebuild relations with Washington? A: I believe each side understands the other's position, that there was a specific difference [of opinion], with the best of intentions, at a certain point in time...and at this point we have to look toward the future. The Singapore agreement was finished first because Singapore didn't have an agriculture chapter, and they didn't require translation of the agreement into another language. So, if you look at it objectively, there was never a delay [in signing Chile's agreement]. Q: Some say the Chile-U.S. Free Trade Agreement is a template for the proposed Free Trade Area of the Americas, the 34-nation accord currently under discussion for the hemisphere. A: This is a FTA negotiated between a small emerging-market country and the most developed economy of the world. If we're capable of reaching such an agreement, that improves the possibility of reaching a larger agreement among 34 countries with different levels of development around the region. Some countries in the region believe that it's perilous for small developing countries to sign commercial agreements with industrial countries, but we are proof that it's not. The negotiation between Chile and the U.S. and the negotiations now under way between the U.S. and Central America will be very interesting and important for the Free Trade Area of the Americas. Q: Chile already has agreements with all of Latin America except the Caribbean. Why is the Free Trade Area of the Americas important to you if you already have most of the region covered? A: Because Chile is a small economy, and we have placed a big emphasis on exports. Having clear rules for all of the countries in the region will be an important stimulus. Chile's decision to open up to the world allowed us to double our gross domestic product in the 1990s -- something that had previously taken us 50 years to do. At the same time, we were able to halve the number of Chileans living in poverty. We're very conscious of the fact that this process of market openings mean growth for countries. And if the countries carry out good social policies to lift people out of poverty, even better. That's why it's important that the region enjoy stable, solid democracies. Latin America has lived through very painful periods. Today we have recovered our democracies, but the problem now is maintaining governability. Many of the problems we see in Latin America today are caused by painful poverty and pent-up demands from society. We believe there's a way out of this situation, and it's important to work together to increase the possibility of development and reduction of poverty. Q: In just a few months, Chile will mark the 30th anniversary of the bloody military coup that ousted Socialist President Salvador Allende. The military ruled for 17 years, and Chile has been a functioning democracy only since 1990. You've been a Cabinet Minister in all three governments since then. How do you feel the country has changed? A: If a person had been asleep all these years and woke up today, he would not recognize the country. Of course, the most important thing was the restoration of democracy, freedom, and respect for human rights. Chile was an isolated country, and when it returned to democracy it had to reinsert itself in the world. Today, it's a key member of the most important political forums, including the U.N. Security Council. If you look at census figures, you'll find that 80% of the young people in college today had parents who didn't attend college. Among the poor, the number of households that own a washing machine has doubled [in these 13 years]. The role of women in public life has been remarkable. Chile has a woman serving as Defense Minister. When she and I go to Buenos Aires to meet with our Argentine [male] counterparts, they will see two women, and that reflects in many ways the changes Chile has gone through. Q: As one of Chile's most prominent politicians, a leader of the Christian Democratic party, you're often mentioned as a probable front-runner for the next presidential elections to be held in 2006. Is it your goal to be President of Chile? A: We are only halfway through the term of President Lagos. It's still too early to define [who the next candidate will be for the center-left coalition]. But if you ask me if a woman could be President of this country, I would say yes. With so many threats in the world of terrorism, people are looking for leaders who work well in teams, who exercise power in a more inclusive way, by sharing more than imposing. That's often described as a feminine style of leadership, although it can be exercised either by a man or by a woman. In any event, I believe that men and women are equally able to exercise that responsibility. If [being nominated for the presidency] were to happen, I would definitely have to consider it.

<a href=www.falkland-malvinas.com>MercoPress Tuesday, 10 June

Chilean President Ricardo Lagos and U.S.Secretary of State Colin Powell met in Santiago on Monday and managed to look past their differences over the war in Iraq.

The two discussed the Iraq war for the first few minutes of their 30-minute conversation at the La Moneda presidential palace while hundreds of demonstrators were outside protesting Powell's visit.

"We spent three minutes of the 30-minute meeting discussing Iraq and 27 minutes discussing the future, that's what we did," Lagos said afterwards.

Chile, as a temporary member of the U.N. Security Council, was a staunch opponent of the U.S.-led war in Iraq, but Washington's disappointment at that decision seemed to have already dissipated by the time Lagos and Powell met.

There was special concern at the meeting over the situations in Colombia and Venezuela, as well as governance in the region's still fledgling democracies.

Lagos explained that the two discussed hemispheric relationships, the advantages of geographic proximity and the challenges faced by the various countries in the region. The meeting was part of the 33rd annual meeting of the Organization of American States (OAS) general assembly, attended by foreign ministers and other delegates from 34 countries in the hemisphere.

On bilateral matters, Lagos and Powell agreed to focus on the free trade agreement signed by both nations on June 6 in Miami, and further agreed that they must pressure both countries' congresses to ratify the agreement so that it becomes effective in January 2004.

They also said the treaty is an "important step" towards solidifying the Free Trade Area of the Americas (FTAA), a hemisphere-wide trade pact that Washington would like to see in place by 2005.

Powell was greeted at the presidential palace by some 50 protesters, who were disbanded quickly by the police, screaming pro-Cuba and anti-U.S. slogans and carrying Cuban flags and signs with pictures of Cuban leader Fidel Castro.

Powell arrived in Chile Sunday night and said the United States is anxious to talk about the future and not the past," referring to the lack of support Washington received for the invasion of Iraq, particularly from Chile and Mexico, both of whom are rotating members of the U.N. Security Council.

"After all the time and attention that we spent on Iraq, the Middle East and elsewhere, we're looking forward to once again turning our diplomatic attention to our own hemisphere," said Powell.

Powell will leave Chile today Tuesday morning, but will stop in Argentina where he will meet with new Argentine President Nestor Kirchner.

SCOOP Tuesday, 10 June 2003, 10:16 am Speech: US State Department

Intervention at the Plenary of the General Assembly of the Organization of American States

Secretary Colin L. Powell Santiago, Chile June 9, 2003

SECRETARY POWELL: Madam Chairman, Distinguished Colleagues,

Twelve years ago, at the last general assembly in Santiago, our heads of delegation approved the Santiago Commitment to Democracy and the Renewal of the Inter-American System. The meeting set an ambitious agenda to promote and defend representative democracy and human rights.

We as a hemisphere have made much progress since 1991. The Americashave truly emerged from the shadow of authoritarian rule. As President Bush has stated, This hemisphere is on the path of reform, and our nations travel it together. We share a vision a partnership of strong, equal and prosperous countries, living and trading in freedom.

The Inter-American Democratic Charter we adopted nearly two years ago in Lima is the purest expression of our common conviction that democracy is the only legitimate form of government and that our people deserve nothing less.

Experience has shown time and again that freedom works, and political and economic freedoms work together, they work in concert.

Collectively, we have recognized that only a sustained commitment to political and economic liberty can help millions of poor people in our hemisphere lift themselves out of misery. But our distinguished host country has rightly called our attention to the fact that we have not completed the work that was begun here in 1991.

Our citizens know that free and fair elections alone do not guarantee effective, accountable government. Nor does an unfettered market alone guarantee sustained development.

We are here today to make sure that democracy delivers for the people of this hemisphere. Political democracy and economic opportunity come together in good governance. Respect for the rule of law, fairness, accountability in government and sound economic policies bring hope and opportunity equally to all.

Our Inter-American Democratic Charter is correct to declare that democracy and social and economic development are interdependent and are mutually reinforcing. By focusing our discussion on democratic governance at this meeting, the government of Chile has wisely placed the emphasis on what states can and must do to extend economic opportunity to all of their people.

New democracies created with high hopes can founder if the lives of ordinary citizens do not change for the better. Transitions can be chaotic. Transitions can be wrenching. We know that corruption will squander a nation's treasure and more importantly, it will undermine public trust. And extremists will feed on frustration and fears about the future.

That is why it is so important that we meet the goal set by our heads of state and government through the Summit of the Americas process to create by 2005 the Free Trade Area of the Americas. This Free Trade Area would create greater prosperity for nearly 800 million people in 34 countries of our hemisphere.

Free trade and open markets can bring investment and job-generating growth, if they rest on a foundation of fairness. Governments must be willing to put what resources they have in quality education, adequate health and nutritional care, basic sanitation, and personal security.

President Bush is determined to help countries across the globe struggling to do the right thing for their people. This February he presented his groundbreaking Millennium Challenge Account Initiative to the United States Congress.

As President Bush has said, the Millennium Challenge Initiative is a powerful way "to draw whole nations into an expanding circle of opportunity and enterprise." If fully funded, the initiative would provide the largest increase in US development assistance since the Marshall Plan. By 2006, it would represent an addition of 50% to our core development assistance funding of 2002. From 2006 onward, we would put $5 billion per year in the Millennium Challenge Account.

The Millennium Challenge Account would target only countries that govern justly, invest in their people and encourage economic freedom. Several countries in the hemisphere meet the basic income threshold to compete for Millennium Challenge Account funds during the first year of the program. And many more countries in the Americas are likely to do so in succeeding years.

Innovative bilateral efforts such as the Millennium Challenge Account Initiative are important. At the same time, regional cooperation is imperative, because so many of the domestic problems countries confront also have major transnational implications. Twelve years ago, the OAS didn't have the mechanisms for regional cooperation that were needed. Today, we do.

The Inter-American Convention Against Corruption and its follow-up mechanism immediately come to mind. Twelve years ago, it would have been unthinkable to suggest that the countries of the hemisphere should evaluate each other s efforts to combat corruption. But that is precisely what the convention provides for.

The increased effectiveness of the Inter-American Drug Abuse Control Commission is another case in point. Inherent in the commission's mandate is the consensus that drug abuse and drug trafficking threaten all of our societies and that we must work in concert to stop them.

After September 11, 2001, we worked together to reenergize the Inter-American Committee Against Terrorism. And our approval at last year s general assembly in Barbados of the Inter-American Convention Against Terrorism underscores our determination to protect our region against this vicious enemy that knows no limits, national or moral.

Regional efforts have played an important role in defense of democracy itself. As we all know, for over a year, Venezuela s democracy has been under serious strain. The United States welcomes the May 29 agreement reached between the Government of Venezuela and the opposition Democratic Coordinating Committee.

The Secretary General s tireless efforts were instrumental in this process, and we thank you.

Venezuelans must take responsibility for their own future, but we are committed to working with the OAS, the Group of Friends and others to bolster implementation of this agreement with practical support.

The people of Haiti have waited a long time -- too long - for their leaders to meet their obligations under OAS Resolutions 806 and 822. Haiti's democracy and economic growth are undermined by the government's failure to create the conditions for an electoral solution to the political impasse.

Led by the efforts of OAS Assistant Secretary General Einaudi and the OAS Special Mission, the international community has provided substantial support for strengthening Haiti s institutional capacity and civil society.

As a further sign of the commitment of the United States to this effort, I am pleased to announce that the United States will provide an additional $1 million to the OAS Special Mission to help improve the security climate for what we hope will be free and fair elections in Haiti. In addition, the United States has increased our humanitarian assistance to $70 million in the current fiscal year.

However, if by this September the government of Haiti has not created the climate of security essential to the formation of a credible, neutral and independent provisional electoral council, we should reevaluate the role of the OAS in Haiti.

The OAS has taken other important initiatives in support of democracy in our region. Member states raised their voices in unison to denounce the appalling terrorist bombing of a club in Colombia last February. We realize that the narco-trafficking attacks against the people of Colombia are a threat to all of us -- to our human and democratic values and to our shared interests in a secure and prosperous hemisphere. Colombia deserves our steadfast solidarity and our full support.

The people of Cuba increasingly look to the OAS for help in defending their fundamental freedoms against the depredations of our hemisphere s only dictatorship.

We deplore the crackdown of recent weeks against Cuban citizens seeking to act upon their basic human rights. We protest the harsh sentences that are being meted out to them.

The Inter-American Democratic Charter declares that the peoples of the Americas have a right to democracy. It does not say that the peoples of the Americas, except Cubans, have a right to democracy.

I commend the OAS members who stood by their principles and the Cuban people by supporting the recent declaration on human rights in Cuba on the floor of the permanent council. My government looks forward to working with our partners in the OAS to find ways to hasten the inevitable democratic transition in Cuba.

If our experience over the last quarter century in this hemisphere and across the globe has taught us anything, it is that dictatorships cannot withstand the force of freedom.

My friends; tyrants, traffickers and terrorists cannot thrive in an inter-American community of robust democracies, healthy citizenries and dynamic economies. President Bush remains deeply determined to working with fellow signatories of the Inter-American Democratic Charter to achieve our shared vision: a hemisphere of hopes realized.

Making hopes real is why the theme of this general assembly -- "a new commitment to good governance" is so timely and important.

Making hopes real is why each of our delegations need to pay special attention to the "Declaration of Santiago on Democracy and the Public Trust."

We must take concrete steps to keep freedom's hope strong among the people of our hemisphere. The citizens of the Americas expect to see results, sooner not later, they expect to see results from their democracies and from having market economies. We must not fail them. We must deliver. Thank you very much, Madame Chairman. [End]

Released on June 9, 2003

June 9 (<a href=quote.bloomberg.com>Bloomberg) -- Brazil's real gained for a fourth day in five on investors' expectations the government and companies will sell foreign currency bonds, keeping capital flowing to the country high even as bonds mature.

Brazil's real rose 0.4 percent to 2.8655 per dollar in Sao Paulo. Earlier, it gained 0.7 percent to 2.8550 after rising and fell as much as 0.2 percent to 2.8795. It has gained 24 percent this year, the best performer of 59 world currencies tracked by Bloomberg. Colombia's peso rose and Mexico's peso reversed declines to rise.

Brazilian banks and companies have contracted more than $6 billion of foreign currency bonds this year. Usinas Siderurgicas de Minas Gerais SA said today it plans to sell at least $50 billion of foreign bonds. In the last week banks such as Banco Banespa SA, a unit of Spain's Banco Santander Central Hispano SA sold more than $500 million of debt. Brazil's government may also sell.

```The rumors of a Brazilian sovereign sale are strong,'' said Marcelo Peregrino, who helps manage 25 million reais of bonds and stocks for Ativa SA, a Rio de Janeiro fund manager. ``The talk about the government selling a bond is helping the currency.''

The sales and planned sales are expected to help companies refinance the $1.5 billion of corporate bonds due between now and the end of July, Peregrino added. When Brazilian companies sell foreign currency bonds and convert the proceeds into reais, its increases demand for Brazil's currency, helping it gain against the dollar.

See-Saw Trading

In a day of see-saw trading that saw the real swing from a high of 2.8550 to the dollar to a low of 2.8795, gains were limited as some investors took advantage of last week's 3.2 percent rise in the real to buy dollars to pay for imports or make payments on foreign currency debts.

``I'm hearing people say that at current levels, it's a good time to buy dollars,'' said Carlos Gandolfo, a partner at Pioneer Corretora de Cambio Ltda., a Sao Paulo currency brokerage that handles about a third of all trades in Brazil's spot market.

Brazilian banks this Thursday must pay $550 million of foreign bonds. Of that, $300 million is owed by Banco Garantia, the Brazilian unit of Credit Suisse Group; $100 million by the Brazilian unit of Madrid-based Banco Santander SA and $150 million by Sao Paulo's Banco Votorantim SA.

Votorantim and Santander have both sold debt in the last week.

``There is a lot of maturing debt but beyond this, every week it seems we have someone else selling debt,'' Peregrino said.

The rough balance of maturing debt and new bond sales should keep the real in the 2.85 reais to the dollar to 2.95 reais to the dollar range for the next few weeks, he added.

Brazil's benchmark 8 percent bond maturing in 2014 fell a quarter cent to 91.38 cents on the dollar, boosting the yield to 10.11 percent, according to J.P. Morgan Chase & Co. The bond closed at a record high of 91.63 on Friday after earlier rising as high as 92.63 in intraday trading in New York and London.

Colombia

Colombia's peso rose for the sixth day in seven after Finance Minister Roberto Junguito's resignation Friday led to the designation of his deputy to assume the post, allaying investor concern about continuity of the country's economic policy.

The peso gained 0.5 percent to 2,814 per dollar in Bogota, and the benchmark 10 percent bond due January 2012 rose for a sixth day, adding 0.1 cent on the dollar to 114.35, paring its yield to 7.69 percent, according to J.P. Morgan Chase & Co. The yield has declined from a high of 14.46 percent on Sept. 19.

Colombian President Alvaro Uribe replaced Junguito with Deputy Finance Minister Alberto Carrasquilla, 44, a former technical vice director at the central bank. Carrasquilla, who said he would continue the economic policies undertaken by Junguito, will be sworn in June 20.

``It's clear the economic program is going to continue on the same track and at the same pace without skipping a beat,'' said Jose Cerritelli, an analyst at Bear, Stearns & Co. in New York.

Growth Course

Junguito, a former Colombian representative to the International Monetary Fund, was instrumental in signing a $2.1 billion, two-year standby loan accord with the IMF. He also helped push key pension, tax and labor bills through Congress aimed at cutting deficit spending and boosting growth.

Junguito felt he'd completed his mission,'' said Alvaro Camaro, head of research at Acciones y Valores SA brokerage. He got the accord with the IMF and he pushed through the key reforms.''

The government on Friday announced that industrial output, excluding coffee processing, rose 15.3 percent in March from the year- earlier month, the national statistics agency said in Bogota. Industrial sales rose 14.8 percent.

Accelerating industrial output may help the economy maintain its momentum after growing 3.8 percent in the first quarter, the biggest gain in the gross domestic product in five years.

Interest rates near historic lows have helped boost the construction industry, raising demand for metal products and other items used in building and helping create jobs.

Regional Currencies

Chile's peso fell for the fourth day in five, sliding 0.4 percent to 717.05 per dollar, paring its gain in 2003 to 0.5 percent.

Mexico's peso reversed declines to rise for the second day in three, adding 0.7 percent to 10.6560 per dollar, paring its decline in 2003 to 2.7 percent, the worst performance among the 16 most widely trade currencies.

Argentina's peso rose 0.6 percent to 2.8125 per dollar, boosting its gains in 2003 to 19 percent, the second-best performance among 59 currencies tracked by Bloomberg worldwide.

Peru's new sol was little changed at 3.4825 per dollar from 3.4818 on Friday. Venezuela this year fixed its bolivar at 1,598 per dollar.