Caracas, June 18 (<a href=quote.bloomberg.com>Bloomberg) - Venezuela promised to pay $55 million owed to 43 Colombian companies within two weeks, part of a program to speed up late payments to the neighboring country's exporters, El Nacional reported.

Venezuelan Foreign Minister Roy Chaderton said that the payments will be completed, fulfilling an April 23 promise by President Hugo Chavez.

Colombian companies say they are owed as much as $300 million by Venezuelan customers, with 50 Venezuelan companies accounting for 80 percent of the money owed.

Colombian companies have complained that their payments have been frozen because of Venezuela's system of foreign exchange restrictions, which have choked off sales of dollars to Venezuelan importers. Venezuela imposed currency restrictions in January to arrest a decline in international reserves.

(EN 6/18 B1) To see El Nacional's Web site, click on {NCNL}

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.

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Wednesday, June 11, 2003 By: Jose Gabriel Angarita

VenAmCham economist Jose Gabriel Angarita writes: Since January 21, the date on which restrictions were placed on Venezuela's foreign exchange market, it has been impossible to perform overseas credit card transactions. But CADIVI President Edgar Hernandez Behrens announced that the lifting of that restriction is under consideration: "we are doing studies and analysis of proposals, which are quite far along;" "now only a few important details remain."

This action by the foreign exchange regulatory body could imply a relaxation of the exchange control system in the near future ... though it would retain its current form and there would be no legal parallel market to satisfy the massive repressed demand.

Discussions in VenAmCham's economic department indicate that access to foreign exchange will increase after June has passed, but there is no clear indication as to whether the current system will be modified or kept in place as is, only with a lower level of discretionality.

Most sectors of the national economy are aware of the distortions to which a managed economy is subject. Proof of that is the statement by Central Bank Director Domingo Maza Zavala, who explained that "every surplus dollar in the foreign reserves represents the amount being withdrawn from economic activity, and that does not help the productive sectors to revive."

In the absence of a rapid relaxation of the restrictions on the foreign exchange market so that resources can be allocated to the different sectors of the national economy, the political punishment interpretation of the controls will continue gaining strength.

The upshot, however, will not only be harm to a particular economic sector or group, but to all the participants in the economic system, and especially the consumers, due to rising unemployment and product shortages.

Everything will depend on the changes that CADIVI may make in its mode of operation, to improve current conditions. If it makes no changes, the economic consequence may be a further intensification of the unprecedented contraction we have seen in recent months.

<a href=www.vheadline.com>Venezuela Electronic News, Venezuela - 11 Jun 2003 Venezuelan Foreign Exchange Administration Committee (Cadivi) has announced that it is currently drawing details to regulate the use of credit cards abroad ...

Reuters, 06.05.03, 5:37 PM ET CARACAS, Venezuela, June 5 (Reuters) - Venezuela's Supreme Court on Thursday rejected a lawsuit that sought to suspend the state's tough currency controls, but the tribunal must still rule on whether the curbs are unconstitutional. The government introduced the foreign exchange regime four months ago to halt capital flight and a slide in the local bolivar currency after a two-month opposition strike failed to oust President Chavez but sent the economy reeling. A group of lawyers, some representing business clients, have introduced several petitions in an attempt to have the control system declared unconstitutional. "This means that (the court) has rejected the petition to suspend the effects of the currency controls while they decide on whether they are constitutional," one attorney, Henry Pereira, told Reuters by telephone. The control regime, which followed the shutdown of the foreign exchange market from Jan. 22, has been criticized by private sector representatives and even government officials for its slow allocation of dollars to an economy that relies on imports for 60 percent of its consumer goods. A central bank director, Armando Leon, warned Wednesday that the economy of the world's No. 5 oil exporter would sink deeper into recession if the currency board kept its tight strangle hold on the access to U.S. currency. Joining the chorus of criticism of the currency controls, the Venezuelan-German Chamber of Commerce and Industry Wednesday called on the government to ease the curbs to help companies already struggling with the recession. Venezuela's gross domestic product (GDP) slipped nearly 30 percent in the first quarter of 2003 as it was battered by the strike that choked off vital oil output and squeezed by the drought in dollars caused by the currency curbs. While the government argues it has managed to bolster international reserves and the investment image of the country, opposition and private sector representatives say the curbs have worsened the economic crisis, increased unemployment and driven up inflation.