MercoPress. South Atlantic News Agency

South America Breaking News

Some Headlines: Radioactive alert in Santiago; Multi purpose vessel for Uruguay; Lagos optimistic; Meat summit in Uruguay; Argentines pessimistic; Less frozen, but still cold

Punta Arenas under snow

The greatest snow storm in 44 years has left Punta Arenas covered with an average two feet of snow, in some places up to a meter, forcing local authorities to cancel all road and air transport to the city. An Emergency Council operating from Town Hall decided the suspension of school classes this Monday and has recommended people to remain at home, since forecasts indicate that the heavy snow storm of the weekend is expected to continue. Punta Arena's mayor, Juan Morano working with Public Works gangs and teams of Fire Fighters has been looking round the city to assess the magnitude of the climatic phenomena. Carlos Ibañez airport activities have been cancelled until further notice, as have as all long distance bus companies frequencies. Apparently over 300 passengers are stranded in Puerto Montt because of the closure of Punta Arenas airport. Telephone lines with Puerto Natales are working but contact with Puerto Williams is only possible by radio.

Poultry influenza

Chile's Poultry Association, APA, publicly announced this Sunday in Santiago the destruction of thousands of chickens affected with the virus of chicken influenza in the Fifth and Sixth Regions of the country. APA president Jan Miguel Ovalle added that in the coming days the association will have the full laboratory results of the virus outbreak detected in different regions of Chile. "The poultry industry has given a clear signal of their responsibility and commitment with sanitary conditions in the country. The sacrificing of chickens in several poultry farms has been done in accordance with routine procedures established by sanitary authorities and should help us preserve the sanitary status of the country", underlined Mr. Ovalle. In a release published in several newspapers APA indicates that the "poultry industry will proceed to work in co-ordination with the sanitary board of the Ministry of Agriculture and Livestock, keeping the community fully informed once we have the lab results". Certain virus of poultry influenza and be linked to strong strains of human influenza.

Radioactive alert in Santiago

Chilean sanitary authorities and law enforcement officers have alerted the population of Santiago about the robbery of a nuclear density caliber from a local building company, warning that the inadequate manipulation of the tool could free extremely harmful doses of radioactivity. Apparently last week seven common robbers assaulted the offices of the building company stealing computers, printers, water pumps and other tools, including the sophisticated instrument. Metropolitan Santiago Environmental Safety and Health officials are most preoccupied that the density caliber could be wrongly disassembled, broken, cut up, founded or merely perforated, allowing the inside radioactive nucleus to escape with serious risk for human life and the environment. Officials recalled that only a year ago several people died in Brazil after having been exposed to the inadequate manipulation of a similar equipment which is generally used to gauge density and humidity in compacted soils. Santiago Police is in full alert and the media is constantly broadcasting the dangers involved in the manipulation of this type of equipments.

Blame it on Rita

Brazilian left wing candidate Luiz Inácio da Silva "Lula" still leads vote intention for the October presidential elections with 40%, while the ruling coalition candidate Mr. José Serra has begun to recover and has moved to second place with 20%, according to the latest poll "Vox Populi" published over the weekend. Apparently two factors have had a encouraging impact for Mr. Serra's candidacy which never seemed to really take off. One is the naming of a popular and attractive lady legislator, Rita Camata, 41, as vice-president candidate. Ms. Camata belongs to the strongest Brazilian center right party, PMDB, (Brazilian Democratic Movement), and is considered an excellent choice by Sao Paulo political analysts. Mr. Serra's Social Democratic party also started an aggressive electronic media campaign. "Definitively Ms. Camata will reinforce the lagging campaign of Mr. Serra: she's very charming, articulate and passionate about her ideas", remarked David Fleischer a Brasilia University political science expert. The latest poll was done May 29/30, interviewing 2,001 potential voters with a 2,2% margin of error. Mr. Lula still leads comfortably with 40% of vote intention, but this represents a two points drop from mid May when he reached 42,2%. However in a second round Mr. Lula would eventually defeat Mr. Serra by 50% to 36%. In the mid May poll, Mr. Serra actually had dropped to third place, behind Anthony Garotinho, a former populist Rio do Janeiro governor who is supported by the evangelist (non Catholic) churches of Brazil.

Iron range bid

Bolivia has convened an international competing bidding process for the exploitation of one of the world's largest iron reserves in the Mutún range, close to the Brazilian border. Mineral deposits cover an area of 60 square kilometers and are calculated in over 40 billion tons, half of which is top grade iron with a high content of phosphorus. The terms of the international bid were published in the Bolivian press this weekend and released through Bolivian embassies in those countries with strong interests in the mining industry. Basically it will be a 40 years concession on a shared risk-contract with the Bolivian government. A German consulting firm, DTM, is in charge of the bidding procedure. Deadline, July 25th. Bolivian Mining Ministry sources indicated that an initial 300 million US dollars investment is needed to commence the project. Among the companies interested figure, Techint from Argentina; Lurgi, Germany; Sidersul, Brazil; Rio Tinto, United Kingdom; Fermy Investment a joint Bolivian-Argentine-American association. The railway company that covers east Bolivia, Genesse-Wyoming, has began surveys for the possible laying of a line from the Mutún area to Puerto Busch in the heartland of Brazil, the famous Paraná-Paraguay waterway, which links with the River Plate.

Peru plants for the future

Peru expects to put an end to the privatization and public utilities concession process by 2005, according to the 2003/2005 Macroeconomic Framework approved by the Peruvian cabinet last week. In that period Peru expects to collect 1,2 billion US dollars and investment equivalent to 3 billion US dollars mainly through concessions. The document was made public in the internet portal of a local Lima broadcasting station, including budget estimates, revenue and capital expenditure for the coming fiscal years, plus the domestic and international context supporting the figures. Aims of the program are a sustainable long term growth that helps reduce unemployment and poverty, with a low inflation rate and an adequate level of international monetary reserves. The private sector will be given the necessary provisions to act as the "locomotive" of the Peruvian economy. Growth estimate for the current year is 3,5% and an average 4,8% for the rest of the program ending 2005. In 2005 Peruvian "per capita income should have reached the historic peak of 1981". Fiscal policy will be "prudent" aiming for a consolidated 2002 budget deficit of 2,2%, dropping to 0,8% by 2005. The budget contemplates an important effort in "social investment", nutrition, health, education, home building, Justice and transfers from Lima to the poorest and most depressed areas of the country. Although rich in resources Peru has a very unfair wealth distribution system dating back to the Spanish conquest, burgeoning urban population mostly Indians most of which live below the poverty line. Political instability and military intervention have been a constant of recent history. The economic program was made public when a majority of residents in Lima and El Callao believe the current political situation of the country is unstable and favor giving the ten months old administration of President Alejandro Toledo, a six months truce. According to a poll from the University of Lima, 57,1% of those interviewed said the political situation of the country was unstable; 27% entirely non-stable and only 13,3% stable. The poll was taken May 25/26 involving 473 people from all socio-economic background with a 4% margin of error. An ample majority, 62,7% said it was time to give the Toledo administration breathing space, while 30% are against any truce at all. As to the economic situation, 57% of Lima and Callao residents interviewed said it was very bad; 36,6% hardly bearable and 4,9% very good. Looking into the future, 30% are pessimistic about economic conditions; 27,9% believe they will remain unchanged and 27,5% feel they will improve.

Multi purpose vessel for Uruguay

Next July the Uruguayan Navy will be incorporating a German built multi-purpose vessel specifically improved for continental shelf research, that will also be used for fisheries patrol, rescue operations, Antarctic supplying and fighting fires in the high seas. The "Norderney", belongs to the Wangerooge Class of the German Navy; she was built in 1970, is 52 meters long, has a 5,000 miles autonomy, works with a crew of 24 and was acquired in 475,000 US dollars. However "Norderney" main task with the Uruguayan Navy will be to continue surveying the continental shelf in the framework of United Nations Law of the Sea legislation that will enable coastal countries to extend their underwater domain. In Uruguay's case jumping from the current 153,000 square kilometers to a potential 256,000 sq. km. The Uruguayan hydrographic project is being done in cooperation with the Geophysics Institute of Trieste, Italy, that next April 2003 is scheduled to send a scientific research vessel, "Explora" to help with all the morphological surveying in combination with the "Norderney". The first stage of continental shelf surveying was done by another German built vessel belonging to the Uruguayan Navy, "ROU Oyarbide". "Norderney" currently in Cuxhaven in the near future will be replacing "ROU Campbell" an old US Navy converted mine sweeper to be decommissioned next November that usually operates in fisheries patrol and supplies Uruguay's Antarctic installations.

Lagos optimistic

President Ricardo Lagos said he's optimistic Chile will reach a "developed country" status when the bicentennial celebrations, and highlighted the achievements of the ruling coalition since recovering democracy in 1990. In a long interview with the Sunday editions of El Mercurio, Mr. Lagos pointed out that although the country's economic growth has slowed down, compared to the 7% average in the nineties, and money is retreating from the emerging markets, the recent free trade agreement with the European Union has made Chile attractive and "we can count on strong foreign investment". "We still have some fiscal details to iron out but Europeans now know they can trust Chile to become the launching pad for their investments in the rest of Mercosur and the continent", indicated President Lagos. Mr. Lagos underlined that the Chilean economy has grown 8 points since he took office (2000) and has doubled under the current ruling coalition that took over from the previous military government in 1990. "It's not an easy neighborhood, if Chile belonged to Europe it would be much easier", underlined Mr. Lagos, recalling that the country still has over half a million Chileans unemployed, over three million below the poverty line and 850,000 indigents. "But anyhow by investing heavily in social areas we have managed to cut the cut the number of Chileans below the poverty line from 40% to 20% of the population", added Mr. Lagos. "Eliminating poverty is my greatest task and challenge, but for that we need a strong economy growing at double the current 3%".

"Protectionism as tall as the Andes"

Uruguayan president Jorge Batlle interrupted a conference in the Uruguayan-British Chamber of Commerce when the speaker began praising the virtues of the Chilean model of open economy with minimum tariffs, recalling that "they are one of the more protectionists in the universe when it comes to agriculture". "Chile might have an enviable flat minimum tariff but when it comes to agriculture it turns into a mountain as high as the Andes", said President Batlle interrupting Alejandro Vegh Villegas, a former Uruguayan Finance Minister and former Ambassador in the United States, who was the main speaker at the annual gathering of the Uruguayan-British Chamber of Commerce. John Everad, British Ambassador in Uruguay and Stella Zervoudaki European Union Ambassador in Montevideo were present at the event. "Chile's success is something different in Latinamerica, and its unique success is based on the fact it has followed an independent policy, unilateral, leaving aside many of the recommendations of the international multilateral institutions, and has imposed a Customs tariff system which is one of the best in the world, uniform, without any dispersion, that now stands at 6%", said Mr. Vegh Villegas adding that with the agreement with Canada and recent signing with the European Union Customs tariff will drop to 3,5%, flat, free of corruption and free of inefficiencies, "and this is something I've always wanted for Uruguay". It was then that President Batlle contradicted Mr. Vegh Villegas saying the tariff was not at all flat, "even in good countries there are horrible things; when we tried to fully incorporate Chile to Mercosur they requested 14 years to adjust and improve their agriculture tariffs, fourteen years?.". "They follow the European model" replied Mr. Vegh Villegas. "Yes, unfortunately, yes, and that is why they reached an agreement with the Europeans so quickly. They both protect very much their farmers", remarked president Batlle. Mr. Vegh Villegas also gave a very dismal prospect for Latinamerica and its influence in the world. "In the last twenty years per capita average growth in Latinamerica and the Caribbean has been 0,35%, so to double it we will be needing 200 years".

Meat summit in Uruguay

The Meat International Permanent Office, OPIC, is scheduled to hold its regional summit next March 2003 in Punta del Este with the participation of experts from United States, European Union and Australia who have been specially invited to the conference. The regional summit was decided in OPIC's world Congress held early this year in Berlin and the agenda will focus primarily in organic production of beef and lamb. OPIC is a private organization whose membership includes representatives from farmers, industry, marketing and commercialization. The previous world congress was held in Dublin in 1999 and an extraordinary gathering took place in 2000 in Belo Horizonte, Brazil. Some of the issues that will be discussed in the March meeting are, "Meat market situation in the framework of the current international trade negotiations"; "Animal health and access to markets"; "How to conquer consumers trust"; "World prospects for meat production, consumption and trade". Finally there will be two full days dedicated to organic meat production with extensive field work in Uruguayan beef and lamb farms.

Record crops in Brazil

Brazil is heading for another record breaking crop year of almost 100 million tons according to the Brazilian Geographic and Statistics Institute, IBGE. The previous record was last year, 2001, with 98,5 million tons, and this year that volume should increase 1% and reach 99,3 million tons. The crop estimate includes all cereals, leguminous and different oil seeds. Among the crops with the greatest increase are beans with 20,47%, (Brazilians staple food), and wheat with 18,77%. However Brazil is still an important importer of wheat from Argentina, Canada and the United States. According to analysts the success of Brazilian agriculture that represents 7,8% of the country's GDP, is based on cheap labor, sophisticated state of the art technology with a constant increase in productivity, the devaluation of the currency and the incorporation of more farmland. FAO estimates that between 1969 and 1999, farmland in Brazil grew 34% from 187 million hectares to 250 million, equivalent to 20% of the world's farmland.

Less frozen, but still cold

Argentine businessmen associations reacted cautiously to the latest plan of the Duhalde administration to alleviate the strict restrictions pending over bank deposits frozen since last December and a permanent source of protests from stranded depositors and bankers. "The voluntary exchange of frozen deposits for bonds can help the economy, but will limited to the car and building industry", indicated Mr. Alberto Gianini from the Food Products Association. However he also admitted that not much more can be done otherwise the "whole financial system will collapse". Last Friday president Duhalde signed a package that offers different options of bonds for the frozen deposits, including some that can be readily converted for the purchase of cars, housing or canceling bank debts. The package however needs Congressional approval for its implementation. Francisco Dos Reis president of an organization of small and medium enterprises admitted there could be "some activity improvement", but the fact remains there is no credit for any industry, "and without credit it's virtually impossible to operate". Regarding IMF assistance businessmen were even more cautious, "an agreement will be reached, but only in the accounting books, it's hard to see much, if any fresh money coming to the country from the IMF". Part of the latest attempt to "liberate" frozen deposits includes a special compensation of 9,5 billion US dollars to the Argentine banking system, in the form of a ten years maturing bond (2012). When the current Duhalde administration took office last January and decided to devalue the Argentine currency, US dollar deposits were converted at the rate of 1,40 pesos to the dollar, while bank credits and loans one to one. Since then the Argentine currency has lost 70% of its value and now stands at 3,60 pesos to the US dollar, after ten years at the pegged rate of one peso-one dollar. The 2012 bond is geared to cover the losses experienced by banks.

Argentines pessimistic

Most Argentines doubt there's a quick solution to the current crisis and recession, according to a poll published by Clarín. Actually 76,2% of those interviewed believe a solution is "very distant" and only 16,9% consider a way out to the crisis can be found in the short term. However as to the depth of the crisis, opinions are split almost equal, 51,9% believe the situation has reached its lowest point while for 46,9% "the worst is still to come". As far as those responsible for the situation, former president Carlos Menem who ruled from 1989 to 1999 tops the list, followed by political corruption, the former president De la Rúa administration 1999/2001 and the ineptitude of politicians in general.