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Wednesday, December 25th 2002 - 20:00 UTC
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Headlines: Argentine Central Bank halts dollar transactions; Foreign investment in Chile down 62 percent; Venezuelan strike pushes up prices of Ecuadorian crude; Court Releases Argentine Media Tycoon.

Argentine Central Bank halts dollar transactions

The Argentine Central Bank has announced a measure that will, in practice, force individuals to buy or sell dollars at banks and exchange houses only.

The Central Bank announced Tuesday in a press release that it would indefinitely suspend all trading in dollars beginning Dec. 26. Since January, when the government ended the decade-old currency regime that pegged the peso at parity to the dollar, exchange houses selling dollars at prices set by the Central Bank have existed alongside those that trade the U.S. currency at free-market prices. The suspension will go into effect at a time when dollar-exchange rates on the free market are virtually on par with those offered by the Central Bank. On Monday, the exchange rates offered by banks and exchange houses were lower than those at the Central Bank. The Central Bank, meanwhile, will continue its normal operations in the wholesale market and reserves the right to intervene in the market when it deems necessary. The peso lost almost two-thirds of its value following the January currency devaluation, although the price of the dollar has held steady, trading at about 3.5 pesos.

Foreign investment in Chile down 62 percent

Year-to-date foreign investment in Chile shrank by around 62 percent through the end of October, according to information released Wednesday by the Foreign Investment Commission.

Foreign investments over the first 10 months of 2002 totalled $1.6 billion, a far cry from the 2001 total of $5.5 billion, commission deputy chairwoman Karen Poniachik told Television Nacional. The decline is in line with a global trend marked by a drastic reduction in mergers and acquisitions, she said. "This phenomenon is not limited to Chile, but rather is a global trend, with the exception of China," said Poniachik, who added that investments are down some 60 percent in the top 30 industrialized nations. Investments in Chile picked up somewhat in November due to the sale of La Disputada de las Condes copper mine for $1.3 billion. Poniachik was optimistic about the coming year because of the free-trade agreements Chile has signed with the European Union, United States and South Korea.

Venezuelan strike pushes up prices of Ecuadorian crude

Venezuela's 24-day general strike has raised the price of Ecuadorian oil for export by nearly 20 percent, the press reported Wednesday, citing figures from state-run oil company Petroecuador.

The price per barrel of Ecuadorian crude has risen steadily since the strike began on Dec. 2, when it was fetching $21.82. On Tuesday it closed at $25.80, La Hora daily reported, citing Petroecuador figures. The strike at Venezuela's state-owned oil company PDVSA is a major factor behind the higher prices for Ecuadorian oil, Petroecuador International Trade manager Vicente Espin said. Espin, nonetheless, does not believe crude prices will reach upwards of $40-$50 per barrel, as forecast by some analysts. Venezuela sells most of its oil to the United States, as does Ecuador to the tune of 130,000 barrels each day. Oil is the Andean country's main export commodity. For the 2002 budget, Quito estimated an average price of $19 per barrel.

Court Releases Argentine Media Tycoon

The president of Argentina's largest media conglomerate has been released from detention while a judge investigates whether she illegally adopted children born to captive dissidents during the 1976-1983 military dictatorship.

Ernestina Herrera de Noble, 77, was detained for six days until a federal appeals court on Monday ordered her release. She spent the first two days in jail before a judge approved her transfer to house arrest, in deference to her age. Herrera de Noble's media holdings include Clarin, Argentina's largest-circulation newspaper. Her detention was prompted by a criminal complaint filed by Grandmothers of the Plaza de Mayo, a human rights group tracking the whereabouts of children believed to have been born in clandestine detention centers during the military's reign. Investigators want to determine whether the two children adopted by Herrera de Noble were born to dissidents jailed during the dictatorship, judicial sources and police said. Horacio Verbitsky, a lawyer and journalist advising the rights group, said the two children, now in their 20s, were expected to undergo DNA testing. Judges have been investigating whether a systematic plan existed for the illicit adoption of more than 200 children born to those held captive during the military's "dirty war" against leftists and political opponents. The children's mothers are among at least 9,000 Argentines who vanished during the campaign. Human rights groups say the total is closer to 30,000.

Categories: Mercosur.

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