MercoPress. South Atlantic News Agency

Uruguay: Botnia speeds up work

The Finnish firm Botnia is planning to hire some 2,000 new workers in the coming weeks, as it speeds the construction of a mammoth paper pulp plant in the Uruguayan town of Fray Bentos, a news report in Montevideo said yesterday.

Botnia and the Spanish firm ENCE are building two wood processing plants on the coast of the River Uruguay that serves as the natural border between Argentina and Uruguay. The projects have sparked a diplomatic rift between the two countries because Argentina fears the plants will harm the environment.

Montevideo's daily El País reported yesterday that hundreds of people are moving to Fray Bentos, as Botnia is entering the second stage of its construction plans and has announced the hiring of some 2,000 people to reach a staff of 4,500 workers by August. Botnia, the report adds, hopes to become operational by August 2007.

Argentina has lodged a complaint before the World Court based in The Hague on grounds that the construction of the mills violated a bilateral river agreement signed in 1975. On June 8-9, during the first hearings in the case, the Argentine delegation requested the court to order construction stopped while further environmental studies are conducted. The World Court is expected to rule on that request next month, while it might take four to five years to rule on the core of the dispute.

Uruguayan Foreign Minister Reinaldo Gargano, meanwhile, said yesterday that his country was willing to work on a political agreement to solve the pulp conflict with Argentina but ruled out the possibility of changing the location of the plants.

"The possibility of moving the plants somewhere else is ridiculous. If they pollute here they would also pollute somewhere else. The problem is to control them so that they don't pollute," said Gargano. The foreign minister insisted on Uruguay's willingness to jointly monitor the plants with experts appointed by the Argentina.

The spat over the paper mills has fuelled political tension within the Mercosur trade bloc, which Argentina and Uruguay form along with Brazil and Paraguay. Uruguay has complained that the Mercosur has proved incapable of resolving the paper pulp friction.

Argentine and Uruguayan government officials have sought to cool down the diplomatic dispute in the last few days. Argentina is next month hosting a Mercosur presidential summit in the central province of Cordoba and there is speculation presidents Néstor Kirchner and Tabaré Vázquez could meet to discuss the pulp mills situation.

Brazilian Foreign Minister Celso Amorim said in an interview with the daily Clarín yesterday that the row over the mills was not a major problem for the bloc. Buenos Aires Herald