Santiago Times for June 14, 1999 Via NY Transfer News Collective * All the News that Doesn't Fit Santiago Times for June 14, 1999 * HEADLINE: CARAVAN OF DEATH INDICTMENTS SPARK DEBATE Rumors Of Political Deal-Making Both Denied And Confirmed KEYWORDS: HUMAN RIGHTS; POLITICS; MILITARY SOURCE: LA TERCERA SOURCE: EL MERCURIO TEXT: The human rights legacy of the 17-year military government led by retired Gen. Augusto Pinochet took center stage this weekend, with politicians and military brass scrambling to set the parameters for debate on the issue. As never before since Chile's transition to democracy began, top military officials have given indications of their willingness to work towards discovering the remains of the more than 1,000 individuals "disappeared" during the Pinochet regime, but only in exchange for an end to the human rights cases that continue slowly working their way through Chile's legal system. The intense, new focus on the human rights concerns was touched off by the indictment last week of five Army officials for their role in the so-called Caravan of Death operation, an expedition led by (ret.) Gen. Sergio Arellano Stark in September and October of 1973 - on direct orders by Pinochet - and which resulted in the summary execution of more than 70 prisoners of war. New, additional indictments against military personnel are also expected later this month in other high-profile human rights cases such as the Operation Albania case and the Tucapel Jimenez case. As a result of the indictments, Army Commander-in-Chief Gen. Ricardo Izurieta last week called for a national accord on human rights issues, while Navy Admiral Jorge Arancibia said locating the remains of the disappeared is the sine qua non for any resolution to festering human rights concerns. Right presidential candidate Joaquin Lavin also contributed to the debate, saying that not only should the remains of the disappeared be located, but that the circumstances surrounding their deaths also must be clarified. Additionally, several news media reported Saturday that Pinochet himself was in favor of new negotiations to put human rights issues to rest, a report that Pinochet vigorously denied Sunday in London. The weekend was also rife with rumors about secret conversations between politicians on the right and left to reach an agreement that would not only respond to military concerns about human rights against them, but also to constitutional reforms concerns that have been an ongoing part of the agenda for the governing Concertacion alliance since coming to power in 1990. The reforms most sought by the Concertacion are an end to the designated senator positions (which include four former commanders-in-chief of the Armed Services) and a lower profile for the military in the National Security Council - both considered unacceptable instances of military intrusion in the country's democratic institutions. While Concertacion politicians have repeatedly denied that any deal is afoot, a top spokesman for the rightist Independent Democratic Union (UDI) party Sunday night confirmed in an interview on national television that discussions have been on-going for some time. UDI Sen. Andres Chadwick refused, however, to name the Concertacion representatives involved or to give any details concerning the talks. The official position of the Concertacion and its presidential candidate Ricardo Lagos has been that the courts should be allowed to go forward with their work and that a full accounting of the location of the disappeared must occur. "The disappeared are not negotiable," said Socialist Party (PS) leaders Sunday, who denied they are part of any conversations with the right. "Human rights are not negotiable... or subject to deal- making that would lead to political reforms... We want to categorically deny the existence of any discussions or contacts (on the human rights issue) that involve our party." Still, the PS said it greatly valued Lavin and the Navy's call for renewed efforts to locate the disappeared. "It is important that (Admiral Arancibia) did not use threatening language, but rather spoke of dialogue and the need for the Armed Services to give information and to break the pact of silence, which should never have occurred." Party for Democracy president Sen. Sergio Bitar, however, had a different take on the political right's renewed interest in human rights issues. "The right always shows itself disposed to talk about human rights during elections, but then later they take it all back," he said. * HEADLINE: CURRENT EVENTS BRIEFS KEYWORDS: POLITICS; ECONOMY; INTERNATIONAL; ENVIRONMENT SOURCE: EL MERCURIO SOURCE: LA TERCERA TEXT: Today's other headline stories in brief: -- HEAVY RAINS COULD STAVE OFF FURTHER ENERGY CUTS. Heavy rains and high winds swept across southern Chile over the weekend, causing widespread disruption but also raising hopes that rising water levels in major reservoirs could lead to increased hydroelectric generation to meet the current energy deficit in the Central Interconnected System (SIC) power grid. Programmed power outages have been in effect in the SIC since last Wednesday, although cuts were suspended over the weekend in Santiago due to the typical decrease in energy consumption on Saturday and Sunday. But authorities said two-hour cuts resume Monday. However, the heavy rains across southern Regions VIII, IX and X have raised expectations of an interim solution to the power rationing, and meteorologists predict precipitation could continue into south central Region VII. Energy companies are hoping that major reservoirs will be swollen by the continuing rains, as both are currently at critically low levels, although they add that more rain is needed to make an impact on the energy deficit in the SIC. But whilst the rains were welcomed by energy companies and farmers, some 150 families in Almue, near southern city Puerto Montt, were left homeless after winds of up to 90 kilometers per hour and some 55 millimeters of rain in little over a day left houses severely damaged. Southern island Chiloe was also hit by fierce winds and high seas, leading to power cuts in some parts, and southern cities Valdivia and Temuco also suffered damage. But ski resorts near Temuco welcomed the snow, announcing that as a result they would be opening to the public at the end of the month. -- ALVEAR PLEDGES TO STEM RISE IN CHILD ABUSE. Justice Minister Soledad Alvear Sunday announced tougher penalties for people caught smuggling children for financial gain after pledging Friday to introduce new measures to stem the rising numbers of children involved in the sex trade in Chile. Alvear first spoke at the First National Conference on Violence and Sexual Exploitation of Children held in Santiago Friday, and her comments came in the wake of recent estimations by experts that there could be as many as 10,000 minors between six and 18 involved in the sex trade in Chile. The figures are the result of studies carried out by the United Nations Children's Fund (Unicef) and the Chilean National Minors' Service. The two institutions recently carried out a joint survey and estimated there were some 4,200 children pressured into working in the sex trade by third parties, but Unicef now says the figure could be nearer 10,000. Unicef psychologist Soledad Larrain said the child sex business has boomed in recent years due to improved communications like the Internet and cellular telephones, which are harder to trace than traditional methods, and increasing preference on the part of adult users for younger prostitutes, to avoid the risk of contracting AIDS. But Larrain noted the figures were well below those of Brazil, which has around 500,000 children working in the sex trade; India, with 300,000; and Costa Rica, with 140,000. The news comes as fears of a widespread child trafficking network in Chile were raised after two women were indicted for trying to smuggle a child out of the country for adoption abroad. Judicial sources said the case was "just the tip of the iceberg" and that an illegal adoption ring was operating in the country and it had already made over US$1 million. Alvear said Sunday the new Adoption Law will drastically increase the severity of punishments handed out to people caught smuggling children out of the country for financial gain. -- MISSING CHILD APPEARS IN COLONIA DIGNIDAD CASE. Rodrigo Salvo, the child who went missing two years ago after entering the former Colonia Dignidad German enclave, unexpectedly appeared Saturday, one day after the Talca Appeals Court indicted two members of the German colony for his abduction. Also indicted as accomplices were the child's father and another Chilean. Although the exact circumstances of Rodrigo Salvo's reappearance are still unclear, it seems that lawyers representing the colonists made initial contact with authorities. But legal sources noted the boy had not yet been put under the court's protection, and thus worries over his wellbeing continued. Police officials said 15-year-old Rodrigo Salvo could also shed crucial new light on the whereabouts of Paul Schafer, the former leader of Colonia Dignidad who is currently on the run from police after being indicted on charges of child abuse. Friday's ruling was described as a major turnaround in the case, as the court had previously resolved to investigate seven colony members only for the minor offense of refusing to hand over the child, thus allowing the suspects conditional freedom under bail. But the new ruling, made after the child's father, Pedro Salvo, was arrested May 18 after evading police for three months, means that the suspects must remain in custody. The men accused of abducting Rodrigo Salvo are the Germans Gunther Schaffrick and Wolfgang Zeitner and as accomplices, Pedro Salvo and Diego Soto. Prosecuting lawyer Hernan Fernandez described the ruling as "the tip of the iceberg", and said it could open the way for many other colony members to be prosecuted for the same crime. Colonia Dignidad was allegedly used as a torture center after the 1973 coup led by former military leader Augusto Pinochet. Rodrigo Salvo first entered Colonia Dignidad in January 1996, and when his mother heard rumors of systematic child abuse in the enclave she tried to remove him. But the colony members said his father, Pedro, had taken him away from the colony in 1997. -- INSULZA MENTIONED AS POSSIBLE WTO HEAD. Chilean Foreign Minister Jose Miguel Insulza has been mentioned as a possible compromise candidate to head the World Trade Organization (WTO) by the influential British publication The Economist. Neither of the two individuals originally vying for the position, former New Zealand Prime Minister Mike Moore and Thailand's Vice Minister Supachai Panitchpakdi, have generated a consensus, thus opening the door to an alternative compromise candidate. The Economist said Insulza, a member of the Socialist Party (PS), might satisfy leaders in developed European and North American countries who are looking for a progressive yet seasoned leader, while also generating support by WTO third world members who are insisting that their next leader come from a "developing" country. Were Insulza named to the position, it could prove a feather in the cap of center-left Concertacion alliance nominee Ricardo Lagos, the odds-on bet to become Chile's next president. Lagos would then count on the support of Chilean PS members in leadership positions in two important world organizations: Insulza at the WTO and Juan Somavia, named last year as head of the United Nations International Labor Organization. It might also be a comfortable out for Insulza, who as the point man in the Chilean government's strained defense of Gen. Augusto Pinochet (defending the concept of national sovereignty and not the person of Pinochet) has come under stiff criticism from parts of the PS leadership. -- JOKE TURNS SOUR AS CLOWNS HIJACK BUS. Seven people were robbed at gunpoint on a Santiago bus Thursday by two thieves disguised as clowns, in what was described as further evidence of soaring numbers of armed robberies in the capital and justification for rising citizen concerns over public safety. Passengers said the two clowns boarded the bus, asking the driver permission to put on a show. Salespeople and entertainers are common on Santiago buses. But the passengers became alarmed when, after telling several jokes, one of the clowns said "as you all know, there are good clowns and bad clowns. We're the bad type, so hurry up and start handing over your money." One of the clowns then proceeded to collect money while the other blocked the doorway, holding a revolver. After the clowns had made their getaway, the seven female passengers berated the driver and another man on the bus for doing nothing to help them, and even accused the former of being in cahoots with the assailants. No one reported the incident to police, and one of the passengers later said, "these criminals know the drivers and most of the passengers who travel frequently, so how can we report the crime without fear of reprisals?" A recent survey by the Citizen Peace organization revealed high levels of public concern over safety issues in Santiago. -- ANTONIO BANDERAS TO PLAY VICTOR JARA. Spanish actor and Hollywood golden boy Antonio Banderas looks set to play the part of Chilean singer-songwriter Victor Jara in a movie to be directed by English rose Emma Thompson on the Chilean folk singer's life and subsequent death at the hands of the Chilean military in the wake of the 1973 military coup. Victor Jara's widow, Joan Jara, said she received a letter from Banderas expressing his admiration for her husband and saying the Chilean became a symbol of hope for him during the Franco dictatorship in Spain. Emma Thompson has reportedly finished the script after delays due to her pregnancy, and the film looks set to be filmed in Chile, although a date has not yet been set. The movie is based on the book "Victor Jara, A Song Cut Short," by Joan Jara. The book will be officially released in Chile for the first time June 16, after being banned by authorities during the regime of military leader Augusto Pinochet. Victor Jara was arrested by Army officials immediately after the 1973 military coup, and was taken to the National Stadium, where he was tortured and executed along with other political prisoners. * HEADLINE: SANTIAGO WATER COMPANY SOLD AT RECORD PRICE Rate Hikes and Water Rationing Predicted KEYWORDS: ECONOMY; INTERNATIONAL SOURCE: EL MERCURIO SOURCE: LA TERCERA TEXT: In by far the largest privatization deal in Chilean history, a Spanish-French consortium owned in part by Spanish holding company Endesa Espana won the bidding Friday for 42 percent of Santiago metropolitan region water and sewer company Emos for US$964 million. The price offered by Aguas Metropolitana was more than double the government's bottom line price of US$420 million. The second largest bid was by the British-Portuguese-Spanish consortium Andes Sur Limitado. The sale took place despite recent strenuous objections by all the parties in the ruling Concertacion coalition as well as Emos workers. One of their main objections was that they didn't think Emos would get a good price given the current recession. But Finance Minister Eduardo Aninat hailed the sale, saying, "the high price Emos brought reveals the confidence foreign investors have in the Chilean economy." And he further noted "a certain discrepancy between the perspective sown by a few businessmen (in Chile) and the general expectations held by foreign businesses regarding potential in our country." The winning consortium is owned by Aguas Barcelonas (Agbar) and Suez Lyonnaise de Eaux. Agbar Latin American Director Alfredo Noma said his company would operate the franchise. The company has been in Chile for six years, operating on the south central coast and controlling the southern Region X water and sewer service, Aguas Decima. Suez is the largest water systems company in the world, and it runs the greater Buenos Aires water wervice. Aguas Metropolitana will have the right to appoint four of the seven members of the Emos board of directors. Suez Lyonnaise de Eaux indirectly controls 47.6 percent of Agbar, and Endesa Espana, also owner of top Chilean electricity- sector holding company Enersis and Chile's largest energy generating firm Endesa Chile, holds 11.7 percent of Agbar. Government Secretary General Jorge Arrate addressed the issue of further foreign control of Chile's economy on Friday: "The nationality of the bidders doesn't influence our decision, but rather the economic strength and the efficiency with which they can carry out the work they have promised." However, Chamber of Deputies Finance Commission President Pablo Lorenzini said he would request revisions in the water utility law to avoid the situation of overlapping ownership and service cuts that the privatized electricity industry now finds itself in. And fellow Christian Democrat Dep. Luis Pareto strongly criticized his party for abandoning the principles of Christian humanism. He said he didn't think a privatized Emos would provide the service, especially to poor people, that it has previously, and that he expected to see water rationing as well as rate hikes in coming months. Emos President Sergio Saavedra concurred with the possibility of rate hikes, saying potable water rates would probably go up 8 to 12 percent next year. The Emos privatization is expected to take until late September. Some 10 percent of Emos stock will be available to private stock market investors for 90 days, and Emos workers will have a year to purchase another 10 percent of the shares. Corfo, the current state owner of Emos, will keep 38 percent. Emos has 1.13 million potable water clients. Saavedra said the company's investment needs for the next three years would be met by the sale. The government will invest some US$420 million of its return from the deal back into Emos, and total investment in Emos is expected to total US$1.8 billion. Among the top investment priorities is a water treatment plant in southern Santiago. Emos is the second and largest Chilean water company to be sold by the government, and the last public service sector to be privatized. Three other regional water companies are scheduled to be sold this year. * HEADLINE: MINING NEWS ROUND UP KEYWORDS: MINING SOURCE: EL MERCURIO SOURCE: EL DIARIO TEXT: Today's mining news, as it appears in the national media: -- AUDIT MADE OF CODELCO DEALINGS WITH BRAZIL FIRM. The Chilean Copper Commission (Cochilco) is auditing the state- owned copper giant Codelco in response to allegations that the company blundered in its handling of a construction contract with an international consortium led by Brazilian contracting firm Andrade and Gutierrez, government spokesperson Susana Mena confirmed to The Santiago Times. Right opposition legislators last week charged that Codelco may be forced to pay compensation of US$35 million to the consortium, which announced in March that it would not be able to complete construction of a hydroelectric generator to supply the El Teniente mine's electricity needs. The legislators said the payment is required by a clause in the contract, apparently inserted by Codelco, stipulating that the state- owned company would pay compensation in the case that the project was not completed. The clause was termed as "strange" by the legislators. Mena told The Santiago Times the auditing was requested by Congress and the Mining Ministry. Codelco officials last week dismissed the charges, saying that the questioned clause merely provides for a negotiated purchase of the parts of the project that have been completed. Codelco said the amount given for any possible purchase will be determined by company experts. -- CODELCO PLANS FOR ENERGY CRISIS. Mining Minister Sergio Jimenez says state-owned copper giant Codelco is being affected when programmed electricity cuts take place in the country's Central Interconnected System (SIC) power grid. Between 20 to 80 percent of the activity at copper mining centers such as El Teniente and Andina has to halt during a power outage, and some delicate processes cannot be interrupted. Hence Codelco is readying plans to start the bidding process to build a hydroelectric power plant on the Cachapoal River in central Region VI. Jimenez said the facility will have a generation capacity of 400 megawatts, which will meet the needs of El Teniente plus allow electricity sales to the SIC. * HEADLINE: BUSINESS BRIEFS KEYWORDS: ECONOMY; INTERNATIONAL; NAFTA SOURCE: EL MERCURIO SOURCE: EL DIARIO TEXT: Today's top business stories: -- US FIRM TAKES OVER ELECTRICITY DISTRIBUTOR EMEL. U.S. energy company PP&L (Pennsylvania Power & Light) Resources has reached agreement to purchase an additional 29 percent of Empresas Emel, Chile's third largest electricity distributor. It now controls 38 percent of Emel. PP&L Global is purchasing most of the stock, worth some US$100 million, from its affiliate, holding company Las Espigas, currently Emel's majority stockholder. "We're very pleased with this purchase augmenting our investment in Chile," PP&L Global President Paul Champagne said, "in what is the most stable and fastest growing Latin American economy." Emel also distributes electricity in Bolivia and El Salvador. -- ECONOMISTS PREDICT ONE PERCENT GROWTH THIS YEAR. Leading economists say Chile's rate of economic growth will probably fall to 0.9 percent this month, compared to 1.8 percent in March, according to a monthly survey of economists carried out by the Chilean newspaper El Mercurio. The group also agreed that interest rates will continue to fall, and that the unemployment rate will rise to at least 8.7 percent. It was 8.2 percent in March. Finally, they estimated that inflation would hold steady at around 4 percent but that the value of the peso would drop to about 511 to the dollar. -- HOTEL OCCUPANCY RATE TUMBLING. With hotel occupancy in Chile falling 20 percent in the first five months of this year compared to the same period in 1998, the two-year drop in hotel occupancy will certainly continue this year, according to the Chilean Hotel Association. General Manager Gustavo Abell said the average rate of occupancy fell to 46 percent in the first five months of this year, compared to 57 percent in the same period of 1998. Last year it was 52 percent overall and in 1997, 55 percent. The average hotel occupancy rate last year in all of Latin America was nearly 63 percent. Abell attributed the sharp drop in Chilean rates both to the recession and to an overabundance of hotel rooms, particularly in the capital, Santiago. The number of hotel rooms in Santiago grew 6.2 percent in 1998 and is expected to expand 22 percent by the end of 2001, to 8,320 rooms. It should be noted, however, that the 1998 rate was artificially high due to two large international events that took place in Santiago, the Summit of American Presidents and the International Air and Space Fair. Abell said downtown areas are particularly affected by the boom in hotel construction in the more upscale eastern part of the city. Only two years ago there was only one hotel in the northeastern Vitacura neighborhood, but now there are five. And he said three-star hotels have suffered from a drop in tourism from neighboring countries due to the recession. * -- BASIC ECONOMIC INDICATORS: Dollar's value: Observed, 498.63; Accord, 487.64; Interbank, 499.70 Today's Unidad de Fomento, UF: $14,883.70 Copper Price: Down 0.07% to US$0.6337 Stock Exchange: IGPA, Up 0.54% to 4,625.82; IPSA, Up 0.74% to 120.61 * ================================================================= NY Transfer News Collective * A Service of Blythe Systems Since 1985 - Information for the Rest of Us 339 Lafayette St., New York, NY 10012 http://www.blythe.org e-mail: nyt@blythe.org ================================================================= pvtsa-06.16.99-03:13:12-21228