Santiago Times for May 17, 1999 Via NY Transfer News Collective * All the News that Doesn't Fit Santiago Times May 17, 1999 * HEADLINE: PINOCHET DOCUMENTS QUESTIONED BY COURT Judge Finds That Special Diplomatic Status Was Unjustified KEYWORDS: INTERNATIONAL; JUSTICE; POLITICS SOURCE: LA TERCERA SOURCE: EL MERCURIO TEXT: A judge in the Second Santiago Criminal Court found that former military leader Augusto Pinochet used "ideologically falsified" documentation to travel to London last September, upholding claims that the special diplomatic status awarded him was unjustified. The ruling was the result of a lawsuit filed October 20, four days after Pinochet's London arrest, by lawyer Julia Urquieta on behalf of various human rights organizations. The lawsuit was directed against those responsible for issuing the document accrediting Pinochet with the status of special ambassador and plenipotentiary on a special mission for the Chilean government. According to Judge Carlos Escobar, the delay in the ruling on the lawsuit was due to the difficulty in singling out the specific officials responsible for issuing the document and assurances from the Foreign Office that Pinochet was engaged in a duly authorized special mission. Escobar, however, found that lifetime Sen. Pinochet was not engaged in any such special mission and thus the documentation, although officially approved, was effectively false because the reasons for its issue did not correspond to the truth. Much of Pinochet's legal defense and the national sovereignty position staked out by Chile's government rests on the premise that the former military junta leader was engaged on a duly authorized special diplomatic mission. During his visit to London, Pinochet was to visit several military hardware firms. At the time of his arrest, however, he was recovering from back surgery in an exclusive London health clinic. Urquieta said "the document's contents did not correspond to the facts, because there was no special mission." She added "when a false passport is issued, the international standing of Chile is compromised." Urquieta also noted that the official approval for the passport was not issued by the appropriate government office until October 14, two days before Pinochet's arrest. "That made us think the authorization had been rushed through because they knew about the impending arrest," she said. Interviewed live on National Television's Channel 7 last night, Foreign Minister Jose Miguel Insulza denied that any wrongdoing had occurred. "You can question my judgment (for issuing the special diplomatic status), but there was no falsehood committed," Insulza said, adding that it was completely within executive branch's prerogative to award special diplomatic status for government officials traveling abroad. Pinochet's personal lawyer, Hernan Errazuriz, said Judge Escobar's ruling was "inconsequential, because it questions the existence of a diplomatic mission authorized by the Foreign Office." He added the judge was merely attempting to weaken the concept of diplomatic immunity that the government and Pinochet's personal defense lawyers have upheld before the British High Court and Law Lords. "As former Army Commander-in-Chief, ex Head of State and currently a senator, Pinochet has every right to a diplomatic passport," said Errazuriz. Christian Democratic Party presidential candidate Sen. Andres Zaldivar also dismissed the court's finding as inconsequential, but center-left presidential contender Ricardo Lagos said Foreign Minister Insulza owed the country a full explanation of the situation. Pinochet was arrested October 16 in London stemming from Spanish investigations into human rights abuses committed during his 1973-1990 regime. British Home Secretary Jack Straw gave the green light to extradition proceedings April 15, a ruling which Pinochet's defense lawyers challenged May 6 in Britain's High Court. * HEADLINE: CURRENT EVENTS BRIEFS KEYWORDS: POLITICS; ECONOMY; INTERNATIONAL; ENVIRONMENT SOURCE: EL MERCURIO SOURCE: LA TERCERA TEXT: Today's other headline stories in brief: -- SPECIAL PINOCHET MASS LED BY FATHER HASBUN. Chile's top military officials attended a special liturgical ceremony Sunday led by Catholic priest Father Raul Hasbun on behalf of former military junta leader and senator for life Augusto Pinochet. The event was organized by the Augusto Pinochet Foundation and held in the Army's Military School. Hasbun, a conservative church commentator on Catholic TV Channel 13 for the past 20 years, led the assembly in calling for "the reestablishment of the reign of law so that we can be allowed to live in peace. And so that justice may be done for a man who has given his whole life to his family and to his country." Hasbun urged military leaders not to give up hope for Pinochet's prompt return to Chile. "Do not lose your way. Do not let my voice be silenced. Know that not anyone, nor time, nor forgetfulness, nor indifference, or the prolonged, indefinite exasperation of ambiguous situations... will separate me from you," said Hasbun. Top military brass from the Army, the Navy, the Air Force and the Carabineros police attended the ceremony in full military dress, while lower ranked military officials attended dressed in civilian attire. In related news, the Army this weekend informed the Defense Minister that it is not satisfied that the government's proposal to seek international arbitration in the Pinochet case shows sufficient commitment to seeking the return to Chile of the former military junta leader. Pinochet is currently under house arrest in London, facing extradition to Spain for human rights abuses committed during his 1973-1990 regime. "This whole (Pinochet) thing is now purely political," retired Gen. Rafael Villrroel said after the Sunday mass. "President Eduardo Frei should speak directly to Mr. Straw, to Mr. Blair and Mr. Aznar. It is that simple. This talk of arbitration and all the rest will take years to resolve. Frei cannot step down from the presidency with Pinochet still in jail." -- STUDENTS STAY UNIFIED IN PROTESTS. After a meeting with representatives from over 27 Chilean student federations Sunday, the Chilean Students Confederation (Confech) agreed to continue protests aimed at demanding more government funding for state-owned university grants. Confech called for a nationwide student protest next Wednesday. The protests, which have been going on for over a month, appeared to be in danger of fragmenting Saturday, when student demonstrators in the southern city of Chillan attempted to "politicize" the movement, according to sources. But student leader Flavio Candia said the students decided to reaffirm their unity with Confech "because it's the most sensible course of action; the central issue is the demand for more funding and we cannot allow fragmentation at this stage." Authorities have accused Communist Party (PC) activists of infiltrating student movements in order to encourage civil unrest and thereby create an atmosphere of political instability in order to engender the conditions for a national strike. PC presidential candidate Gladys Marin said the government was trying to lay the blame for its own failings on others. PC officials said "this is a real conflict; the PC didn't invent it, but we can offer solutions." They added the government was trying to play down the real conflict, which is the matter of serious failings in the university system. Authorities' concerns were raised by a document distributed to students by the PC urging them to generate a political atmosphere which would allow the national strike called for by the Central Workers Union to go ahead in August. The document calls on students affiliated to the Young Communists organization to take control of the protests, saying "now is the moment to politicize the student struggle." Student leader Ivan Mlynarz, however, said the majority of student federations were led by representatives affiliated to the governing Concertacion political alliance and thus accusations of political radicalization were unfounded. -- PDC MOVE TO THE RIGHT COULD BRING PARTY SHAKEUP. Santiago Mayor Jaime Ravinet, a member of the Christian Democratic Party (PDC) and the titular head of PDC candidate Andres Zaldivar's presidential campaign, created a stir this weekend by publicly criticizing top Zaldivar campaign operatives Rafael Moreno and Patricio Rojas for their efforts to seek out primary vote support from the political right. Ravinet said the primary campaign should be designed "to give the Concertacion greater strength, not to tear it apart" and that declarations by Moreno and Rojas soliciting the support of right voters "create confusion and divisions within the PDC" and "are a tactical error that could cost us with the voters." Ravinet denied reports, however, that he was stepping down as Zaldivar's campaign figurehead as a result of the controversy. Analysts commenting in several different national papers say the turn to the right taken by the Zaldivar campaign managers is not shared by the majority of PDC activists. The PDC elects new national leadership immediately after the May 30 primary. If Zaldivar does not win the nomination, analysts predict that new leadership will be elected and "hard right" PDC activists like Moreno, Rojas and candidate Zaldivar's younger brother Adolfo Zaldivar will be removed from positions of influence in the party. Should center-left candidate Ricardo Lagos win the primary election, as polls currently suggest, a change in PDC leadership immediately after the primary vote could go a long way in restoring unity within the governing Concertacion political alliance, which includes the PDC, the Socialist Party, the Party for Democracy and Radical Social Democratic Party. -- CONGRESS RATIFIES EQUAL RIGHTS FOR WOMEN. Constitutional reform establishing equal rights for men and women and putting an end to any kind of sex-based discrimination was ratified by a vote of 118-3, with three abstentions, in a joint session of Congress Saturday. Specifically, the reform replaces the word "men" in Chile's constitution with the word "person," so that the first section of the first article of the constitution now reads: "All persons are born free and are equal in their dignity and their rights." Article 19 of the constitution also was changed and now reads: "Men and women are equal under the law." The three right senators opposing the first change said it could open the door to legalized abortion in Chile because it establishes that a person's rights adhere upon birth, rather than upon conception. Amendment supporters discounted these claims, however, calling them exaggerated. With the constitutional reform now approved, the Dominican Republic is the only remaining Latin American nation without constitutional safeguards protecting the equality of the sexes under law. -- ENVIRONMENTAL ALERT EXPECTED TO FILL HOSPITALS. An environmental pre-emergency was declared Sunday in Santiago for the fourth time this year, leading health officials to predict a sharp increase in bronchial-pneumonia problems for the city's young children. "Whenever there is an environmental emergency alert, we can always expect a huge influx of young patients two or three days later," said Dr. Rocio Garcia, who works at the Calvo Mackenna Hospital. "There will be at least 450 kids here within the next few days with respiratory problems." "We haven't had to hospitalize any children yet, but that will come this next month as climatic conditions get worse," said Dr. Maximo Caballero, a surgeon at the Emergency Unit of the Exequiel Gonzalez Cortes Hospital. Prompting Sunday's environmental alert was a particulate count of 331, considered to be a "critical" level by authorities, at the Pudahuel pollution monitoring station. The monitor in central Santiago street El Bosque registered a particulate count of 218, or "bad." Contamination indexes from monitors in higher income neighborhoods of Vitacura and east Santiago, however, registered atmospheric conditions as "good." These more affluent neighborhoods are closer to the Andes mountains and have a somewhat higher altitude than most other Santiago communities, perhaps accounting for the lower pollution levels. Contamination figures declined enough late Sunday to permit authorities to rescind the alert for Monday. -- STRIKE PROPOSED AS STEVEDORES SEEK UNIFIED FRONT. More than 150 port union leaders meeting this weekend in Valparaiso to study the creation of a new umbrella union to unite port workers from all over the country agreed to strike May 21 unless government officials respond to their demands. The May 21 strike will coincide with Chile's annual celebration in Valparaiso of its naval heroes. Valparaiso port union leader Walter Astorga said port workers are seeking job security guarantees and special job separation benefits based on seniority to counter the threat of job losses that will most likely occur once the government goes forward with its plan to privatize, in whole or in part, Chile's ten state-owned ports. "A single union will help in negotiations, in the creation of special laws favoring our interests and in recuperating all the ground that has been lost these past 20 years," Astorga said. Astorga led portworkers at Valparaiso, the nation's largest port, in three short-lived strikes in March to draw attention to their demands, but the effectiveness of the strikes was undercut by workers at the Coquimbo and Lirquen ports, who refused to participate in the strike activity. Chilean fresh fruit exporters, who faced substantial multi- million dollar losses because of the Valparaiso strikes, shipped their fruit through Coquimbo and Lirquen instead. Representatives from unions at Coquimbo and Lirquen failed to show at this weekend's meeting, making it less likely that a successful national port workers union will be formed. The unionists Sunday also rejected claims by government officials that portworker unrest was being engineered by the Communist Party for political purposes. Union leader Jaime Munoz said that most portworkers were not identified with any political party and that their strikes had received support from Christian Democratic Party leader and city councilman Eugenio Trincado, a former port director. * HEADLINE: BUSINESS BRIEFS KEYWORDS: ECONOMY; INTERNATIONAL; NAFTA SOURCE: EL MERCURIO SOURCE: EL DIARIO TEXT: Today's top business stories: -- LUKSIC BANCO SANTIAGO BUY FAILS. The Luksic group's hopes of buying back a large minority share of Banco Santiago were dashed Sunday after the Chilean Central Bank declined to offer its 35.4 percent share of Chile's largest bank and Bankers Trust closed the process. Two weeks ago Luksic holding company Quinenco offered 19 cents a share for 45 percent of Banco Santiago, worth some US$900 million, conditioned on the Central Bank shares. Twice in the last two weeks Central Bank President Carlos Massad had disclaimed interest in selling its shares of Banco Santiago, but speculation about the offer persisted due to the intense interest Quinenco had in recovering control of Banco Santiago. At the end of April it was forced to sell most of its share of the bank to Banco Santander Central Hispano (BSCH) as part of a deal the two companies reached in January to end their affiliation. Sources said the Central Bank didn't consider Quinenco's price of 19 cents adequate, nor did it think its 35.4 percent share of Banco Santiago would guarantee Quinenco's takeover of the bank. Monday the Quinenco board will decide whether or not to buy the other stocks involved in the takeover deal. On May 5 it allied with Hong Kong and Shanghai Banking Corporation, 7 percent owner of Banco Santiago, and said it hoped to enlist some of the smaller shareholders who together own 10 percent. Quinenco owns 11 percent of the bank. -- YRARRAZAVAL IS SURPRISE NEW ENDESA PRESIDENT. Chilean Stock Market head Pablo Yrarrazaval is the new president of electricity generating company Endesa Chile. Holding company Enersis, which just took control of 60 percent of Endesa Chile in the name of its owner, Endesa Espana (EE), on Friday appointed six new directors for the company. The other three directors will be pension fund administrator (AFP) representatives until the probable departure of one in favor of a Luksic group representative. On June 24 stockholders will be asked to attend a special meeting to approve the given new Enersis-selected directors. In addition to Yrarrazaval, they are Spaniards Hector Lopez (who will serve as vice president), Alberto Lopez, Jesus Burillo, Jose Maria Hidalgo and Andres Regue. Luksic representative Rodrigo Manubens will await approval by the stockholders before joining the board. Yrarrazaval is one of six founders of Enersis, but he insisted he had maintained his independence during the drawn-out takeover of Endesa Chile. One of the conditions set by the Chilean Anti-monopoly resolution commission in approving the takeover was a remake of the Endesa Chile board with directors independent of Enersis. "As president of the Stock Exchange I have advocated open investment," Yrarrazaval said. "I have defended a company that I think is very respectable the same way I'd defend any company. Moreover, I have been a longtime promoter of Santiago as a regional financial center, and I'm pleased to see several large companies entering our market." Those in favor of Yrarrazaval's appointment said all the stock market's directors are members of other boards. -- NORTHERN GAS PIPELINE TWO THIRDS COMPLETE. Construction of natural gas pipelines to fuel electricity generation for Chile's Norte Grande Interconnected System (SING) power grid is proceeding on schedule, authorities said late last week. The Nor Andino line that will carry gas from the Salta Province in Argentina to Chile's northern Region II is 68 percent complete and should be on line in October, general manager Oscar Moscoso said. The line will deliver gas to electricity producers Electroandina, controlled by Belgian company Tractabel, and Edelnor, owned by US firm Southern Electric. US$320 million of an anticipated US$400 million investment has already been spent. Nor Andino will function parallel to the Gas Atacama pipeline under construction by CMS Energy and Endesa Chile, owners of northern energy producer Nopel. While negotiations to combine the two projects failed, the companies building the two pipelines may be able to establish mutually beneficial commercial accords to secure their supplies. -- MATCH COMPANY STYMIED BY MEXICO. Although it has operated in Mexico since 1993, La Compania Chilena de Fosforos (Chilean Match Company) said it had to halt unloading and shipping of its products there recently due to a new Mexican government requirement mandating national distribution of their products in specially owned trucks. The Chilean firm says the new requirement is the latest in a series of obstacles authorities have established to its operations there, and it has now appealed for help from Chilean commercial organizations. Fosforos said since 1993 it has been required to obtain revenue authorization signed by the Mexican president, Defense Department approval, establish its own warehousing and transportation systems and even get quality approval from the one Mexican match producer. Its average annual sales in Mexico total some US$18 million. -- PORT PRIVATIZATION PROCESS CONTINUES. By this Thursday naval bases at Chile's three principal ports, in Valparaiso, San Antonio and San Vicente, should be sold to private companies, and investors will have until July 29 to present offers to manage the docks at the three ports. The bid specifications should be available by early June. Contracts are scheduled to be awarded on August 27, and at each port one company will be given a monopoly. Valparaiso's main terminal is the largest dock area to be offered in this round. Docks in Arica and Iquique will be sold later. -- ELECTRICITY AUTONOMY ADVANCES. Electric power generating companies who are members of the Central Interconnected System (SIC) power grid are scrambling to give the CDEC, the body that overseas the Chilean electric system, autonomy to operate the SIC's power dispatch system. Power generation companies were recently fined by the Electricity and Fuel Superintendency because the CDEC was supposed to be functioning as an autonomous enterprise by last January. The SIC companies said the CDEC should be in operation later this month or next. The CDEC will operate using equipment loaned by the electricity companies until the completion of a bidding process to acquire its own equipment. SIC companies Thursday named Carlos Mackenna CDEC operations and tolls director, who will be in charge of technical and economic decisions. -- INTERNET PROVIDERS CRITICIZE TARIFF STRUCTURE. Chile's Internet access providers (ISPs) met Tuesday with officials from the Chilean telecommunications giant Compania de Telecomunicaciones de Chile (CTC) and expressed doubts about the local phone system's proposed new tariff structure. Currently, most Internet customers pay a fixed rate to the providers and a variable rate to CTC, based on usage. The new tariff system would make several new alternatives available to the providers - to connect their customers to CTC's net and pay for the local call, or become carriers by delivering their service through the long distance net and collecting payment directly from the customers. However, the ISP representatives said they wouldn't be able to become carriers because they're not in a position to provide all the services necessary. "The tariff structure could create great distortions between providers," Interaccess General Manager Rodrigo Vallarino said. CTC sources agreed that the new system could harm small providers and reduce competition in the long-distance market, where consolidated long-distance carriers will be the strongest. Transport and Communications Ministry Undersecretary Juanita Gana said the new tariff system offers more alternatives to Internet providers, and the final price for the customer will be halved. She noted, however, that Internet access providers will have to make significant investments to assure their presence in the market. -- ZARA UPS CLOTHING COMPETITION. A larger than expected initial influx of customers to the new Zara women's fashion store is provoking jitters among competitors. The well-known Spanish chain opened its first Chilean store in the Parque Arauco mall two weeks ago. Although sources said competitors were already examining Zara's marketing techniques, Almacenes Paris administration and finance manager Gonzalo Salinas said his more diverse company wasn't particularly affected by Zara. Almacenes Paris earns almost a third of its annual US$50 million in sales from women's clothing. Sources at another competing department store Falabella admitted they were worried about the new competitor, but said Zara would probably hurt undercapitalized local stores more. Zara General Manager for Chile and Argentina Jorge Ruiz said his company's arrival in Chile would stimulate sales in the entire sector, adding, "the competition will respond quickly, improving pricing and marketing. Everyone will innovate." * -- BASIC ECONOMIC INDICATORS: Dollar's value: Observed, 486.18; Accord, 485.33 Interbank, 484.50 Today's Unidad de Fomento, UF: $14,837.21 Copper Price: Down 0.90% to US$0.6958 Stock Exchange: IGPA, Down 0.59% to 4,718.03, IPSA, Down 2.22% to 122.73 * ================================================================= 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-05.19.99-02:56:36-17228