Tuesday, October 7, 2008


Energy minister quits over scandal

LIMA | Peru‘s mines and energy minister, Juan Valdivia, said Monday he has resigned over a scandal that involved steering oil concessions to favored bidders.

The departure of Mr. Valdivia, who has worked to lure billions in foreign investment to the country’s vast mining sector and growing petroleum industry, comes as two other high-ranking energy officials were forced out.

“Yes, the president has accepted my resignation,” Mr. Valdivia told Reuters news agency.

Alberto Quimper, a board member of the state energy agency Perupetro, which organizes auctions of exploration lots, and Cesar Gutierrez, president of state oil and gas company Petroperu, were both fired, the country’s official gazette said.

The scandal was exposed late on Sunday when an audiotape surfaced on an investigative TV news show that included a conversation between Mr. Quimper and Romulo Leon, a prominent member of President Alan Garcia’s APRA party, in which they apparently agreed to favor Discover Petroleum of Norway in a round of energy auctions.

The small Norwegian company, which partnered with Petroperu, was later awarded five blocs after the audio recording was made in February.

Peru’s justice ministry said it would investigate the banking records of the Peruvian executives, and suspend the contracts awarded to Discover.


PRI rebounds in local election

ACAPULCO | The party that governed Mexico for 71 consecutive years has rebounded in local elections, returns showed on Monday, and a poll had it jumping into the lead for next year’s national congressional vote.

Nearly complete results from the southern state of Guerrero showed the Institutional Revolutionary Party (PRI) recapturing mayorships in the major tourist centers of Acapulco and Zihuatanejo while holding onto the state capital, Chilpancingo.

The PRI appears to have benefited from splits in the leftist opposition and by the government’s struggle with drug violence and a slowing economy.

The PRI has struggled since losing its seven-decade grip on Mexico’s presidency in 2000. It finished third in the 2006 presidential and congressional races. But a poll published Monday by El Universal newspaper showed a clear PRI lead for the 2009 congressional elections.


Lula’s party falls short in races

BRASILIA | Brazil’s ruling Workers’ Party increased the number of municipalities it governs in Sunday’s mayoral elections, but it gained less than expected from President Luiz Inacio Lula da Silva’s enormous popularity.

The election result, which could still change in 29 cities with a runoff election on Oct. 26, did not give Mr. Lula da Silva’s Workers’ Party, or PT, the boost it had hoped for to increase its chances at electing a successor to him in 2010.

The PT won 547 mayors’ races Sunday, an increase of 148 over the first round in the last local election in 2004.

But the PT still only placed fourth, lagging behind the centrist PMDB party with 1,200 municipalities, the center-left PSDB with 784 and the Progressive Party with 548.

In Sao Paulo, the largest city and a barometer for national politics, the PT’s Marta Suplicy placed second after the incumbent mayor, Gilberto Kassab of the conservative DEM party.


Bureaucrats told to trim high living

CARACAS | Bureaucrats in oil-rich Venezuela can look forward to fewer expensive SUVs, top-of-the-line mobile phones and whiskey-fueled parties next year.

Finance Minister Ali Rodriguez said Sunday that Venezuela’s 2009 budget “will have significant restrictions” compared with this year’s $63.9 billion plan as President Hugo Chavez’s government keeps a close watch on slumping international oil prices.

“Flamboyant spending is common within Venezuela’s bureaucracy-bloated administration and whiskey usually flows freely when state-run institutions throw extravagant parties in December.

Mr. Chavez last year criticized political allies who purchase Hummers, saying true socialists must do without such luxuries. He hinted last month at spending cuts, saying that “zero waste” should be a mantra for government agencies.

From wire dispatches and staff reports

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