Oct. 7 News Brief South America

ASUNCIÓN, Paraguay – Paraguay settles Venezuelan oil debt with state funds: Amid criticism from the opposition that the Paraguayan government had used Treasury bonds to pay off a US$269 million oil debt with Venezuela, CEO Juan González Meyer of the state-run oil company Petropar explained that, in fact, state funds were used instead. "There was a plan to pay with bonds but it wasn't carried out," and, added González Meyer, therefore "it is no longer relevant whether Congress was consulted or not."

[DPA, ABC Color]

BOGOTÁ, Colombia – Uribe insists that relations with neighbors are good: "One thing is our commitment to defeat terrorism, but another thing is our friendship with our brother nations," announced Colombian President Álvaro Uribe, who insisted that his government is doing all it can to fight the FARC, but at the same time it wants to ensure the best possible relationship with its neighbors. The announcement comes at a time when Colombian and Ecuadorian authorities are meeting to restore diplomatic relations that have been severed since March 2008 when Colombia destroyed a guerrilla base camp in Ecuador.

[DPA, El Espectador]

LIMA, Peru – Foreign companies compete for Lima rail contract: Peru's Transport Minister Enrique Cornejo revealed that firms from China, Brazil and Spain will be bidding for a contract to complete an electric rail line project in Lima that has remained unfinished since the late 1980s. Construction began during the first mandate of current Peruvian President Alan García, who is in his second term and is waiting for the Transport minister to conclude the bidding process. According to Cornejo the contract could be awarded before the end of the month.

[La República, EFE]

LA PAZ, Bolivia – Economy shows signals of deflation: Bolivia's National Statistics Institute (INE) reported this quarter that deflation of 0.11 percent was registered between July and September, bringing the total to 0.9 percent so far this year. According to Development Minister Noel Aguirre, the government's annual inflation target, initially eight percent, has already been reduced twice this year; first to 6.6 percent in April, and then down to 3 percent in July.

[El Deber, DPA]

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