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Security issues overshadow Mercosur talks

Rio Tinto to boost investment in huge Guinea iron-ore mine
Conakry (AFP) Aug 3, 2010 - Anglo-Australian mining giant Rio Tinto announced Tuesday it would invest an additional 170 million US dollars (130 million euros) in the joint development of a huge Guinean iron-ore field with China's Chalco. "This investment of 170 million US dollars, in addition to the 650 million dollars already invested, will be effective immediately" for the extraction of iron-ore from Simandou in south-east Guinea, Rio Tinto said in a statement. This will "allow for the optimisation of the design of the mine, mining infrastructure, the railway and port facilities and additional drilling." Rio Tinto's current plan foresees "the construction of a mine at Simandou with an annual capacity of 95 million tonnes, a dedicated industrial railway of 650 kilometres (403 miles), which includes 21 kilometres of tunnels and crosses Guinea up the coast," the statement added.

"Simandou will be the largest integrated infrastructure and iron ore project developed in Africa to date," Rio Tinto's director of iron-ore extraction Sam Walsh said in the statement. The Anglo-Australian company announced on July 29 it had signed an agreement with Chinese company Chalco to jointly develop the iron-ore mine, with the Chinese company to invest 1.35 billion dollars in the project. Chalco, a listed subsidiary of state-owned Chinalco, will acquire a 44.65 percent interest in the Simandou project in Guinea and Rio will take 50.35 percent. The remaining five percent will be held by the International Finance Corporation, the financing arm of the World Bank. The Guinean government has the option to buy up to 20 percent of the project, where operations are expected to start within five years.
by Staff Writers
San Juan, Argentina (UPI) Aug 3, 2010
Security issues and concerns over a developing military standoff between Colombia and Venezuela dominated talks of the Mercosur customs union, called in San Juan, Argentina, to advance a much-delayed economic and political integration agenda.

Senior delegates said the talks would continue Tuesday to try and reach consensus on key unresolved issues between the two countries.

Mercosur, which looks up to the European Union and aims to create a Latin American state comprised of its member-countries, found itself caught up in a bitter row over Colombia's charges it was under attack from rebels bankrolled or trained by Venezuela.

Venezuela denies the accusation but has displayed its displeasure by cutting off diplomatic relations with Colombia, an act seen by Mercosur strategists as an untimely setback to integration attempts.

At a previous meeting of Colombian and Venezuelan leaders and delegates from neighboring countries, Colombian officials produced what they claimed was photographic evidence of Venezuelan connivance with FARC rebels that are suspected of dealing in drugs to support their campaign against Colombia.

FARC is also suspected of backing organized crime gangs that are at the center of a joint Colombian-U.S. campaign to rid Colombia of its drug overlords and cut off cocaine and heroin supply routes between Central and South America and the United States.

The Colombian anti-narcotics operations have involved U.S. forces and international security industries charged with removing the terrorist threat in the country and its environs, including Venezuela. Caracas denies any links with FARC.

Argentine Minister of Foreign Affairs Hector Timerman announced the Colombian-Venezuelan row would be discussed by the heads of state of Argentina, Brazil, Paraguay, Uruguay, Bolivia, Chile and Venezuela when the talks resume.

Analysts said the key issue before the leaders would be how to persuade Venezuela to review its decision to sever diplomatic relations with Colombia. Mediators have cited the impending government change in Colombia as a window of opportunity for Venezuela to scale down its anti-Colombian rhetoric.

Hard-line President Alvaro Uribe, who was barred constitutionally from seeking a third term, is soon to be succeeded by Juan Manuel Santos, widely seen as a pragmatist who isn't averse to seeking a compromise with Venezuela.

Uribe's sharp exchanges with Venezuelan President Hugo Chavez raised fears the two countries might be on the warpath.

Paraguayan Minister of Foreign Affairs Hector Lacognata, acting as a neutral mediator, encouraged Mercosur to help find a solution for the Venezuela-Colombia confrontation.

"This conflict hurts us but reasserts our conviction that Mercosur can and should make room for dialogue among our nations so that their relations can be restored and back to normal," Lacognata said.

The tension escalated Friday, when Chavez reported on the deployment of troops on the border in the face of "a war threat" from Uribe's government. Uribe ruled out any assault on Venezuela but didn't budge from a position that held Chavez responsible for harboring terrorists on Venezuelan soil.



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