SJMercury. Latin America Scrambles on Y2K
Posted at 9:48 a.m. PDT Saturday, April 17, 1999
BY FRANK BAJAK
Associated Press Writer
BOGOTA, Colombia (AP) -- Uncertain their radars' Year 2000
computer problems will be solved, air traffic controllers in this
Andean nation are taking refresher courses in guiding planes the
old-fashioned way -- with radioed position reports and paper
charts.
Federal bookkeepers, meanwhile, may have to switch to paper
ledgers until their computers are fixed.
With a handful of exceptions led by Mexico and Chile, Latin American governments were late in
grasping the severity of the ''millennium bug.'' They now realize they lack the time, money and
programmers to forestall potentially crippling public sector failures when 2000 arrives.
In the United States, where tens of billions of dollars have been spent on ridding computers and
other electronic equipment of the date-sensitive glitch, failures are expected to cause disruptions
akin to a bad snowstorm.
''For us it could be like a volcanic eruption,'' said Hernando Carvalho, a Colombian civil engineer
and lawmaker who began surveying government readiness in December and found it woefully
lacking.
Among Latin politicians, Carvalho is a lonely voice trying to raise consciousness where little exists.
World Bank experts and independent analysts say Latin and Caribbean governments can now do
little more than focus on preventing disasters brought on by the Y2K problem, a legacy of the days
when software writers saved space by expressing years with two digits. That means an unfixed
computer won't be able to tell 2000 from 1900 and might shut down in confusion.
Like most governments in the developing world, they're feverishly working on plans for skirting
unreliable computer systems to ensure the delivery of essential services like water, electricity and
public payrolls.
''Basically everybody's in the same boat. They're only focusing on critical systems and contingency
plans,'' said Rafael Hernandez, an information specialist with the World Bank.
Nearly all Latin governments rely heavily on informatics. And at precisely the moment last year that
they should have been investing heavily in Y2K fixes, the Asian financial crisis hit their economies
hard.
Now there is an almost universal shortness of cash.
Media coverage of the Y2K bug has been scarce in the region, and many presidents, including
Colombia's Andres Pastrana and Argentina's Carlos Menem, haven't even mentioned it publicly.
''I don't want to be an alarmist, but we do want to prepare the people for reasonable precautions.
There could be a run on banks, real bad, and declared bank holidays,'' said Jim Cassell, research
director for the information technology analysts GartnerGroup who has worked extensively in the
region.
Gartner analysts predict half of all Latin American companies and state agencies will see at least
one critical failure -- from power outages to air transport interruptions -- in Argentina, Colombia,
the Dominican Republic, Guatemala, Jamaica, Panama, Puerto Rico and Venezuela. Even worse
off are Costa Rica, Ecuador, El Salvador and Uruguay, they say.
Social unrest and paralyzed commerce are tangible fears.
In this part of the world, ''the public doesn't protest with phone calls and letters -- it riots and
destabilizes the government. There's lots of potential for that,'' said Ian Hugo, deputy director of
Britain's industry-backed Taskforce2000.
Argentina received a $30 million World Bank loan earlier this year to deal with Y2K problems, and
the Inter-American Development Bank expects to open a $2 billion line of credit by May for
confronting the bug.
Yet many of the countries scrambling to draft loan requests still ''haven't identified the trouble areas
(and) don't know how much money they need,'' said Jamie Dos Santos, vice president for Latin
America at Bellcore, a leading international Y2K contractor.
On the whole, Latin American Y2K officials are divulging few details of their countries' progress.
They know international investor confidence is at stake. Brazil, for one, is still trying to meet the
conditions for a $41.5 billion bailout package from the International Monetary Fund.
''Lack of confidence in a country's infrastructure could cause multinational companies to close their
operations,'' a U.S. Senate report warned in early March.
Among nations where officials have been more open is Colombia, where the government's Year
2000 Office, created in September 1997, only just kicked into gear in December.
Managers of the state-run health care system are struggling to determine how to keep Y2K failures
from scrambling the records of its more than 8 million patients. And public hospitals are just
beginning to inventory medical devices for bug-related defects.
Colombian civil aviation officials say their radar systems will fail without repairs worth more than
$11 million, money the federal government says it cannot provide. Without radar, controllers will
rely on voice communications and keep planes spaced more widely apart, delaying flights.
Carvalho said foreign carriers will refuse to fly to Colombia unless the radars and other aviation
systems are fixed by July 1, the cutoff date after which U.S. officials expect to begin releasing
warnings about countries with worrisome Y2K status.
American Airlines, the dominant U.S. carrier in the region, called Carvalho's claim speculative.
''We'll make those decisions when the time comes and obviously safety is our major concern,'' said
Martha Pantin, a spokeswoman for the airline.
In Venezuela, civil unrest could well be on the menu.
''We're going to have a food-supply shortage,'' predicts Alejandro Bermudez, the government's
information systems manager.
He estimates 40 percent of Venezuela's food-processing plants will be paralyzed when unfixed
computer chips in automated factories shut down production lines.
Another anticipated failure: 2,500 elevators in Caracas, the capital, will automatically halt. ''We
know it's going to happen,'' Bermudez insists.
Only about 10 percent of Venezuela's electricity distribution system has so far undergone computer
fixes, and the government says the country desperately needs $1.5 billion for Y2K fixes, adding
that even with that money, repairs will take two to four years.
Multinational corporations and major banks have invested heavily in fixes throughout the region and
all but a few are expected to be ready before the new year. But many are worried about their
suppliers -- and about power generation and water supplies.
Cassell said some companies in Venezuela, Brazil and Argentina are building water reservoirs and
holding tanks with diesel-powered generators to weather any lengthy water outages.
Businesses also are taking precautions in Central America.
Scott Robberson, executive director of the American Chamber of Commerce in Guatemala, is
buying a gas-powered refrigerator and stocking up on extra food, water and propane. He said his
electric company hasn't even started Y2K work, only two of Guatemala's 30 banks are ready, and
few buildings in Guatemala City are fixing elevators and time-sensitive computerized building
security locks that are vulnerable to failure.
Not every Latin government may need to practice triage.
Mexico and Chile actually budgeted explicitly for Y2K last year. And Mexico has stricter reporting
requirements for financial institutions than the United States, said Carlos Guedes of Brazil, deputy
controller and chief information office for the Inter-American Development Bank.
The Brazilian government's Y2K coordinator, Marcos Osorio, said his country's energy and
telecommunications sectors are running behind in repairs. He predicts only ''isolated problems'' but
adds that Brazil's electrical utilities are already ''taxed to the limit'' and highly susceptible to
brownouts.
''Essential government services should be operating well enough not to cause any damage to the
population,'' he said, without offering specifics.
Guedes said, however, that Brazil's chief public data-processing agency, SERPRO, had worked
diligently on Y2K but was still short $35 million to finish fixes. SERPRO handles 60 percent of the
Brazilian government's data processing -- everything from tax collection to national finances to the
federal payroll.
Independent software consultant Carlos Vargas of the Softtek company in Sao Paolo doesn't
doubt that government programmers are hard at work. But he is skeptical of rosy forecasts.
''Nobody knows if the government or companies are being honest,'' he said.
(PROFILE (CO:AMR Corporation; TS:AMR; IG:AIR;) )
Posted at 9:48 a.m. PDT Saturday, April 17, 1999
Year 2000 Efforts by Latin
Govts.
BY THE ASSOCIATED PRESS
Where some Latin American nations stand on Y2K computer bug:
------
BRAZIL:
Latin America's most populous nation, with 166 million people, is
among world's 10 most computerized countries, yet the government
expects to spend just $300 million on Y2K projects, one-third of
that this year.
Marcos Osorio, national Y2K coordinator, says fixes at most federal agencies are well along, with
June 30 deadline for finishing, but pension and health system lagging. Also worrisome are state and
municipal governments, which Osorio says have provided little information on Y2K efforts; they are
responsible for water and natural gas deliveries and citizen registration.
------
CHILE:
Technologically advanced nation of 14 million people where industry and utilities are heavily
privatized. Government has spent $140 million on Y2K fixes, and national Y2K coordinator Aldo
Signorelli says private sector has spent $860 million.
As of the end of January, Signorelli says fixes were 39 percent complete in electrical utilities, 58
percent in telecommunications, 43 percent in natural gas and petroleum.
------
COLOMBIA:
Mired in perhaps worst recession since 1930s, country of 40 million seriously short of funds to
address Y2K bug. Government's Year 2000 council predicts low risk of Y2K-related failures in
financial sector, telecommunications and electricity generation, but sees high risk in public finance,
health services, air and maritime transport.
Council says it lacks adequate information about status of Y2K work on public services in all major
cities. Telecommunications companies have budgeted only half the $400 million they need for fixes,
officials say.
------
COSTA RICA:
Government of this peaceful Central American tourist destination, with 3.5 million people, has spent
more than $40 million on Y2K fixes, national coordinator Esteban Brenes says. Without offering
specifics, he says most government agencies have determined problem areas and begun fixes. But
few have contingency plans for computer failures.
Director of Intel Corp.'s microprocessor plant in San Jose, Danilo Arias, thinks state-owned
electric and phone companies making good progress, but fears Juan Santamaria international
airport behind.
------
PERU:
Financial companies in this country of 24 million people expect to have Y2K projects finished soon,
but government agencies are lagging, with just 16 percent of potential problem areas fixed, says
Felix Murillo, national Y2K coordinator. Only 9 percent of state agencies have contingency plans
for computer failures.
National Statistics Institute, which Murillo heads, has spent $300,000 on Y2K fixes, but has no
figures on total government expenditure.
------
VENEZUELA:
Its oil-based economy suffering from decline in petroleum prices, this country of 23 million expects
serious Y2K-related failures. Government planners have given up on trying to fix many computer
systems and intend to have 15,000 engineers at the ready on Jan. 1, 2000 -- along with National
Guard and army -- to resolve problems as they arise and keep order, says Alejandro Bermudez,
deputy national Y2K coordinator.
Most private companies also way behind schedule, having completed about 10 percent-20 percent
of work on Year 2000 problems, Bermudez says.
(PROFILE (CO:Intel Corp; TS:INTC; IG:SEM;) ) |
