LETTERS.

Post-Castro Cuba?

IT WAS INTERESTING TO READ INQUIRIES about Puerto Rico, Spain and Portugal from some of your readers. But you have yet to provide any information about the largest island in the Caribbean-Cuba. Communist rule is not going to last much longet President Fidel Castro is in his 70's and there is no successor to take his place. The Cuban people are anxious for a change to capitalism, and will welcome Cubans from Florida with open arms and parades. How about preparing for the transition by publishing information that will be useful to your non-U.S. citizen investors?

John D.Stoller

Encino, California, USA

Tell Full Story of Telmex

EARNINGS ARE NOT THE ONLY REASON WHY Telefonos de Mexico is "enjoying deregulation:' as your "Top 100" survey pointed out (July 1999). Despite a telecom law based on sound competitive principles, Mexicos regulatory system has favored Telmex. As a recent OECD [Organization for Economic Co-Operation and Development] report pointed out, it allows this former monopoly to set predatory prices in the competitive long-distance market, and to compensate by hiking prices for local service, where it retains dominance. It allows funds collected for the public purpose of building new lines to accumulate as general revenues for Telmex, without accountability. It sets network access charges without reference to actual costs and it functions without transparency. The Mexican consumer loses out. AMEDEC, a Mexican consumer group, notes that contrary to world trends, local service rates have increased eightfold since Telmex was privatized. Mexican officials say their first goal was "not to destroy value" in Telmex by throwing a newly privatized company into an overly competitive environment. That goal has been met-to a fault. It now falls to the new chief regulator, Jorge Nicolin, to put consumer interests first.

Philip Peters

Vice President

Lexington Institute

Arlington, Virginia, USA

Contraband Zone

IN YOUR RECENT ISSUE (JULY 1999), I HAD a chance to read Claire Poole's story about the Free Zone in Colon, Panama It worries me that your correspondent does not understand that this free zone represents a grave threat to other countries in the region. As far as my country, Colombia, is concerned, about 70% of all contraband and laundered money-from narco-traffickers-goes through this free zone. Did you know, for example, that exports to Colombia from Colon are worth an estimated $1.7 billion, yet Colombia only collects about $200 million in legitimate revenue. The rest is contraband and laundered money The worst part of all this is that the government of Panama turns a blind eye and does nothing to combat the problem. Your magazine would be far better served by doing more thorough investigations instead of promoting a zone that is the source of such alleged criminal activity.

Juan Diaz

Bogota, Colombia