Mon, Dec 23, 2013 - Page 15 News List

Minister resigns over Uruguayan plane scandal

UNDUE INFLUENCE?The minister is suspected of using his position to speed up the sale of seven ex-state-owned planes, which still have yet to be paid for

Reuters, MONTEVIDEO

The Uruguayan economy minister resigned on Saturday in the face of allegations he took part in the irregular sale of government airplanes during the closure of the country’s flagship carrier, Uruguayan President Jose Mujica said.

Mujica defended the conduct of Fernando Lorenzo, his minister since March 2010, as local television broadcast images of the economist entering a courthouse on Saturday morning.

“He has been a brilliant minister,” Mujica told reporters. “We have no doubt about his ethical integrity.”

Lorenzo was widely respected by investors, but faced growing criticism after the government sold seven airplanes that once belonged to Pluna, the airline the state took over and shuttered in the wake of its bankruptcy last year.

Pluna was previously 75 percent controlled by the Leadgate financial group, with the government owning the rest.

The state has yet to receive anything in payment for the planes — bought in October last year by businessman Hernan Calvo, who used a different name when bidding on them.

Calvo is linked to an influential Argentine businessman who controls several big businesses in Uruguay, including BQB, an airline that once competed with Pluna.

The attorney general’s office suspects Lorenzo of using his position to speed up the US$137 million deal, which his ministry was not charged with overseeing.

Lorenzo has said he did nothing wrong and is appealing the attorney general’s request to move the investigation to trial.

“I am at peace with the decisions I made,” he was quoted by the Web site El Observador as saying after leaving court on Saturday.

Uruguay’s state bank president Fernando Calloia was also summoned to provide statements to investigators on Saturday about a US$13.6 million guarantee the bank made for the purchase of the planes.

Mujica is considering replacing Lorenzo with the current president of Uruguay’s central bank, Mario Bergara, who would in turn be replaced by Jorge Polgar, a former president of the bank Hipotecario, a source in the president’s political party, Broad Front, told reporters.

Uruguayan Interior Minister Eduardo Bonomi will temporarily head the economy ministry until a new minister is sworn in.

Lorenzo’s departure from government will allow him to make statements about the scandal that he might not be able to make as minister, a source with the Broad Front party told reporters.

Mujica vowed to adhere to any judicial rulings.

“We will respect the decisions of the court entirely, as is natural in a law-abiding society,” he said.

A source in the economy ministry said that Mujica did not ask Lorenzo to resign.

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