Brazilian Finance Minister

Denies Role in Scandal

BRASILIA -- Brazilian Finance Minister Antonio Palocci said Sunday that he would remain in his post, denying any link to a widening government bribery scandal and saying that Brazil's economy could withstand the political turmoil.

President Luiz Inacio Lula da Silva does not want him to resign, Palocci said during a nationally televised news conference. "I would like to deny with vehemence the accusations. These kinds of accusations require an emphatic denial," Palocci said.

Allegations on Friday that Palocci authorized bribes when he was a mayor for Lula's Workers' Party deepened Brazil's worst political scandal in years. Financial markets sank on worries that the chief architect of the government's investor-friendly policies might lose his job.

The finance minister's decision to call a rare Sunday news conference appeared designed to calm rattled financial markets.

Since the allegations became public in June, a congressional bribes-for-votes and campaign financing scandal has weakened Lula's center-left government. Investors say it would be a catastrophic blow to the government and to financial markets if proof emerged linking Palocci or Lula to the scandal. Palocci has been widely praised by investors for controlling spending and fighting inflation.

AFRICA

* JIJIGA, Ethiopia -- Voting in eastern Ethiopia ended peacefully as elite forces, pro-government militiamen and police patrolled streets to secure the region's delayed elections. Voters in the mostly ethnic Somali region, some armed with assault rifles, gathered at sunrise at polling stations to elect 23 federal lawmakers and 168 regional legislators. Some voters said they hoped the election would help the region escape poverty.

General elections were held in the rest of the country on May 15. But voting in the Somali region was made difficult by heavy rains, poor communications, the region's nomadic lifestyle and the presence of separatist rebels.

THE AMERICAS

* HAVANA -- In a six-hour broadcast from Cuba alongside President Fidel Castro, Venezuelan President Hugo Chavez scoffed at U.S. charges that they were destabilizing troublemakers in Latin America, saying that U.S. government policies -- not his own -- are harming the world.

Chavez used his weekly television and radio show from the western tip of the island to flaunt the close ties between the two leftist leaders who U.S. officials have said are threatening democracy in the region. Castro and Chavez talked mainly about joint social ventures, particularly in the health sector. Cuba has sent one-fifth of its physicians to work in poor communities in Venezuela, in gratitude for massive shipments of Venezuelan oil under preferential terms.

The leaders praised each other throughout the show and took phone calls and messages from supporters in both countries. They also received praise from the audience, which included Castro's cabinet members, former Salvadoran guerrilla leader Shafick Handal and former Nicaraguan president Daniel Ortega.

The visit was Chavez's fourth to Cuba in the last nine months. He arrived Saturday to attend the first graduation of the Latin American School of Medicine, a regional initiative launched in 1998 after two hurricanes devastated Caribbean and Central American nations.

Chavez announced he would create a second such school in Venezuela.

* QUITO, Ecuador -- Leaders of protests that shut down Ecuador's oil industry were freed from jail after agreeing to halt their attacks and negotiate with the government, officials on both sides of the conflict said. The protesters, demanding jobs and infrastructure investment, began blowing up pipelines and vandalizing pumping machinery last Monday.

Output by state oil firm Petroecuador, which suspended exports Thursday, totaled 54,000 barrels per day Sunday, up from 33,167 on Saturday.

* MEXICO CITY -- Riot police fired tear gas and detained 450 people in a clash with demonstrators demanding that authorities drop an investigation of a children's home in the Mexican resort of Cancun, the El Universal newspaper reported. The protesters marched through the city in support of La Casita children's home, which has been accused by state prosecutors of abducting children. Officials at the children's home say the Quintana Roo state government is trying to sully its name after they accused a hotel owner friendly with local politicians of statutory rape.

EUROPE

* PRAGUE -- Former Polish president Wojciech Jaruzelski apologized for ordering Polish troops to take part in the Moscow-led crackdown on the Prague Spring socialist reform movement in 1968. Speaking to Czech state television on the 37th anniversary of the crackdown, Jaruzelski, the Polish defense minister at the time, said the invasion of another Warsaw Pact nation was "very painful for me."

"Today, and naturally much earlier, I realized this decision had been incorrect, wrong, shameful," he said. "As I took part in implementing it, I am now offering my sincere apologies."

-- From News Services

Venezuelan President Hugo Chavez, left, speaks with Cuban President Fidel Castro during a visit to the island. They attended the first graduation of the Latin American School of Medicine, a regional initiative launched in 1998 following two major hurricanes.