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Last Updated: Saturday, 14 October 2006, 11:47 GMT 12:47 UK
Mill protests shut Uruguay border
Uruguayan workers continue work on the construction of the Finland Botnia pulp mill processing factory
The mill is being built by a Finnish company close to the Uruguay river
Argentinians protesting against the building of a paper mill in neighbouring Uruguay cut road links between the two countries on Friday.

The demonstration was launched after the World Bank indicated it would go ahead with funding for the project.

About 300 people blocked roads leading to a bridge across the Uruguay river in the town of Gualeguaychu, 240km north of Argentina's capital Buenos Aires.

Locals fear the $1.7bn project could cause pollution and harm tourism.

Diplomatic rift

Protests against the plant in the Uruguayan town of Fray Bentos also closed a cross-border bridge upstream near the Argentinian town of Colon.


"No one in Gualeguaychu is going to tolerate that the mills belch out smoke that could hurt our children," protester Daniel Perez told Reuters.

Argentina's objections to the pulp mill have risked a diplomatic rift between the two countries after Buenos Aires took the issue to the International Court of Justice, the Hague tribunal which arbitrates cross-border issues between countries.

The court ruled in July that the project could go ahead, and on Wednesday the World Bank announced that the plant met its environmental standards.

The announcement paves the way for the World Bank's International Finance Corporation to approve $400m of loans for the project, although a final decision on the loans is yet to be made.

Lost trade

EcoMetrix, the Canadian company that conducted the World Bank environmental impact study, wrote that emissions from the mill would be "well below" accepted levels and that local industries were unlikely to face long-term problems.

Environmental protesters gathered outside the presidential offices in Montevideo
The project has aroused strong passions

Argentina's environment secretary Romina Picolotti dismissed the World Bank report this week but also attacked the protesters, saying they could harm the government's attempts to resolve the issue diplomatically.

Uruguay claims an earlier round of demonstrations over the plant had caused the country $200m in lost tourism and trade.

The wave of protests against the project have already caused Ence, the Spanish company that was developing one of two pulp mills for the site, to relocate its project elsewhere in Uruguay.

But the mill being built by Finnish company Botnia is still going ahead.

See the site where the paper mills could be constructed

Court allows Uruguay pulp mills
13 Jul 06 |  Americas
Argentine leader joins mill rally
05 May 06 |  Americas
Bank caution on Uruguay mill cash
12 Apr 06 |  Business
Greenpeace blocks pulp mill boat
03 Mar 06 |  Americas
River row divides former friends
15 Feb 06 |  Americas
Country profile: Argentina
02 Dec 05 |  Country profiles
Country profile: Uruguay
23 Nov 05 |  Country profiles

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