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Published Sunday, October 17, 1999

Third World nations late for an important date

Rajiv Chandrasekaran / Washington Post

ASUNCION, PARAGUAY -- First the computers will crash, bringing down the electrical grid, the water system and the telephone network. Then, nearly 200,000 government workers will discover the state-run bank that prints their paychecks has been crippled by technological glitches. Finally, a day or two later, crowds will riot and loot, forcing the government to declare martial law.

To Walter Schafer Paoli, the Paraguayan government's year 2000 expert, is no science fiction plot. Such bedlam, he says, is quite possible during the first days of January in the poor, landlocked South American country sandwiched between Argentina and Brazil.

His fear stems from a simple fact: The government has been woefully late in tackling the Y2K computer glitch. Most government agencies in Paraguay only recently began the often-protracted chore of fixing their systems.

And to make matters worse, members of a presidential commission set up in the spring to coordinate the repair efforts quit en masse last month, complaining that they were never given offices, a budget or payment for their services.

Paraguay is just one of many developing countries that have been tardy in dealing with the Y2K bug. From sub-Saharan Africa to Central America, Eastern Europe and Southeast Asia, many nations have only just started to vigorously address the issue, raising the possibility of disruptions in basic services.

Although the impact likely will be cushioned by the fact that such nations still have legions of people in rural areas whose lives remain untouched by electronics, failing to squash the bug in time could affect millions of others who live in cities where computer systems control power distribution, telephones and other crucial government operations.

"Developing countries have a lot left to do to immunize themselves from the Y2K bug," said Bruce McConnell, director of the International Y2K Cooperation Center, a U.N.-sponsored organization that is working with 170 nations on the glitch.

Among the laggards, though, Paraguay is particularly far behind, according to some analysts.

Not enough time

With the new year less than three months away, business and government leaders in Paraguay worry that even with a newfound commitment to eradicating the millennium bug, there is not enough time left to make the necessary patches.

"It will not be possible for us to fix everything before January," said Schafer, a former computer magazine publisher who was tapped last month ago to replace the disbanded commission. "We need to prepare for problems throughout the country -- with the telephones, electricity, water and other services our government provides."

Given that assessment, most foreign corporations and governments aren't counting on anything come January.

Inside one of Citibank's buildings in Asuncion, workers are installing a room-sized cistern that can hold enough water to keep sinks running and toilets flushing for two weeks. The firm's branch offices are being equipped with cellular and satellite phones as well as electrical generators, which will be refueled by a fleet of oil trucks hired by the bank.

The local office of DHL Worldwide Express has ordered fold-out cots in case the courier service's employees are unable to travel to and from work by public transportation. A local bank has set up an elaborate plan to deal with a total failure of electricity, telephones and water. Even the U.S. Embassy is girding for the worst, increasing its stockpile of MREs, those tear-open, ready-to-eat meals originally made for soldiers.

Because Paraguay exports only a few products outside Latin America -- largely textiles, cattle and soybeans -- Y2K problems there likely will not have a direct or immediate economic effect on the United States. But some diplomats worry that glitch-related chaos could spill across Paraguay's borders, destabilizing the nation's fragile relations with Brazil and Argentina.

'High risk'

In its final act before disbanding, the Y2K commission sent a confidential report to the United Nations saying that the government was only 20 percent along with its repairs and that, given the current pace, it would not be finished until March. Schafer recently revised that progress report downward, pegging the government at 15 percent readiness and at a "high risk" of failure.

As a consequence, Schafer said, it makes sense to plan for martial law. "If we do not have electric power, it will be impossible to give water to the citizens," he said. "Now imagine if the telephone is down too. This scenario is possible. And if that happens, what is your alternative? Martial law. There is no other choice."

Then, he paused and leaned across the table. "This," he whispered, "is a catastrophe."

-- Homer Beanfang (Bats@inbellfry.com), October 18, 1999