Uruguay pulp mill protest draws 100,000 Argentines

BUENOS AIRES, Argentina, Apr 30 (Reuters) Nearly 100,000 people marched near the Argentine city of Gualeguaychu today to protest a pulp mill project in Uruguay that they fear will pollute the river dividing the two nations.

This latest demonstration follows months of sporadic roadblocks imposed by environmentalists and local residents on a highway linking the countries, protests that Uruguay says have cost its economy some 400 million dollars.

Tens of thousands of flag-waving Argentines clogged the roadway and the bridge leading to Fray Bentos in Uruguay, where Finland's Metsa-Botnia and Spain's Ence have begun work on a 1.7 billion dollars pulp mill project.

''We demand that politicians guarantee sustainable economic and environmental development and that they respect the quality of life and the biodiversity in the Uruguay River basin,'' said a protester who was reading aloud the marchers' manifesto.

Argentina asked that construction be halted for 90 days so that more environmental studies could be done, but presidential-level talks collapsed in early April after Metsa-Botnia announced it would only stop work for 10 days.

The government of center-left President Nestor Kirchner has vowed to challenge the mills at an international court in The Hague, saying they violate bilateral accords related to the management of the Uruguay River.

Kirchner has gathered provincial governors from throughout Argentina to attend a protest on Friday in Gualeguaychu to demand a temporary halt to building.

Uruguay has asked that the Mercosur customs union -- whose full members include Uruguay, Argentina, Brazil and Paraguay -- intervene in the conflict, and has threatened to seek recourse at the Organization of American States.

Earlier this month, the World Bank's private sector arm decided to withhold approval of about 400 million dollars in funding for the pulp mills until it completes studies on the project's social and environmental impact.

The mills represent the largest-ever industrial investment in tiny Uruguay, located between Argentina and Brazil on the Atlantic coast. Uruguay's government says the pulp companies will use the latest technology to avoid polluting.

A Finnish minister canceled a trip to Argentina this month, saying she did not feel she would be welcome after Kirchner criticized Finland for not helping to resolve the conflict.

REUTERS DH RK0220