Magazine article Newsweek International

Will the Bug Bite?: The Year-2000 Computer Glitch Could Give Poorer Countries Some Trouble

Magazine article Newsweek International

Will the Bug Bite?: The Year-2000 Computer Glitch Could Give Poorer Countries Some Trouble

Article excerpt

The world's biggest copper and gold mine is not easy to get to. It's a huge hole in the top of a remote mountain in the Indonesian province of Irian Jaya. New Orleans-based Freeport McMoran operates the mine, which it calls Grasberg. Freeport relies on local companies to obtain goods and trundle them to the dig site, where 14,000 people work. Though long, the supply chain is dependable--for now. But on Jan. 1, 2000, it's possible that some key computer systems in Indonesia's infrastructure may go haywire. Freeport is taking no chances. "We haven't had to do anything draconian like change suppliers," says Bill Harris, the company's Y2K- compliance manager. "But we now have our own power stations, so we aren't dependent on the state electricity company." Freeport has also stockpiled enough fuel, food and medicine to last 45 days.

In the rich countries of the world, Y2K concerns now focus on champagne rather than antibiotics. The bulk of the $300 billion or more that the GartnerGroup, a U.S. research group, estimates it will cost to fix the now infamous software bug is being spent in the United States, Europe and Japan, with reassuring results. Sure, some scattered computer systems in the advanced world may malfunction after mistaking the year 2000 for the year 1900. But overall, most things should function on Jan. 1 much as they will the day before: lights will go on, trains will run, factory robots will swing their arms.

In the poorer parts of the world, though, things are looking a little dicier. It's not that the globe's legions of Y2K consultants fear the worst; Russia's ballistic missiles are unlikely to be launched, and Soviet-designed nuclear reactors probably won't melt down. But the Y2K crowd continues to fret about the kinds of disruptions that Freeport McMoran is guarding against in Indonesia. In countries as varied as Russia, China and the Czech Republic, software fixes and testing have lagged--and money to update computers has been scarce. The cash crunch produced by the Asian financial contagion just made matters worse.

Now, with time running out, developing nations are rushing to stave off trouble. With repair jobs and software testing incomplete, many are hurrying to put contingency plans in place, in the event that their networks really do come crashing down. Brazil, for example, appears in relatively good shape. Nevertheless, the government is beefing up its fire and police brigades and putting Army troops on "high alert" for the transition period. The Brazilian government has asked telephone users to keep their year-end gabbing to a minimum. "If everyone takes their phone off the hook on Jan. 1 to see if it works, we're going to have a big problem," says Solon Lemos Pinto, the head of Brazil's year-2000 program. The inspector general of the U.S. State Department recently told Congress that "anywhere from 52 to 68 developing countries have a medium to high risk of Y2K failures in the telecommunications, transportation and/ or energy sectors."

The disruptions will be felt most severely in their countries of origin-- but may also ripple through the global economy. Would a two-week shutdown of Grasberg be a catastrophe? No. But it sure would be a headache for companies that make electrical wires, which might be hit by higher copper prices. As Lawrence Gershwin, an intelligence officer with the U.S. Central Intelligence Agency, put it: "Global linkages virtually guarantee that Y2K problems will not be isolated to individual countries." Multinational companies--which operate many of those global linkages--are doing their best to be ready. General Motors, whose Y2K preparation costs will total $800 million, has established a dozen command centers to monitor its global manufacturing operations and those of 40,000 crucial suppliers.

Predicting just where Y2K failures will occur, and how severe they will be, is nearly impossible. Most consultants have based their readiness assessments on surveys, but governments and state agencies have been loath to report on their computer-repair efforts. …

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