Politics in Venezuela -- Chávez rides high, for now

Apr 17th 2003 | CARACAS From <a href=www.economist.com>The Economist print edition EPA
Read complete story in spanish

A year after Venezuela's failed coup, its president rules in triumph over a shattered and still-divided country

ON APRIL 13th, the broad Avenida Bolívar in the heart of Venezuela's capital was a sea of flags in the national colours of red, yellow and blue, spattered with the scarlet berets of the political movement led by President Hugo Chávez. Behind the president, on his podium raised high above the crowd, was a vast billboard celebrating the “civilian-military unity” that, in official mythology at least, restored Mr Chávez and his populist “Bolivarian revolution” to power after he was briefly ousted in a coup a year ago.

Twelve months on, the balance of power in Venezuela has shifted dramatically. Mr Chávez celebrated the anniversary with an international “solidarity forum” paid for out of public funds. Those attending included Carlos Lage, Cuba's vice-president.

Venezuela The Organisation of American States explains the referendum under discussion in Venezuela.

In contrast, Mr Chávez's opponents failed even to unite in commemoration of last year's events, in which 19 of their supporters were killed. Some of their rallies were cancelled for lack of support. The opposition is battered and leaderless. It is licking its wounds after the failure in January of its second all-out bid to topple the president, this one through a two-month general strike that strangled the oil industry. The government claims that oil production is now back to normal, despite the sacking of nearly half the state oil company's workforce.

But Mr Chávez is presiding over a country dramatically impoverished by 18 months of bitter political conflict. The strike alone cost Venezuela 7.6% of its GDP, according to the National Assembly's economic advisory office. Many private firms have closed down. Since December, in one household in three a family member has lost his job, according to DatosIR, a market-research firm. Datanalisis, another survey firm, predicts a 30% drop in purchasing power this year, in a country where half the population is barely managing to subsist. Crime is soaring.

The government has imposed exchange controls, and is itself close to broke. When Mr Chávez said last month that Venezuela would have to restructure its foreign debt, finance officials quickly contradicted him. But the government faces a fiscal deficit this year of close to 7% of GDP, according to LatinSource, an economic consultancy. It is likely to press the Central Bank to print money, so inflation (31% during last year) is set to continue rising. Vegetable gardens for the poor

The president brands the opposition as fascist coup-mongers. The opposition, for its part, accuses Mr Chávez of being an elected dictator. It is unclear, however, whom the hard-pressed Venezuelans will blame for their plight. Polls showed a slight increase in support for Mr Chávez during and after the strike. But that may not last. Officials fear that hunger could erode support for Mr Chávez among the poor. Beside the Avenida Bolívar, the government is sponsoring vegetable gardens.

The next test for both sides is likely to be a mid-term referendum on Mr Chávez's presidency. Under the constitution, this could be held from August onwards. Government and opposition negotiators said last week that they had reached a “pre-agreement” to hold such a vote, after talks mediated by the Organisation of American States. But there are many obstacles. The government has not even said whether it will sign the “pre-agreement”. Although the opposition in February gathered the 2.4m signatures needed to call a referendum, it will almost certainly have to repeat the exercise. There is no electoral authority in place. The National Electoral Council's term lapsed a year ago. A new council has yet to be appointed, because of wrangling not just between the two sides but within the opposition.

All this means that the government has many ways in which to stall a referendum. If cornered, Mr Chávez could simply precipitate an election. Since he is far more popular than any single opposition leader, he might win this—unless the opposition were to unite. There are no signs of that yet. The opposition is still shell-shocked after the strike. “Everyone is depressed and dispirited,” admits an opposition source. It lacks a clear strategy as well as a leader. But the campaign for the referendum could quickly galvanise it again.

For now, the heat has gone out of Venezuela's political conflict. But neither side is interested in a lasting accommodation. The threat of violence still lurks. As the Chavistas geared up for their celebration, a bomb damaged the building in which the talks between the government and the opposition were held. Similar bombs went off at the Colombian consulate and the Spanish embassy in February. If Venezuela is indeed enjoying a truce, it is an uneasy one which shows no sign of lasting.
Read complete story in spanish