www.voanews.com VOA News 23 Jan 2003, 23:00 UTC

Venezuelan authorities say one person has been killed and at least two others injured following an explosion near a large pro-government demonstration in the capital, Caracas.

Police say the incident happened Thursday as President Hugo Chavez was addressing hundreds of thousands of his supporters at the rally.

The demonstrators were protesting a long-running anti-government general strike that has crippled the country's economy, especially the vital oil industry. Before the strike, Venezuela was the world's fifth-largest oil exporter, producing more than three-million oil barrels per day.

Meanwhile, the Bush Administration has endorsed two proposals by former U.S. President Jimmy Carter to resolve the Venezuelan crisis.

Mr. Carter's proposals, released earlier this week in Caracas, call for either a constitutional amendment that would trigger early elections or a national referendum in August on President Chavez's rule. In return, the opposition would be required to end the strike.

The opposition has demanded a referendum on Mr. Chavez' rule, but the president insists the constitution only allows for a vote in August, halfway through his term.

The U.S. endorsement comes as top diplomats from six countries prepare to meet in Washington Friday to discuss a resolution to the crisis. The six countries are known as the "group of friends" of Venezuela.

www.heraldtribune.com The Associated Press

A growing consensus has emerged among Latin American nations on the need to coordinate their efforts to combat drugs and terrorism, the head of the U.S. Southern Command said Thursday.

Gen. James Hill said a two-day meeting of U.S. ambassadors to seven Latin American countries at SouthCom underscored the importance of increased communication and coordination to battle the drug networks that help fund terrorist groups.

"The problem in Colombia is Brazil's problem. The problem in Colombia is Chile's problem. The problem in Colombia is Argentina's problem. And they're all going to have to work together," Hill said.

U.S. ambassadors to Bolivia, Brazil, Colombia, Ecuador, Panama, Peru and Venezuela took part in the Andean Ridge Chiefs of Mission Conference that concluded Thursday.

The U.S. military has taken an expanded role in recent months in Colombia, where rebels have waged war for 38 years against a succession of elected governments.

Anne Patterson, U.S. ambassador to Colombia, told reporters this month that 70 U.S. Army trainers had arrived to train 6,500 Colombian soldiers for three months to protect a key oil pipeline from attacks by rebels.

The deployment of the members of the 7th Special Forces Group, based at Fort Bragg, N.C., followed a Congress-approved decision by the Bush administration that U.S. military assistance should be expanded into helping Colombia combat the rebels.

Previously, U.S. military aid and training was restricted largely to battling cocaine production, which rebels and rival paramilitary gunmen profit from, fueling the war.

Hill said the region's most pressing problem includes the "growing influence of drug money and drug corruption on democracies.

"It is pervasive and it is destabilizing and that's something that we all have to take a hard look at," Hill said.

Hill said officials had a "free-ranging" discussion about the recent political turmoil in Venezuela with U.S. Ambassador Charles Shapiro but declined to elaborate. He said SouthCom continues to monitor the situation like any other country in the region.

"That is a situation that's up to the people of Venezuela acting in construct within their own democracy to work out, not for SouthCom," Hill said.

Southern Command oversees U.S. military activities in 32 nations and 12 dependencies, from Guantanamo Bay Naval Base in Cuba to Plan Colombia, the $1.7 billion aid project to strengthen Colombia's military and counter-drug operations.

www.forbes.com Reuters, 01.23.03, 6:14 PM ET

CARACAS, Venezuela, Jan 23 (Reuters) - The Venezuelan government plans to offer a $300 million domestic debt swap as it struggles with a fiscal crisis deepened by a seven-week-old opposition strike, banking sources said on Thursday.

The swap to extend maturities of bonds would offer an exchange of National Public Debt (DPN) bonds due between the end of this week and next Monday for new issues coming due at least eight months later, the sources said.

Finance Ministry representatives met Thursday with bankers to explain the difficulties the government faced covering the upcoming payments on National Public Debt notes and also to offer them the bond swap, one banking source told Reuters.

"The banks can go into the swap voluntarily and the consensus seems to be to accept it. No one wants a default," said a source who asked not to be identified.

Finance Minister Tobias Nobrega on Wednesday announced that the government would carry out domestic debt exchanges as part of a plan to counter the impact of the strike in the world's fifth largest oil exporter.

The stoppage, staged by opposition leaders and dissident oil workers demanding President Hugo Chavez resign, has drained government coffers by slashing oil production and exports which provide nearly half of state revenues.

About half of the 540 billion bolivars in notes available for the swap are with public institutions, the sources said, with about 130 billion bolivars worth held by private banks, and the remainder spread between public and private trust funds. The Central Bank will conduct the exchange, they added.

The swap would be similar to the auction conducted at the end of last year when the government extended for one to five years maturities on $2 billion in domestic debt -- about 37 percent of the total domestic public debt due between December 2002 and June 2005.

With more than 75 percent of the country's domestic debt maturing during that period, the government hoped the swap would smooth out a crunch in payments over the next two years.

The government has also slashed its 2003 budget and suspended foreign exchange trading to halt capital flight and stop the sharp slide in the local bolivar currency. The bolivar has been battered by strong demand for U.S. dollars as investors look for safe haven from Venezuela's economic crisis. (Reporting by Silene Ramirez, additional reporting by Ana Isabel Martinez, editing by Gary Crosse; Reuters Messaging: silene.ramirez.reuters.com@reuters.net, 58-212-277-2656, pat.markey@reuters.com)

www.vheadline.com Posted: Thursday, January 23, 2003 - 4:52:41 PM By: Patrick J. O'Donoghue

The Friends of Venezuela Group consisting of the USA, Brazil, Mexico, Portugal, Chile and Spain will hold its first meeting tomorrow in Washington.

Spain’s Foreign Minister Ana Palacio says she hopes it will help create a climate of dialogue between the Venezuelan government and opposition.

“The first meeting will to place the ideas on the table but the most important thing will be to overcome the highly polarized situation and promote an understanding.”

The Friends of Venezuela Group was the initiative of Brazilian President Lula da Silva to facilitate a solution to Venezuela’s stalemate negotiation process.

www.guardian.co.uk Thursday January 23, 2003 10:30 PM

CARACAS, Venezuela (AP) - Hundreds of thousands of Venezuelans marched through Caracas on Thursday to pledge their loyalty to President Hugo Chavez and protest a 53-day-old strike intended to unseat him.

An explosion near a subway station a block from the march killed one person and injured 14, Fire Chief Rodolfo Briceno said. The cause of the blast wasn't immediately known.

Buses from across the country, swathed with red banners and red, yellow and blue Venezuelan flags, poured into the capital for the show of support for Chavez. Briceno estimated the number of demonstrators at more than 300,000.

Ooh! Ah! Chavez isn't leaving!'' demonstrators chanted as they snaked onto a highway, headed for a downtown rally. Marches formed in other parks and demonstrators exploded powerful noisemakers - known as Bin Ladens'' - that have become a hallmark of the pro-Chavez movement.

The outpouring of support marked the 45th anniversary of the fall of the country's last dictator, Gen. Marcos Perez Jimenez. It also came a day before the first meeting of the ``Group of Friends,'' six nations that have offered to help Venezuela find a way out of its crisis.

The meeting will consider two plans presented this week by former President Jimmy Carter to end the strike and hold early elections.

Chavez said late Wednesday he welcomed international help but warned against outside intervention in Venezuela's internal affairs. He urged the group - Brazil, Chile, Mexico, Portugal, Spain and the United States - to recognize that his is an elected government and to not give equal weight to what he calls a coup-plotting opposition.

Diplomats from the six nations were to meet Friday at the Washington headquarters of the Organization of American States with OAS Secretary General Cesar Gaviria, who is mediating talks between the government and opposition.

Chavez said Wednesday he still wants to expand the group to include such nations as China, Russia, Algeria, Saudi Arabia and France. But Gaviria said the group of six was picked for balance and to be of a size that is manageable.

Venezuela played a similar role with other countries in trying to end the Central American crisis in the 1980s.

Opposition leaders asked their supporters in Caracas to stay home Thursday to lessen the chance of clashes with pro-Chavez marchers.

They contend Chavez's leftist policies have damaged business and scared away foreign investment. They called the strike on Dec. 2 to force him out. The strike has damaged Venezuela's key oil industry, the world's fifth-largest exporter and a top supplier to the United States.

In a victory for Chavez, the Supreme Court, citing a technicality, on Wednesday postponed a Feb. 2 nonbinding referendum that would have asked Venezuelans whether Chavez should quit.

Opposition marchers delivered 2 million signatures in November demanding the referendum.

Venezuela's constitution permits a binding referendum halfway through a president's term, which in Chavez's case would be August.

Demonstrators tore down a huge billboard that opponents had erected to count down the days to the now-postponed referendum.

The strike has affected world oil prices, and the government admits losing $4 billion in since the strike began. But there were signs that the oil strike may be easing.

The state news agency Venpres quoted Ali Rodriguez, president of the state owned oil monopoly Petroleos de Venezuela S.A., as saying most blue-collar workers and half of administrators had returned to work. Rodriguez also said crude production has surpassed 1 million barrels per day.

PDVSA employs 40,000 people, about half of them blue collar workers.

Striking executives challenged Rodriguez's figures, but acknowledged that Venezuela had raised its daily oil production to 714,000 barrels. Pre-strike production was about 3.2 million barrels per day.

A severe gasoline shortage and increasing scarcity of other consumer goods has put nerves in this country of 24 million on edge. Facing an economic crisis, the government Wednesday suspended for five business days all foreign currency trading. Venezuelans worried about the future of their currency, the bolivar, have been rushing to buy U.S. dollars to protect themselves.

Traffic in downtown's usually bustling streets slowed to a trickle Thursday. Steel doors, often covered with pro-Chavez graffiti, closed over most businesses.

``Chavez until 2021,'' read one. Chavez's term ends in 2007, but he has said he hopes to rule well beyond that.

The mood was boisterous in Parque del Este where one march formed.

Nobody can get rid of Chavez,'' said Candida Gutierrez, a homemaker who came from El Tigre, 500 miles to the east, to take part. We have Chavez for awhile.''

Marchers waved flags bearing the image of Ernesto ``Che'' Guevara, a hero of the Cuban revolution. Chavez is an avid admirer of Cuban leader Fidel Castro.