www.nytimes.com By TONY SMITH

PORTO ALEGRE, Brazil, Jan. 24 — Urging the rich world to make peace not war, President Luiz Inácio Lula da Silva pledged today to champion the cause of all poor countries when he addresses the World Economic Forum in Davos, Switzerland, this weekend.

Raising whoops and cheers from a crowd of tens of thousands of antiglobalization activists gathered in this southern Brazilian city for the third annual World Social Forum, Mr. da Silva promised that his message to the cream of international finance and politics meeting in the Swiss Alps would be blunt.

"A lot of people in Davos don't like me, although they don't even know me," the Brazilian president said. "But in Davos I will say exactly what I say here.

"We need a new world economic order that distributes wealth more fairly," he said, "so that impoverished countries have a chance of becoming less impoverished, so that African babies have the same right to eat as a blond, blue-eyed baby born in Scandinavia."

Mr. da Silva, a former metalworker and union leader won a landslide election victory in October, but he has been savaged by the radical wings of his Workers' Party and the antiglobalization movement for agreeing to attend the World Economic Forum, seen here as antithetical to Porto Alegre's grass-roots meeting.

But his address today touched all the right buttons with the crowd, which gathered at a riverside park.

The loudest cheers came when Mr. da Silva, standing on a stage draped with a banner reading "No to Imperialism! Against the Imperialist War!" spoke out against a possible war against Iraq.

"The world doesn't need war, it needs peace and understanding," he said. "I often wonder why, instead of spending billions and billions of dollars on arms, they don't spend it on bread, rice and beans that could help feed the poor of the world."

However radical his speech at Davos may be, Mr. da Silva will also have to strike a more pragmatic note behind the scenes when he confers with the international movers and shakers there.

Fears — so far unfounded — that Mr. da Silva might steer Brazil off the free-market course that it has plied for the past decade, sent the country's currency, stock and bond markets tumbling last year, and they are only just recovering.

With foreign investment in the country slowing, Brazil must export more to keep its books balanced. But to do that its cash-starved exporters need credit lines from abroad, and hundreds of millions of dollars worth of them, cut off during the election campaign, have yet to be restored.

For now, by appointing a market-friendly finance minister and central bank chief, Mr. da Silva has managed to keep the financial markets healthy, while still talking tough about redressing Brazil's appalling gap between haves and have-nots.

He also gained a vote of confidence on Friday from Anne Krueger, the first deputy managing director of the International Monetary Fund, which last year approved a $30 billion loan package for Brazil. Speaking in Davos, Ms. Krueger said the new Brazilian government's efforts to maintain fiscal and monetary discipline were "a step forward."

Mr. da Silva might be walking a tightrope, but most analysts agreed he had to play both sides to start a dialogue between rich and poor.

"The reality is that he has to have a foot in both worlds," said John Schmitt, a labor economist from Washington. "A dialogue has to be possible."

Ex-Leftist In the Center As Brazil Votes Again

www.guardian.co.uk Saturday January 25, 2003 12:40 AM

PORTO ALEGRE, Brazil (AP) - Anti-globalization protesters greeted Brazil's new leftist president like a rock star at the World Social Forum on Friday, cheering the one-time revolutionary as one of their own.

President Luiz Inacio Lula da Silva told a crowd of tens of thousands that he will fight Brazil's grinding poverty and rampant corruption, oppose war and urge rich nations to help bring the Third World out of misery.

``I want to tell the world 'What a wonderful world it would be if instead of spending money on arms and war, the rich world would spend its money on buying food,'' the recently elected president said to thunderous applause.

Activists waving bright red flags chanted ``Lula! Lula!'' - as Silva is popularly known.

Silva, who was inaugurated on Jan. 1, earlier had breakfast with the socialist mayor of Porto Alegre, talked with forum organizers and held an afternoon meeting with former Portuguese President Mario Soares, founder of Portugal's socialist party.

Soares said Silva, who has made fighting hunger in Brazil his top priority, is ``real proof that there can be social participation in government.''

Hundreds of Brazilians and foreigners attending the six-day forum chanted ``Lula! Our President!'' when Silva visited Porto Alegre's state government palace earlier Friday.

Some 100,000 activists are attending more than 1,700 sessions and workshops on topics ranging from corporate misdeeds to Third World debt as a counterpoint to the World Economic Forum being held simultaneously in Switzerland.

Silva spoke on the same stage where Brazilian pop stars like Jorge Ben Jor are putting on shows at the end of each day of the forum.

There's never been a president of Brazil who's been a laborer,'' said Emilio Penna, a 26-year-old Uruguayan university student. Politics have always been in the hands of the rich.''

Silva also defended his decision to travel to the Swiss alpine resort on Saturday to join the meetings of government and business leaders that are the focus of the protests in Brazil.

Many people in Davos don't like me and don't want to meet me,'' he said. I want to make a point of going to Davos and saying to them that it is not possible to have an economic model where a few people eat five times a day and many people go five days without eating.''

The son of a poor farmer, Silva dropped out of school to help support his family and became a symbol of hope for Latin America's impoverished millions after his landslide election in October.

In an indirect reference to a possible U.S.-led war against Iraq, Silva told forum organizers he is against war to resolve international conflicts, according to foreign relations adviser Marco Aurelio Garcia.

Later, in his speech, he said it makes no sense for countries to spend billions of dollars on war while millions of children don't get enough to eat. And without naming the United States, he criticized the U.S. economic embargo against Cuba.

Crowds mobbed the smiling president when he arrived in a motorcade at his hotel late Thursday night. Frustrating his security detail, the former union leader spent 10 chaotic minutes shaking hands and hugging admirers outside the hotel and inside its lobby.

Some activists were critical that Silva was going to mingle with the rich and powerful in Davos, but others conceded it's only natural that he would attend both events now that he's president of the country with the planet's fifth-largest population and 12th-biggest economy.

He is a symbol of new hopes that a poor country can solve its problems,'' said Brazilian electronics salesman Eduardo Martins da Costa, 34. And he has to speak more rationally now, not with as much radicalism like he did before.''

www.news-journal.com By KEN GUGGENHEIM Associated Press Writer

WASHINGTON (AP)--Officials from the United States and five other countries urged Venezuelans to stop political violence and inflammatory rhetoric as a new diplomatic effort began Friday to end a violent strike that has crippled oil production in the world's fifth-largest oil exporter.

The newly formed ``Friends of Venezuela'' group also agreed to send high-level representatives to a meeting in Caracas next week to help find ways to break the political impasse.

The opposition called the strike almost two months ago to press demands that President Hugo Chavez resign or call early elections. Opponents say Chavez's leftist policies have undermined business in Venezuela; Chavez's supporters say the opposition wants to bring down a democratically elected president who enjoys strong support among the nation's many poor.

``The problem of Venezuela is a problem of great urgency that requires therefore that we act immediately,'' Brazilian Foreign Minister Celso Amorim, who chaired the meeting, told reporters afterward.

In a sign of U.S. interest in a diplomatic resolution, Secretary of State Colin Powell attended the start of the closed-door meeting at the Organization of American States that also included officials from Mexico, Chile, Spain and Portugal.

Powell said the diplomats should work with two proposals made by former President Carter. One proposal is for a recall vote on Chavez to be held in August. The other would be to amend the Venezuelan constitution to allow early elections this summer.

``The Carter proposals represent the best path available to the Venezuelans. They provide the badly needed basis on which both sides can bridge their differences on the immediate issues,'' Powell said, in a text released by the State Department.

Venezuela's foreign minister, Roy Chaderton, told reporters his country was open to proposals that follow the country's constitution. He also agreed that both sides need to lower the tone of the political rhetoric but said: ``We do need guarantees also, because we have a very violent and irrational opposition.''

Chaderton said he would like to see the Friends group expanded eventually to include other friendly nations. Amorim said a possible expansion was not discussed at the meeting.

Miguel Diaz, of the Center for Strategic and International Studies, said the talks at the OAS were critical.

If this doesn't pan out, I think Venezuela is left to its own devices,'' he said. I'm not sure the Venezuelans themselves will be able to find their way through this crisis without major bloodshed.''

The United States has approached the latest Venezuelan turmoil gingerly. The Bush administration has little regard for Chavez, who has visited Iraqi President Saddam Hussein and is a close friend of Cuban President Fidel Castro. But after stressing the importance of democracy to the region, it doesn't want to be seen as undermining a constitutionally elected government.

The administration received sharp criticism for appearing to support a coup attempt in April. It has said it opposes any change in Venezuela outside the constitution.

Chaderton said he viewed the United States as ``a good friend.''

Michael Shifter of the Inter-American Dialogue research group said the April coup has caused the United States to take ``more of a hands-off posture'' to Venezuela.

That's not an answer because the chaos is continuing,'' he said. The United States is one of the few actors that could positively affect the outcome of this.''

While the United States is seen as being able to influence Venezuela's opposition leaders, Brazil's new government, led by leftist President Luiz Inacio Lula da Silva, is seen as potentially influential with Chavez.

On the Net: OAS: www.oas.org

www.charlotte.com Posted on Sat, Jan. 25, 2003 TRUDY RUBIN KNIGHT RIDDER

DAVOS, Switzerland - The annual gathering of the world's top economic and political leaders at the World Economic Forum in this Alpine village mirrors the mood of the powerful.

To say they view the future with foreboding would be an understatement.

In the late '90s, Americans were giddy over the soaring stock market and Europeans over the introduction of the euro. They grew high anticipating the miracles of a dot-com economy. With a brief blip of concern over the Asian financial crash of 1997, most years were upbeat -- until the dot-com crash decimated the markets and al-Qaeda destroyed the twin towers.

But even last year, when the conference moved temporarily to New York City, the mood was optimistic. The revelations about Enron cast a shadow, but the we-will-rise-again aura was encapsulated by a gala soiree on the stock market floor a couple of blocks from ground zero.

This year is different. During 2002 one corporation after another was tarnished by scandal, the U.S. economy has barely recovered, and an Iraq war looms. The tone of this year's Davos is somber.

The theme of this year's meeting is "Building Trust," trust in business and politics and even religion. A recent global public opinion survey conducted by the forum showed 48 percent of those surveyed in 15 countries had little or no trust in global companies and 51 percent felt the same about their parliaments or congresses.

So this year's Davos includes such mea culpa panels as "Understanding the Loss of Political Trust" and "The Dot-com Boom: How Did We Get It So Wrong?"

What's most striking about Davos 2003, however, is that there are no bright spots. In years past Davos leaders would at least have trusted the U.S. economy to pull the world out of its economic doldrums, as it did during the Asian crisis.

This year there are no star countries or regions. The United States is still the 800-pound economic guerrilla.

But leading economists here are uneasy about the economic impact of an Iraq war, at a time of growing U.S. trade and fiscal deficits.

Once upon a time, Davos delegates waited for Robert Rubin, Bill Clinton's treasury secretary, to take the stage as if he were the leader of a rock band. This year, they are waiting for Secretary of State Colin Powell with trepidation, looking for hints about whether there will be an Iraq war. (Bill C. himself, who's coming as a private citizen, will probably get a warm welcome.)

Europeans, meanwhile, are sulking, as Germans and Italians wrestle with no-growth economies (ditto for Japan). No top European leaders even came to Davos this year. Perhaps the French and Germans didn't want to spread discord at Davos by publicly airing their grievances with the Bush team over Iraq.

There always has been friendly rivalry here between Europeans and Americans, even some sniping. But this year, European public opinion is so hostile to American policies that hours of Davos sessions are devoted to how to bridge the continental divide and how to deal with "American omnipotence."

In this conference of mega-capitalists, the world leaders getting biggest billing at Davos are the new leftist leader of Brazil, "Lula" da Silva, and the new neo-Islamist leaders of Turkey. The economy that is getting the most compliments is the People's Republic of China.

There is a palpable sense that the world is heading toward great uncertainty. In past years, Davos always prided itself on holding sessions that brought warring parties together in highly publicized peace efforts -- Yasser Arafat and Shimon Peres in the old days, Balkan leaders during the Bosnia crisis.

Peres is back, but is meeting only with a minister of the Palestinian Authority, which Israel's government has virtually dismantled. Eight Iraqi opposition leaders are being given a total of 35 minutes to explain how they could bring democracy to post-Saddam Iraq.

No one is certain whom to trust, not George W. Bush, not European leaders, not international institutions like the United Nations that don't have real power. So the subject matter at Davos this year is right on the money.

It reflects a world whose economic and political leaders are groping in the dark.

Trudy Rubin is a columnist and editorial-board member for the Philadelphia Inquirer. Readers may write to her at: Philadelphia Inquirer, P.O. Box 8263, Philadelphia, Pa. 19101, or by e-mail at trubinphillynews.com.

www.agi.it

FAZIO: CRISIS "OVERCOME" IN LATIN AMERICA, BACKS LULA (AGI) - Agrigento, Italy, Jan 25 - The crisis in Latin America is of great concern to the governor of the Bank of Italy, Antonio Fazio. During his speech at the Forex convention in Agrigento he expressed some optimism, saying that Argentina had "got over the critical phase" and endorsed the new Brazilian leader, Ignacio Lula da Silva.

   "In Brazil the reduction in political and institutional uncertainty has already had a positive effect on the currency and long-term interest rates," he said. "This is making the prospect of the central bank becoming fully independent from the government set-up ever more likely". In Argentina, added the governor, "awareness of a new structure for the central bank could help them find a monetary equilibrium after the bad experience they had with their currency board". Giving the thumbs-down, as always, to anchoring it to the dollar, Fazio explained that "the currency devaluation created conditions for competition on the international market". Furthermore, "the re-worded agreement with the International Monetary Fund shows that the most critical phase is over". (AGI)