<a href=www.un.org>UN

30 May – Secretary-General Kofi Annan today welcomed the agreement signed between the Government of Venezuela and the opposition Coordinadora Democrática, and pledged continued United Nations support in helping the country to find peaceful solutions to its problems.

A statement issued by a UN spokesperson said the Secretary-General “urges all Venezuelans to take advantage of the opportunity that [Thursday’s] agreement provides to advance in the search for a peaceful, constitutional and electoral solution to the problems of their country.”

The statement also commended the international facilitators, particularly César Gaviria, Secretary General of the Organization of American States.

“The Secretary-General emphasizes that the United Nations will continue to be engaged in supporting Venezuelans as they seek peaceful solutions to resolving their differences,” the statement said.

United Press International. NewsMax.com Wires Friday, May 30, 2003

CARACAS, Venezuela – In an upscale neighborhood of eastern Caracas, demonstrators this week continued to congregate in Altamira Plaza to protest against President Hugo Chavez. A hotbed of Venezuela's political opposition during the opposition petroleum strike, the desolate plaza now looks a lot like an abandoned circus. But opposition leaders are just as agitated as they were at the height of the strike.

"He is a terrorist and a communist," says Gustavo Ramírez, 32, a student who showed up at the gathering. "He has people in the country going hungry, and he wants to ensure that there's no freedom of expression."

Though opposition sympathizers frequently levy similar accusations against their embattled left-wing president, Ramirez's condemnation was not aimed at the embattled Chavez, but rather at Cuban dictator Fidel Castro.

"President Chavez wants to turn Venezuela into another Cuba," says Ramirez, "but we can't let that happen."

Statements such as these show how Chavez's open admiration of Castro's communist revolution has infuriated Venezuela's conservative sectors and raised eyebrows in the international community. Even as the government and opposition Thursday signed a cooperation agreement that could help ease the crisis, the opposition resentment over the Cuban issue remains high.

Since the arrival of Chavez, Venezuela has signed dozens of cooperation agreements with Cuba, increased cultural exchange and provided subsidized petroleum to the Caribbean nation, much to the chagrin of Venezuelans already unnerved by what they see as Chavez's leftist agenda. Government leaders defend the new cooperation with Cuba as a way of consolidating Venezuela's social changes. But with Cuba once again in the eye of the world, the relationship may prove costly for Chavez.

A former paratrooper turned populist president, Chavez became a household figure in Venezuela after leading a failed coup in 1992. Released from jail on a presidential pardon, Chavez swept elections in 1998 on an anti-poverty, anti-corruption platform dubbed the "Bolivarian Revolution" in honor of the Venezuelan founding father, Simon Bolivar.

With a core constituency of Venezuela's burgeoning lower classes, Chavez has become a hero to the poor by promising to remake Venezuelan society. Although he has promised a peaceful revolution, Chavez often seems ideologically linked to the Latin American armed left. Faithful to his revolutionary roots, Chavez quickly increased diplomatic ties with Castro, a father figure for the Latin American left who in the 1960s sponsored Marxist guerrilla activity in Venezuela.

A year after taking office, the Chavez government signed an agreement to sell 53,000 barrels of oil a day to Cuba at subsidized rates in exchange for medical treatment by Cuban doctors. Since then, the Venezuelan government has entered into numerous cooperation agreements with Cuba, covering everything from sports training programs to urban gardens overseen by Cubans. As a result, Venezuela has become Cuba's largest trading partner.

There was little initial backlash to the new cooperation during Chavez's first years in office, when he enjoyed popularity ratings as high as 80 percent. But his excessively confrontational manner, his willingness to insult his adversaries and his decision to legislate by decree led to a steady decline in his popularity during 2001.

Watching his approval slip, Chavez' adversaries pounced on his friendship with Castro, insisting that Chavez was trying to impose a model of "Castro communism" in Venezuela. Although there is almost nothing about Chavez's economic policy that could be described as communist, his friendship with Castro has made it easy for his enemies to label him as such.

According to journalist and political commentator Clodosvaldo Hernandez, Venezuelans have such a primordial fear of communism that Chavez's flirtations with Cuba have greatly contributed to his decline in popularity.

"Chavez approaching Fidel has awakened Venezuelans terror of communism, which was successfully instilled during the era of guerrilla fighting in the 1960s," says Hernandez. "In addition, Venezuela is a very materialist society, which makes communism all the more threatening."

Hernandez points out that many poor Venezuelans, the president's core constituency, have moved away from Chavez for precisely this reason.

But government leaders such as pro-Chavez legislator Tarek William Saab say the opposition has exaggerated Venezuela's relationship with Cuba.

"We have similar cooperation agreements with dozens of other countries," says Saab, "but since it's Cuba, political leaders like to make it into an ideological issue. The issue has been magnified and exaggerated, in particular with the help of the anti-Castro lobby in Miami."

Miami, in the U.S. state of Florida, is a stronghold of anti-Castro Cuban emigres.

Nonetheless, it's hard to describe the relationship as a simple commercial exchange. The two leaders clearly share an ideology, and Chavez's move toward Cuba is an open challenge to the U.S. embargo of the island. Indeed, while U.S. authorities in May were declaring Cuba a terrorist sympathizer and expelling Cuban diplomats, Venezuela was signing 15 new agreements with the communist island.

Many speculate that the fear of encroaching communism helped drive military leaders to oust Chavez on April 11 of 2002, when 19 people were killed as an opposition march approached the presidential palace. Businessman Pedro Carmona was installed as president, but Chavez was restored to power two days later by supporters and loyalist troops.

During Carmona's government, opposition protesters surrounded the Cuban Embassy, cutting off the power and water to force hiding Chavez allies to leave the compound. The incident is frequently cited as one of the opposition's excesses, and served to strengthen ties between Castro and Chavez.

Government sympathizers such as Wilmar Perez, 42, a former taxi driver, have been drawn to the Chavez government through exchange programs with Cuba.

"The opposition criticizes Cuba because they don't know anything about it," says Perez, who was sent to Cuba for six months to receive medical attention for a gunshot wound he received on April 11. "They should continue the exchanges with Cuba. It is helping us to consolidate the revolution."

'Revolutionary Army' ... Trained in U.S.

However, political analyst Alberto Garrido insists that popular approval or discontent is not the primary issue for Chavez.

"The real problem here is the armed forces," says Garrido. "Officers fear that Venezuela's armed forces are going to be turned into a revolutionary army. And you have to remember that many of these officers have been through the U.S. School of the Americas. They were trained to fight against communism."

Garrido adds that by embracing Castro too closely, Chavez also risks upsetting the United States, which buys most of Venezuela's oil exports.

"Staying tied to Castro is an enormous liability for Chavez," says Garrido. "It means confronting people that should be his allies. How far can he really take this?"

Widespread criticism of Cuba within Venezuela indicates that Garrido has a point. But Chavez shows no sign of distancing himself from Castro, even in the face of international condemnation of Cuba's recent abuses of human rights. And Chavez, much like Castro, has never been afraid of a little healthy confrontation, meaning the Cuban issue is unlikely to disappear from the Venezuelan horizon any time soon.

Read more on this subject in related Hot Topics: Castro/Cuba Latin America Editor's note: Discover and use the CIA’s secrets Click Here Now

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Friday, May 30, 2003 By: Oscar Heck

VHeadline.com commentarist Oscar Heck writes: The Venezuelan opposition seems to be full of contradictions (again). In March 2003, opposition members who were participating in the selection process of the new CNE (National Electoral College) board stated that they were happy with the way the process was being manned. The opposition implied that the people involved in the process were acting in good faith.

Now it appears that the opposition is having problems with the process regarding the choosing of the last board member. As I understand it, this last board member is important because, apart from this, the rest of the board is 50/50 pro-opposition/pro-government (although the board is supposed to be neutral, I think).

The government suggests that the issue be brought up to the TSJ (Supreme Justice Tribunal), but it appears that the opposition has a problem with that as well, because they seem to believe that the TSJ has too many pro-government judges. Very strange.

If the TSJ was politically driven in favor of Chavez, the people involved in “the stoppage” (December 2002-January 2003) and in the April 11, 2002 coup would already be in jail for having committed acts of treason and sedition … Carlos Fernandez, Carlos Ortega, Juan Fernandez, Pedro Carmona, and a bunch of other people. (Many of these people are no longer in Venezuela. Some are in Colombia, Costa Rica and the USA).

Now, the selection of the CNE board is also important for the opposition because without this new CNE board, they will not be able to legally begin the process for a referendum against Chavez.

So, why are they stalling?

If the selection process was good for the selection of the other board members, why is it not good now?

Why is the TSJ suddenly not good either?

It doesn’t make sense ... as far as I know, the TSJ is one of Chavez’ pet peeves … Chavez is continuously complaining that the TSJ is not doing its job and implies most of the judges are supporting the opposition and are corrupt.

So, why would the opposition be stalling again (without any apparent logic)?

I believe that the opposition is starting another tactic to discredit the present Venezuelan government … again. The tactic … create all sorts of scenarios to delay the referendum then blame it on Chavez and propagate this as “news” worldwide to add to their lies that Chavez is a dictator and anti-democratic.

However, I do not think that their tactics will work because Venezuelans will not be fooled again, as some 2-3 million were conned into believing that “the stoppage” and the sabotage of PDVSA (Venezuela’s national petroleum company, one of the largest in the world) would result in Chavez leaving office.

During the months of January and February 2003, Globovision (Venezuela’s 24-hour news/commentary TV station ú and pro-opposition) had countless interviews with “petroleum” experts, politicians, etc., all of which guaranteed that PDVSA would take years to recover, blaming it all on Chavez and his incompetent government. These “expert opinions” were propagated worldwide as “news” ... however, they have all been proven wrong. PDVSA production is almost back to normal after a few short months.

In the same way, as with the issue of the CNE board selection, the opposition may be attempting to begin fabricating scenarios that they will later attempt to use as ammunition against the Chavez government.

Now, about corruption … I have been having some very interesting email discussions with a Venezuelan who has very good ideas. Corruption in Venezuela has been “a way of life” for many people … I would say mostly for the upper crust such as the leaders of the CTV (Central Union Movement), members of Fedecamaras (Chamber of Commerce equivalent), politicians, lawyers, judges, and also within the police forces. During his election campaign, Chavez had apparently promised to curb corruption and jail people who are corrupt, also promising that his government would not be corrupt. Tall order!

Most opposition people appear to think that Venezuela is more corrupt than ever and that the Chavez government is more corrupt than previous ones. I argue that corruption is probably that same still but that people are talking about it more than ever, thus appearing to be greater.

One example is that the case of corruption (for misuse of government funds) against Chavez has been thrown out of court, “Supreme Tribunal throws out corruption charges against the President.”  I also believe that if the Chavez government is so corrupt (as the opposition charges), real evidence would have come out by now, after 4 years of Chavez being in power. (There are enough people who hold economic power in Venezuela that would love to see Chavez ousted from his elected post).

The person that I have been corresponding with is disappointed with the “fact” that corruption is still rampant in Venezuela and that Chavez appears to be doing nothing about it (contrary to what he promised to do). I believe that Chavez is doing what he can, especially under the circumstances (attempted coup, “the stoppage”, sabotage, etc).

First of all, if Chavez, or the Chavez government, jails people for being corrupt without going through the legal system, then Chavez and company would be acting as dictators ... not something that Chavez needs. Secondly, as far as I can see, the Chavez government is taking the legal approach to the problem of corruption. Some examples: working on the passing of anti-monopoly laws, implementing land reform, applying anti-speculation/hoarding laws (such as the seizing of hoarded chicken) and digitalizing information (such as at two of the main customs installations).

It is also important to realize that most fraud/corruption cases take years to resolve, even in countries such as Canada or the USA.

To add to the difficulty, in Venezuela, the TSJ is in disarray and the overhaul of the seemingly corrupt and inefficient TSJ has been apparently continuously hampered by anti-government interests. Without a solid and politically-neutral TSJ, anti-corruption laws will be very difficult to implement.

Overall, I believe that eradicating corruption from the mainstream of Venezuelan society will take years, probably 1-2 generations. (In Venezuela, even if a person believes that corruption is not a good thing, the person will often participate in corruption because if she/he doesn’t, then she/he will be the loser).

I believe that Venezuelans must be patient.

Chavez (or anyone else) can not quickly and magically change “traditional” habits that have been around for so many years.

Oscar Heck Oscar@VHeadline.com

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Friday, May 30, 2003 By: David Coleman

No date has yet been set for a revocatory referendum on the rule of Venezuelan President Hugo Chavez Frias, but government and opposition negotiators have signed an agreement which obliges both sides to put aside a political conflict and to abide strictly by the terms of the 1999 Constitution to hold the referendum in a process which may be initiated after reaching the half-way point in the President's 6-year mandate this coming August 19.

Under the Constitution, which was itself approved by a democratic majority on December 15, 1999, a recall referendum can be held if Presidential opponents are able to collect signatures from at least 20% of duly registered voters.

Chavez Frias was first elected in December 1998, but opposition diehards -- who staged a violent but abortive coup d'etat on April 11, 2002 -- claim he may try to avoid a referendum. Movimiento al Socialismo (MAS) deputy Felipe Mujica says "this a President who permanently fails to keep his word."

Nevertheless, Organization of American States (OAS) secretary general Cesar Gaviria was at the signing ceremony Thursday with Executive Vice President Jose Vicente Rangel and opposition representatives.  He said "this is a good agreement for all Venezuelans."

President Hugo Chavez Frias

Rabid opponents to President Chavez Frias' reform government accuse him of assuming near-dictatorial powers after he gaining majority support in the National Assembly (AN), quote a few nutters even go so far as to claim Chavez Frias is attempting to install Cuba-style communism in Venezuela despite abject denials from all quarters in government.

While opposition warlords maintain their vicious grip over much of what is going on in the provinces, the Venezuelan opposition is now pledged with the government to avoid violence in the run-up to the Constitutionally-mandated referendum process which is seen most likely to get off the ground in November or early December.

• But first the National Electoral College (CNE) must designate its own board of directors, verify valid signatures in a traditionally out-of-date roll of registered voters and set a target date for the referendum to be held.

Meanwhile, a series of hurdles must be surmounted even though they are not of the President's making ... voter records are said to include listings corruptly included of deceased voters from several decades back and political parties have yet to appoint representatives to monitor the vote when, and if, it happens...

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Friday, May 30, 2003 By: Jose Gregorio Pineda & Jose Gabriel Angarita

VenAmCham's Jose Gregorio Pineda (chief economist) and Jose Gabriel Angarita (economist) write: The economic agents in search of a way to meet their avid demand for US dollars have resorted to buying telephone company (CANTV) shares as a way to get around the total absence of legal foreign exchange availability. The shares, bought on the Venezuelan capital market, are brought together in a portfolio of 7 and turned into American Depositary Receipts (ADR), CANTV securities listed on Wall Street.

The arrangement is as follows: Once the shares have been converted into an ADR, it is sold in the United States and the value of the transaction deposited in an overseas account belonging to the seller.

This has three important consequences: An effect on the price of CANTV stock, an effect on the Caracas Stock Exchange (BVC), and the reaction of authorities responsible for operating the exchange control system.

First, the price of CANTV stock has risen 54% so far in 2003, according to figures published by El Universal, to 3,785 bolivares.  Second, stock trading in Venezuela has grown and the BVC Index had climbed to a record 11,532.92 points by Wednesday, May 28. But the most controversial of these consequences is the reaction of public officials responsible for regulating the economy.

Finance (Hacienda) Minister Tobias Nobrega announced that an important announcement on these transactions will be made in the next few days, but made it clear that they are in no way illegal. On the contrary, he acknowledged that this procedure is not regulated in the exchange control rules. Members of the CADIVI board, on the other hand, said these transactions are not authorized by the rigorous exchange control system and criticized their speculative nature.

For the time being, the transactions show that the price of a dollar on that market is in the neighborhood of 2,300 Bs./US$ ... but if they came to be regulated, the foreign exchange market's shutdown would be more complete, and hence, the negative effects of the exchange control regime would become even stronger, driving up the black-market exchange rate.