GEORGE GEDDA, Associated Press Writer Friday, January 3, 2003

(01-03) 15:42 PST WASHINGTON (AP) --

The Bush administration on Friday brushed aside suggestions that Brazil's new leftist president is ready to form an alliance with leaders from Venezuela and Cuba.

Brazilian President Luiz Inacio Lula da Silva displayed friendship toward Presidents Hugo Chavez of Venezuela and Fidel Castro of Cuba in the aftermath of Silva's inauguration on Wednesday.

Chavez has even dubbed the troika a Latin American "axis of good." Silva had breakfast with Chavez on Thursday and dinner with Castro that night. Beforehand, Castro said Lula's election augured well for Cuban-Brazilian relations.

Responding to the suggestion of an axis unfriendly to the United States being formed, State Department spokesman Richard Boucher said, "Let's get serious. These are three different leaders with different nations and different interests."

"We have an excellent relationship with Brazil, and we look forward to building on that relationship," Boucher said.

He also said both Venezuela and Brazil share the democratic values enshrined in hemispheric agreements.

In contrast, he said, "Cuba remains a stark exception to those values."

He said the United States can cooperate with Brazil and support a democratic path in Venezuela as it faces the challenge of overcoming deep political divisions.

Shortly after his election in October, Silva told an interviewer the Cuban revolution, now 44 years ago, held little appeal for Brazilians nowadays.

Michael Shifter, an analyst at the Inter-American Dialogue research group, said Silva's display of friendship toward Chavez and Castro was a means of making a gesture to his leftist supporters at home.

"Having meetings with Chavez and Castro is a way to satisfy his base for now," Shifter said. "I can't imagine him going in the direction that Chavez and Castro have gone."

Shifter said Silva's statements and his appointments to key economic posts suggest that his economic policies may be similar to those of his predecessor, Fernando Henrique Cardoso.

One test of Brazil's relations with Venezuela could be Silva's response to Chavez's request for technical experts from Brazil's state-owned oil company to replace some of the 30,000 Venezuelan state oil workers who have joined a crippling nationwide strike.

President Bush dispatched U.S. Trade Representative Robert Zoellick as his personal representative at the inauguration.

The selection was seen by some Brazilians as a snub because Zoellick suggested last October that Brazil's only trading partner would be Antarctica if it did not join a proposed hemispheric free trade zone.

Silva responded by calling Zoellick "the sub secretary of a sub secretary of a sub secretary" during his election campaign. Zoellick is a member of Bush's Cabinet.

Zoellick is expected to have extensive dealings with Brazil as part of Bush's goal of a hemispheric free trade agreement by January 2005.

U.S. Brushes Off Talk of 'Axis of Good' By GEORGE GEDDA Associated Press Writer

WASHINGTON (AP)--The Bush administration on Friday brushed aside suggestions that Brazil's new leftist president is ready to form an alliance with leaders from Venezuela and Cuba.

Brazilian President Luiz Inacio Lula da Silva displayed friendship toward Presidents Hugo Chavez of Venezuela and Fidel Castro of Cuba in the aftermath of Silva's inauguration on Wednesday.

Chavez has even dubbed the troika a Latin American ``axis of good.'' Silva had breakfast with Chavez on Thursday and dinner with Castro that night. Beforehand, Castro said Lula's election augured well for Cuban-Brazilian relations.

Responding to the suggestion of an axis unfriendly to the United States being formed, State Department spokesman Richard Boucher said, ``Let's get serious. These are three different leaders with different nations and different interests.''

``We have an excellent relationship with Brazil, and we look forward to building on that relationship,'' Boucher said.

He also said both Venezuela and Brazil share the democratic values enshrined in hemispheric agreements.

In contrast, he said, ``Cuba remains a stark exception to those values.''

He said the United States can cooperate with Brazil and support a democratic path in Venezuela as it faces the challenge of overcoming deep political divisions.

Shortly after his election in October, Silva told an interviewer the Cuban revolution, now 44 years ago, held little appeal for Brazilians nowadays.

Michael Shifter, an analyst at the Inter-American Dialogue research group, said Silva's display of friendship toward Chavez and Castro was a means of making a gesture to his leftist supporters at home.

Having meetings with Chavez and Castro is a way to satisfy his base for now,'' Shifter said. I can't imagine him going in the direction that Chavez and Castro have gone.''

Shifter said Silva's statements and his appointments to key economic posts suggest that his economic policies may be similar to those of his predecessor, Fernando Henrique Cardoso.

One test of Brazil's relations with Venezuela could be Silva's response to Chavez's request for technical experts from Brazil's state-owned oil company to replace some of the 30,000 Venezuelan state oil workers who have joined a crippling nationwide strike.

President Bush dispatched U.S. Trade Representative Robert Zoellick as his personal representative at the inauguration.

The selection was seen by some Brazilians as a snub because Zoellick suggested last October that Brazil's only trading partner would be Antarctica if it did not join a proposed hemispheric free trade zone.

Silva responded by calling Zoellick ``the sub secretary of a sub secretary of a sub secretary'' during his election campaign. Zoellick is a member of Bush's Cabinet.

Zoellick is expected to have extensive dealings with Brazil as part of Bush's goal of a hemispheric free trade agreement by January 2005.

VOA News 03 Jan 2003, 22:23 UTC

The United States has dismissed a call for the creation of a new mediating group to help Venezuela resolve its ongoing political crisis.

State Department spokesman Richard Boucher told reporters in Washington Friday that current mediation efforts by the Organization of American States (OAS) should suffice.

Mr. Boucher also said the OAS is uniquely positioned and equipped to address what he called Venezuela's crisis of democracy.

On Thursday, Venezuelan President Hugo Chavez said he favored the creation of a "Friends of Venezuela" group to help end the crisis that has paralyzed the country's key oil sector.

President Chavez did not name the countries that would be involved in the proposed group, but said he expected them to represent Latin America, Europe and the Organization of Petroleum Exporting Countries (OPEC). Venezuela is a member of the OPEC cartel.

02.01.2003 10.46 am

BRASILIA, Brazil - Former metalworker Luiz Inacio Lula da Silva became Brazil's first working-class president on Wednesday, (Thursday NZT) as tens of thousands celebrated the historic changeover in Latin America's largest country.

At the sleek, modernist Congress in the capital, Brasilia, Lula took the oath of office as the first leftist elected to the presidency. Supporters from across the nation cheered outside as he promised to change the country's course to improve the lot of Brazil's working majority.

He cited his own struggle against poverty as proof that the continent-sized nation had the resources to overcome a long list of problems including escalating crime, a stagnating economy and rising unemployment.

"When I see my own life as an immigrant from the Northeast, a boy who sold peanuts and oranges at the port of Santos... who is now the president, I am convinced we can do much more, and to do so all we need is to believe in ourselves," Lula said. "We are starting a new chapter in Brazil's history."

Before reaching the convertible Rolls Royce that took him to receive the presidential sash from outgoing President Fernando Henrique Cardoso, Lula was mobbed by cheering fans.

It was the first time in 40 years an elected president passed the sash to another elected president.

Some broke through police guards simply to touch their new leader, while one stubborn supporter stopped Lula long enough to snap a picture alongside the gray bearded 57-year-old, who took the oath in a dark suit and striped tie.

With the humble classes that gave him a record-breaking 52 million votes in his fourth attempt at the presidency in mind, Lula organized a party for the people rather than for dignitaries.

Despite rain, festivities kicked off early with country music. More than 150,000 people were expected to converge on the city's central lawn for celebrations.

At the stark, white Planalto presidential palace, Cardoso capped off his second four-year term by handing Lula the sash decorated with the yellow and green of the Brazilian flag.

As Air Force planes swooped in formation over the city, revelers celebrated as they would for Brazil's world-famous soccer victories, driving along the sweeping avenues of the capital, honking horns, and dancing in a sea of green, yellow and deep red, the color of Lula's leftist Workers' Party.

In a country with one of the worst wealth distributions in the world, only surpassed by three African nations, the arrival of a man who never made it past elementary school to the highest office heralded a new beginning for the nation's 170 million people, 53 million of whom live in poverty.

Many of those present spent days on Brazil's bumpy highways, including Lula's 21 relatives from his poor hometown of Caetes, a caravan that drew cheers along the 2400km journey.

Although the New Year's holiday kept some heads of state from attending, most presidents from neighbouring countries were on hand, including Fidel Castro of Cuba and Hugo Chavez of Venezuela, two leftists who have supported Lula in his long quest for the presidency.

The world will watch Lula's management of a nation now seen as a model of democracy in a region troubled by political upheaval, particularly in neighboring Argentina and Venezuela.

• REUTERS

Wednesday January 1, 2003 2:50 PM

CARACAS, Venezuela (AP) - The embattled Venezuelan president - his rule under threat from turmoil in the strikebound oil-producing nation - left the country Wednesday to attend the inauguration of the new Brazilian president.

In what could be a daring move given the upheaval shaking Venezuela, President Hugo Chavez arrived in the Brasilia for the ceremony installing President Luiz Inacio Lula da Silva, whom he considers a friend and ally.

As Chavez arrived at his Brasilia hotel, he told reporters the strike will fail and he wasn't worried about being toppled from power while out of the country.

It's not a strike, it is a conspiracy,'' he said. Venezuelan workers are on the side of the government. ...The country hasn't stopped.''

As the old year turned to new Wednesday, thousands of protesters filled a downtown highway in Caracas to celebrate and demand that Chavez hold a referendum on his embattled presidency.

The demonstrators waved flags, shot off firecrackers and chanted, ``Not one step back,'' in a call to continue a month-long general strike aimed at ousting Chavez from power.

A few miles away, about 1,000 Chavez supporters held their own rally with a loud celebration party outside one of Venezuela's state-run oil company buildings.

The capital awoke to silence Wednesday morning and streets littered with exploded fire crackers and broken beer glass. People stayed home and shops were closed - either for the strike or for the holiday.

The dueling celebrations highlighted the divisions in this South American country, where even family holidays have turned political. New Year's is traditionally a family celebration in Venezuela, the world's fifth-largest oil exporter.

The oil industry, which produces one-third of the gross domestic product and 70 percent of export revenue, has been paralyzed by the strike, which began Dec. 2. Chavez responded by firing dozens of strikers at Petroleos de Venezuela S.A. and importing gasoline and food to counteract shortages.

At the opposition rally, the rhetoric toward Chavez was bitter.

``He is a bandit, an illiterate. He doesn't know how to speak well; he's primitive,'' said Carmen Carrillo, 63, as she watched what the opposition called a Party for Peace.

Strike leaders said Tuesday that if Chavez does not bow to demands for a Feb. 2 referendum on his presidency, they will lead another march on the heavily defended presidential palace.

I say let's go,'' said Carlos Ortega, head of Venezuela's largest labor confederation. And if they are going to kill us, let them kill us once and for all.''

Nineteen people were killed in the opposition's last march on the palace, which prompted a failed two-day coup last April.

Already, protests have erupted at empty service stations. Many Venezuelans predict full-scale riots if Chavez cannot begin delivering gasoline.

Many citizens also are embarrassed that a nation with the largest oil reserves outside the Middle East has been forced to import gasoline from other countries.

At the pro-Chavez rally, the president's supporters listened closely to Chavez' year-end message. The speech, broadcast nationally and presented on a giant screen at the rally, offered little hope for a quick end to the crisis. The president instead braced his country for a tough year to come.

``We must prepare to face difficulties in the first quarter of the year: economic difficulties and difficulties in continuing all the government's plans,'' he said.

``Let's prepare ourselves for the battle, but prepare ourselves with the conviction that 2003 will be a good year. A year of bounty, progress, prosperity, and the consolidation of peace, to leave behind the winds of war that still blow.''

The Chavistas, as the president's supporters are called, danced under Christmas lights as a 13-piece band played ``gaitas,'' traditional holiday music, while fireworks lit the sky.

Chavez is the president of the poor and we trust he'll make our lives better. That's why we're going to continue by his side in 2003,'' said 69-year-old Lourdes Cardenas. United, we'll overcome adversity.''