'Friends' to Send Team to Venezuela Next Week

abcnews.go.com — By Arshad Mohammed and Pascal Fletcher

WASHINGTON/CARACAS, Venezuela (Reuters) - The newly formed six-nation "Group of Friends" agreed on Friday to send a high-level team to Caracas next week to try to find a solution to the political crisis that has crippled Venezuela's economy.

Brazilian Foreign Minister Celso Amorim, speaking for the group that includes the United States, Brazil, Mexico, Chile, Spain and Portugal, urged Venezuela's opposition and government to curb violence in the world's fifth-largest oil exporter.

Opponents of Venezuelan President Hugo Chavez have staged a 54-day strike, slashing Venezuela's oil exports, in an effort to pressure the populist president to resign and hold early elections. Chavez has refused to step down.

"The mission is going to discuss concrete measures like, for example, how to diminish the risk of violence ... and the process of moderating the rhetoric," Amorim told reporters after the group's first meeting, held at the Organization of American States headquarters in Washington.

He said the team, likely to arrive on Thursday, will also explore options proposed by former U.S. President Jimmy Carter: one for an amendment to Venezuela's constitution to trigger early elections and the other for an Aug. 19 referendum.

The "Group of Friends" was formed last week to support OAS Secretary-General Cesar Gaviria's more than two-month effort to broker a deal between the two sides, which appear far apart.

The polarized positions and increasing outbreaks of violence have added urgency to international peace efforts.

'WORSE BY THE DAY' "Tragically ... the situation in Venezuela grows worse by the day," Secretary of State Colin Powell told the group according to a text of his prepared remarks.

Venezuelan opposition negotiators told reporters in Washington that any accord on elections must also include an agreement to restore to their jobs striking executives and employees of the state oil company PDVSA. Otherwise, they said, the grueling strike could not be lifted.

Chavez announced Thursday his government had sacked 3,000 PDVSA employees involved in the shutdown and said he was not prepared to negotiate with "terrorists."

"There can be no way out of this crisis based solely on elections. It has to include a solution to the oil issue," Timoteo Zambrano, a leader of the Coordinadora Democratica opposition coalition, told a news conference in Washington.

The opposition negotiators had earlier met with foreign ministers of the "friends" group.

The opposition shutdown has throttled oil output by South America's largest oil producer, pushing up world prices. It has also triggered a fiscal crisis for the Venezuelan government, forcing it to suspend foreign exchange trading and cut back budget spending by 10 percent.

But, in a sign that Chavez is making some headway in his efforts to break the strike, oil production and exports have been rising again.

Still, oil exports, the country's economic lifeblood, were only a quarter of normal levels and striking state oil executives voted Friday to maintain the stoppage.

Venezuelan oil supplies to the United States, normally more than 13 percent of total U.S. oil imports, have been disrupted by the strike, just when the United States is preparing for a possible war on Iraq.

Opposition negotiators said they hoped the "Group of Friends" could pressure Chavez to accept a negotiated electoral solution to end the crisis, which has raised fears of a violent, uncontrollable internal conflict in Venezuela.

Chavez, a former paratrooper who survived a brief coup last year, is resisting calls for early elections and has vowed to beat the strike. He accuses his opponents of trying to topple him from power by wrecking the economy.

His opponents say the president, who Thursday threatened to close hostile private television channels and take over banks which joined the strike, is ruling like a dictator. They accuse him of trying to install Cuba-style communism in Venezuela.

Chavez has already said he is willing to abide by the result of a binding referendum on his rule which the constitution foresees after Aug. 19, half way through his current term due to end in early 2007.