Venezuela's opposition accuses President Chavez of intimidating bankers

www.canada.com Canadian Press Thursday, January 30, 2003

CARACAS (AP) - Venezuelan opposition leaders accused President Hugo Chavez of threatening the country's bankers to make them abandon a general strike aimed at toppling him.

The National Banking Council said Wednesday that its members will return to normal operating hours on Monday. For two months, thousands of people have waited in long lines while banks opened just three hours a day. Other sectors, including workers in the state oil company, will remain on strike.

"This is a government that, one way or another, acts with pressure and repression. This influenced the decision," said strike leader Carlos Fernandez.

Chavez had threatened to fine banks and withdraw the armed forces' deposits from private institutions if they did not resume normal operations. Bankers said they provide a public service, which influenced the decision.

"We owe the public," Nelson Mezerhane, the council's vice-president, said after a council meeting Wednesday. "They have their earnings and money in our institutions."

Fearing that effects of the work stoppage - shortages of food, medicine, fuel and cash - could hurt their cause, many businesses plan to reopen next week. Many also worry about bankruptcy.

Deepening recession, the strike and lack of oil income will close 25,000 small and medium-size manufacturing and service businesses - at least eight per cent of total small and medium firms, the Fedeindustria business chamber has predicted. Closures in the first half of 2003 will leave 200,000 people jobless, it said earlier this month.

Oil output surpassed one million barrels a day this week, a third of pre-strike levels. Oil provides half of government income and 70 per cent of export revenue.

Dissident executives at state-run oil monopoly Petroleos de Venezuela S.A., or PDVSA, said the strike will continue in the oil industry despite the government's success in raising production.

The strike has cost Venezuela $4 billion US so far. It has forced the government to suspend foreign exchange trading until at least Feb. 5 to protect its currency, the bolivar, which has lost 25 per cent of its value this year. At the end of the freeze, the government plans to limit the amount of foreign currency Venezuelans can buy.

The government may set the bolivar at 1,600 to the U.S. dollar and then devalue it every month, Ricardo Sanguino, a member of the congressional finance commission and Chavez's Fifth Republic Movement party, told Globovision television Thursday. The bolivar closed at 1,853 before the dollar sales freeze began last week.

Arguing that oil executives sabotaged oil installations to ensure the strike's success, Chavez has fired one-eighth of the company's work force to regain control of the industry.

"These traitors should be in prison," Chavez said on Wednesday. "I call on judges to listen to the clamour of the people and jail these traitors."

Oil company strikers have rejected the accusation and challenged the government to present proof of sabotage.

While businesses pinched by the strike began to stray, government adversaries decided the best strategy to oust Chavez is by amending the constitution to shorten the presidential term and open the way for early elections.

The idea, which was floated by former U.S. president Jimmy Carter, "is the priority, it's the proposal we prefer," said Pedro Nikken, a lawyer and adviser to the Democratic Co-ordinator opposition movement.

Venezuela's diverse opposition had been considering a host of proposals, ranging from a referendum in August on the president's rule to amending the constitution to shorten the president's term from six years to four.

Chavez was elected in 1998 and re-elected two years later. His term ends in 2007.

The amendment proposal will be formally presented to "The Group of Friends of Venezuela," a forum of six countries helping broker an end to Venezuela's political conflict.

Diplomats from the United States, Brazil, Mexico, Chile, Spain and Portugal were to arrive in Venezuela on Thursday to support negotiations led by the Organization of American States.