Monday, December 30, 2002 00:21 AM ET     CARACAS, Venezuela -- A 29-day conflict between striking employees of the state oil company and President Hugo Chavez's government has turned into a war of attrition, Monday's Wall Street Journal reported.

In a media blitz over the weekend, the government claimed it was winning the war against the strikers. But dissident employees at Petroleos de Venezuela SA, or PdVSA, accuse Mr. Chavez and his ministers of pursuing a "big lie" propaganda strategy.

The world's fifth-largest oil exporter has been forced to import gasoline to keep a limited number of cars and trucks on the road. A tanker ship arrived Saturday from Brazil with 22 million gallons of gasoline; another is en route from Trinidad carrying 16.8 million gallons.

The battle for PdVSA already has cost the government at least $1.5 billion and threatens to dry up the 50% of state revenues that come from international oil sales. Moreover, buying gasoline on the spot market at around $60 a barrel and selling it on the domestic market at a subsidized $11 barrel is an expensive contingency, said PdVSA President Ali Rodriguez. Nevertheless, he said, "We'll buy from foreign sources whenever we need to. It's a precaution."

Wall Street Journal Staff Reporter Marc Lifsher contributed to this report.

December 30 2002

Hundreds of thousands of protesters took to the streets of Caracas today as embattled President Hugo Chavez engaged in a bitter war of words with leaders of a 28-day-old national strike.

To cheers from flag-waving, whistle-blowing demonstrators, strike leader Carlos Ortega claimed the former paratrooper was acting in a criminal manner by refusing to give in to a mounting clamour for his resignation.

"Mr Chavez, you are not a democrat, you are a failed soldier," the unionist told the crowd who thronged an avenue in southern Caracas.

"You have declared war on Venezuelans, you are preparing for confrontation," said Ortega, adding "they would have to kill us to end this strike."

He was followed on the podium by a young child yelling out anti-Chavez slogans.    As Ortega spoke, Chavez thundered against his foes and proclaimed victory in the battle to regain the vital oil sector that had been made idle by the strike.

"We have defeated the anti-Venezuela conspiracy," he told a supporters during the live broadcast of his weekly Hello President show at a petrol distribution centre 100km west of the capital.

A former colonel who won at the ballot box in 1998 the power he failed to grab in a military coup six years earlier, Chavez spoke in military terms of the crisis rocking the South American county.

"It is like a war for Venezuela, a war between patriots and ... traitors," Chavez said.

As he spoke, several petrol tankers headed out of the installations, raising a thunder of applause from the crowd.

As his supporters roared "firm hand, firm hand" the president said he would not use force against those he said were plotting against him, and would let justice take its course.

Private television stations, which actively support the opposition, showed live coverage of the demonstration, as protesters marched from several points of the capital to converge on an avenue in south Caracas, and later attended a rock event dubbed "concert for freedom".

State-run TV, for its part, aired the president's program, which went on for three and a half hours.

The president, whose term ends in 2006, rejected demands that he resign or call snap elections: "Hugo Chavez leave Venezuelans in the hands of those fascists? No, never."

He also insisted petrol supplies were getting back to normal.

But the long lines at service stations and plunging oil output and export figures provided by his own government belied that claim.

Even outside service stations that ran out of fuel, motorists lined up, some for days, hoping supplies would eventually arrive.

Ali Rodriguez, who heads the Petroleos de Venezuela state oil company, conceded he too was affected by the shortages. "I have had problems to fill up my car with gasoline (petrol)," he told journalists.

By strangling the oil industry, government opponents have hit at the lifeline of the South American country.

Chavez proudly announced that Venezuela had exported seven million barrels of oil in the first 24 days of the month, an amount it usually ships out in three days.

Authorities have also said production was down to less than 700,000 barrels a day, a figure which strikers say is exaggerated and which amounts to less than one fourth of November's daily output.

Government officials insist internal distribution should soon get back to normal, thanks notably to the arrival yesterday of a Brazilian tanker and the expected shipment from Trinidad of a further 400,000 barrels of petrol.

AFP

ONSA/Circ. No. 0011 - 28 2000Q DIC2002 CARACAS - VE www.onsa.org

La Organización Nacional de Salvamento y Seguridad Marítima de los espacios Acuáticos de Venezuela - ONSA A.C. - ALARMADA por la actual situación de alto riesgo, en materia de Seguridad Marítima, Medio Ambiente y de seguridad de la vida en la mar que se ha presentando en nuestros espacios acuáticos, hace del conocimiento público que:

HABIENDO TOMADO NOTA, de hechos públicos, notorios y comunicacionales derivados de los medios de prensa y otras fuentes, en cuanto a:

(i) Las declaraciones y oposición de los tripulantes de los buques, en donde se asegura que las condiciones en que se están operando los mismos, son inseguras, debido a deficiencias en de personal tanto a bordo como en el terminal portuario, así como a su falta de experiencia;

(ii) a La navegación de buques como el CASO B/T MORUY el cual fue tomado por la ARMADA el lunes en la noche, movilizándolo con destino a CURAÇAO en condición ilegal conforme a las declaraciones del Capitán César Vicente; sin además el total de la tripulación ni el cumplimiento de los requisitos por parte de dicho personal para la realización de las maniobras;

(iii) a La pérdida de las pólizas de seguro de los Buques tales como el Bárbara Palacios y el Yavire, en consideración a la inseguridad de los buques, declarada por ciertos agentes de seguro, al igual que al B/T Pilín León, por haber sido movilizado sin que su tripulación estuviese certificada.

(iv) a La declaración de las aseguradoras de armadores, acerca de que los terminales son inseguros debido a que los remolcadores no están certificados, así como que las operaciones de carga y descarga estarían siendo realizadas por personal no calificado;

(v) a Los incidentes ocurridos tales como: atraques de buques en terminales o muelles no correspondientes, impacto con otros buques (remolcadores) al momento de las maniobras, varamiento de buques en el Río Orinoco tales como el Single Garcht quien tocó fondo en la milla número 15;

(vi) a La renuncia de funcionarios representantes de la Autoridad Acuática, tales como Capitanes de Puerto y hasta el propio Presidente del Instituto Nacional de los Espacios Acuáticos, en virtud de su inconformidad o invitaciones a que se violara la reglamentación pertinente;

y TOMANDO EN CONSIDERACIÓN lo anteriormente expuesto, así como la normativa Nacional enmarcada dentro de las leyes de la República y de la Internacional amparada en los Convenios Internacionales, especialmente: del de Seguridad de la Vida en la Mar [SOLAS 74/2000]; del de Estándares de Capacitación, Certificación y Guardias de la Gente de Mar [STCW 78/95] y del de la Prevención de la Polución de Buques [MARPOL 73/78]; etc.

CONSIDERAMOS RESPECTIVAMENTE, inseguros a los puertos venezolanos que no cumplan con todos los requisitos de seguridad contenidos en el marco jurídico que los asiste o que tenga deficiencias del personal que allí labora; así también a los buques venezolanos que no cumplan con los establecido en las leyes de la República y los Convenios Internacionales respectivos;

ALERTAMOS a toda la comunidad náutica nacional e internacional, acerca de la grave situación aquí presentada, a los fines de que tomen la medidas a que halla lugar, en defensa y protección de sus intereses, así como responsables de la supervisión, vigilancia y control de sus espacios acuáticos;

DEPLORAMOS el maltrato y las presiones tanto físicas como psicológicas, que se estuvieren cometiendo en contra de las tripulaciones de los buques, con el solo objeto de obligarles a realizar alguna actividad que contraríe la legislación y procedimientos que pongan en riesgo la Seguridad Marítima, el Medio Ambiente o la Seguridad de la vida en la mar;

EXORTAMOS a toda la Gente de Mar a contactar a esta Organización - ONSA A.C. - a través de su portal informativo [ www.onsa.org.ve ] o vía fax (212) 2861036, a los fines de recopilar toda la documentación o información relacionada con las violaciones a la Seguridad Marítima, al Medio Ambiente Acuático y en general a la Seguridad de la vida en la Mar, a los fines pertinentes.

ONSA A.C.

ALAN CLENDENNING Associated Press

SAO PAULO, Brazil - Brazilians like to say dreams are free, but when Luiz Inacio Lula da Silva becomes Brazil's president Wednesday, he'll learn the costs of turning hope into reality.

From Rio de Janeiro's hillside shantytowns to the skyscrapers of Sao Paulo, the country's financial capital, many Brazilians are convinced Silva's presidency spells a change for the better.

Voted in by a diverse coalition ranging from landless peasants to evangelical industrialists, the only certainty is that Silva will have to perform a delicate balancing act.

As a former radical union leader and Brazil's first leftist president in 40 years, Silva assumes the presidency of Latin America's largest country Jan. 1 amid widespread expectations that he cares deeply about improving the lot of the country's 50 million poor.

But to get elected, after three unsuccessful attempts, Silva was forced to reach out to former foes in the business and international investment community.

So his pledges to create millions of jobs and eliminate hunger are carefully coupled with promises of fiscal austerity and commitments to honor the country's foreign debt.

"He must please investors and financial markets to attract investments and avoid a liquidity or debt crisis, but at the same time Lula needs to maintain the social and political support he acquired in the electoral ballots," said Ricardo Amorim, head of Latin American research at IDEAglobal, a New York-based investment consulting firm.

It doesn't help that Silva takes office just as Brazil finds itself mired in recession with inflation, an almost-forgotten villain, creeping back up into the double digits.

No one questions Silva will have to quickly enact meaningful social reforms in a country where the division of wealth is among the world's most profound. Ninety percent of Brazil's land is held by 20 percent of the country's 175 million people, and the poorest 40 percent own just 1 percent.

The larger question is how to do that without defaulting on Brazil's mammoth $230 billion debt.

Investors alarmed at the prospect of Silva's left-leaning Workers' Party taking power sent the value Brazil's currency, the real, plunging 40 percent over the summer to nearly 4 to the dollar.

But the real rose in recent weeks to 3.5 to the dollar after Silva named fiscal moderates to key economic cabinet posts and a former global banking head at FleetBoston Financial Corp., Henrique Meirelles, to run the central bank.

"What you've got is a handful of executives versus millions living in shacks," said Stephen Haber, a political science professor and Latin American expert at Stanford University. "The people who voted for Lula expect him to do something about it."

Few experts believe Silva will steer Brazil toward the socialism he used to espouse.

"There's a clamor for change in Brazil, but people don't want socialist production, they want a job," Haber said.

That's certainly the case with Alex Alberto Pereira, a 28-year-old who shines shoes on the street of Sao Paulo in the shadow of skyscrapers where helicopter taxis land as they ferry executives to work.

Pereira says jobs are Brazil's biggest issue, because the more people work, the more shoes there are to shine.

"I think that the people now have a chance because Lula comes from the people," said Pereira, who struggles to support his wife, son and two relatives on less than $120 a month.

Silva can certainly relate.

The son of a poor farmer, he dropped out of school after fifth grade to work as a streetside peanut vendor and later shining shoes.

At age 14, he began working in a factory, where he lost his left little finger in a machine press. Silva became a radical union activist and was jailed as a subversive after leading strikes during Brazil's military dictatorship.

Silva may have traded in his red T-shirts and Mao caps for Italian suits, and his trademark brown beard has turned gray. But so far, he still has strong support from his core constituency.

A recent survey by the Brazil-based Ibope polling group found that 63 percent of Brazil's voters think life will be better under Silva's administration. Two thousand were questioned, and the poll had a margin of error of 2.2 percent.

In Rio de Janeiro's Rocinha slum, where 160,000 people live in ramshackle homes stacked on top of each other, many expect Silva will find a way to help the poor.

"It's about time," said Didi Trindade, a 51-year-old homemaker. "He's a serious, honest person, with the will to do whatever he can."

Silva has warned Brazilians not to expect big changes for now. After winning October's election, he said the country's troubles "cannot be solved with a stroke of magic."

He's already had to scale back promises on raising the monthly minimum wage and lowering interest rates.

Brazil's economic situation prevents Silva from enacting costly reforms that could scare investors, said Herbert Klein, a Latin American history professor at Columbia University.

"I think he has to be constrained," Klein said. "If it were boom economic times, if debt was being paid nicely, you would have had a general discussion of radical talk about serious redistribution."

Skeptics say Silva may seem different, but don't believe anyone can ease the country's misery.

As he drank a beer in a Rio bar, pharmacy owner Carlos Roberto Soares said the rich have always controlled Brazil and will find ways to protect their interests and assets.

"The whole system is corrupt," said Soares, 40. "Lula will be some kind of puppet in the hands of these people."

VOA News 29 Dec 2002, 16:39 UTC

Brazil's incoming defense minister, Jose Viegas, said president-elect Luiz Anacio Lula da Silva plans to use the military to assist in various social development projects. Mr. Viegas said Mr. da Silva wants the armed forces to be a vehicle of social development in Brazil.

Mr. Viegas said the army, navy and air force can contribute in carrying out social projects, such as combating hunger, at a lower cost.

However, he said the use of the military for social programs would not detract from its main mission to defend the country, even though the defense budget is shrinking.