www.whnt19.com

Caracas, Venezuela-AP -- Venezuelan President Hugo Chavez (OO'-goh CHAH'-vez) is promising price controls and other measures.

He's trying to hold off an economic tailspin caused by an opposition strike now in its ninth week.

He's already imposed limits on trade in foreign currencies.

Hundreds of thousands of his foes occupied a central Caracas highway for the entire weekend to protest a Supreme Court decision suspending a referendum next month on Chavez's rule.

Opposition leaders say instead of the referendum, they will collect signatures next month petitioning for Chavez to quit.

The strike called by a coalition of business, labor and political groups has crippled oil production in the world's fifth-largest petroleum exporter.

Although the referendum wouldn't have been binding, opponents had hoped a negative outcome would have embarrassed Chavez into quitting.

www.forbes.com Reuters, 01.27.03, 7:20 AM ET (Fixes typographical error in author credit line at end of story)

PORTO ALEGRE, Brazil, Jan 26 (Reuters) - Venezuelan President Hugo Chavez on Sunday said his government would present a bill in two weeks to tax financial market transactions, raising more uncertainties for investors as the country suffers under an 8-week-long strike.

Only last Wednesday, Venezuela, the world's fifth-biggest oil exporter, closed its currency market for five trading days after vital oil output was hit by the work stoppages that aim to force Chavez to resign and make way for elections.

"We are in favor of this proposal and it is very probable that a law in Venezuela establishes a tax on financial transactions in the short term," Chavez told reporters. "The government will present parliament with a law (bill) to discuss in two weeks time."

Later, he suggested other measures might follow.

"We have decided to put in place currency controls to protect the international reserves... so as not to threaten the population, there must also be price controls," Chavez said.

Hundreds of rowdy flag-waving supporters cheered Chavez's at a demonstration of support at the six-day World Social Forum being held in Brazil's southern city of Porto Alegre. The WSF is a meeting of leftist intellectuals and social groups designed to counter the conference of national and business leaders at the World Economic Forum in Switzerland.

The bill to tax financial transactions was apparently inspired by the so-called Tobin Tax on foreign exchange transactions, named after Nobel Prize-winning U.S. economist James Tobin who first floated the idea in the 1970s.

"We are currently protecting our international reserves from speculative attacks," Chavez told reporters earlier. "We are studying a tax like the Tobin one for financial transactions."

The Tobin Tax has been championed by some social groups as a way of reducing damaging currency speculation and raising funds for developing countries, but it has been largely rejected by finance ministers and central bankers in Europe.

santafenewmexican.com By ALAN CLENDENNING | Associated Press 01/27/2003

From left, French activist Jose Bove and Bernard Cassen meet Venezuelan president Hugo Chavez for a private meeting on Sunday, Jan. 26, 2003. - AP | Giuseppe Bizzarri

PORTO ALEGRE, Brazil—Venezuelan President Hugo Chavez, facing protests at home, got an enthusiastic welcome after arriving at the World Social Forum to meet with sympathizers among 100,000 activists venting against American-style capitalism.

Chavez met with forum organizers and addressed activists Sunday in this far southern Brazilian port city, harshly criticizing opponents in Venezuela staging a 56-day strike.

He said they would fail to oust him from power, and praised activists for their opposition to neoliberalism - their term for a mix of unfettered free-market economics, liberal trade and the breakdown of national borders

"You here at the forum and we in Venezuela are trying to come up with an alternative to neoliberalism that is destroying the world," Chavez said in a two-hour speech attended by more than 2,000 cheering activists. "If we don't put an end to neoliberalism, neoliberalism will put an end to us."

Before he spoke at Port Alegre's state legislature, hundreds showed up outside and handed out free copies of a book in English and Spanish entitled, "The Fascist Coup Against Venezuela," a compilation of Chavez speeches over the last two months.

Dressed in her white habit and waving a small Venezuelan flag, Franciscan nun Maria Vandege Santa said Chavez is fighting injustice and poverty in Venezuela.

"I am here to protest the efforts to topple a president who only wants to help the poor," said Santa, who lives in Brazil's poverty-stricken northeast.

Chavez said would soon propose a tax on all financial transactions in Venezuela, saying it would be "a kind of Tobin tax." Tobin taxes, named after Yale University economist and Nobel-laureate James Tobin, are designed to tame currency market volatility.

Chavez did not provide more details on the new tax, nor when he would seek to have it put into place. He also said Venezuela's dollar-based reserves dropped a total of US$3 billion in December and January.

Opponents gathering signatures to demand a constitutional amendment that could lead to early elections are welcome to do so, Chavez said, but claimed an earlier effort was tainted by fraud.

Any new effort "has to be a valid collection of signatures," Chavez said.

Although Chavez wasn't formally invited to the World Social Forum, a counter-conference to the World Economic Forum being held in Davos, Switzerland, he was attending some events.

Activists at the six-day social forum are participating in 1,700 sessions and workshops on topics ranging from corporate misdeeds to Third World debt.

Chavez fits right in, many say, because he advocates political, social and economic revolution to solve South America's ills.

He came to the forum because he "wants to further address in Porto Alegre the same issues of poverty, misery and corruption that he is trying to address in Venezuela," said Jo Moraes, vice president of the Communist Party of Brazil.

The strike in Venezuela has paralyzed the country, crimped oil production for the world's fifth-largest oil exporter and caused severe food and fuel shortages. Chavez told reporters, however, that oil production that was once as low as 200,000 barrels per day is rising and is now at 1.32 million barrels a day.

On Sunday, at least 100,000 Venezuelans were parked on a Caracas highway in what they said would be their longest protest yet against Chavez.

But Chilean Senator Gladys Marin, a Communist, said Chavez is helping to fight what could become fascism in South America.

"If this coup wins, you will suffer a long dictatorship and it will be cruel," she told 1,000 activists gathered at a forum workshop.

Also Sunday, an unidentified woman threw a strawberry cake into the face of Jose Genoino, the head of President Luiz Inacio Lula da Silva's Workers Party, yelling "Lula does not represent us in Davos."

Some activists criticized Silva, who is popularly known as Lula, for going to the economic forum in Switzerland after attending the social forum.

The woman left a statement saying she belonged to a group called "Bakers Without Borders." Genoino called the incident an "act of anarchists," according to Brazil's GloboNews television network. The woman fled, and no efforts were made to detain or arrest her.

santafenewmexican.com

By JOSEPH B. FRAZIER | Associated Press 01/27/2003

Venezuelan President Hugo Chavez gestures during a press conference in Porto Alegre, Brazil on Sunday Jan. 26, 2003. - AP |

CARACAS, Venezuela—President Hugo Chavez said he would put in place price and currency controls as Venezuela's economy heads for a tailspin stemming from an opposition strike, which was entering its ninth week Monday.

"So that these (currency) controls do not hurt the poor, we will institute price controls," Chavez said Sunday in Porto Alegre, Brazil, at the World Social Forum. He did not give details of the controls.

Hundreds of thousands of his foes occupied a central Caracas highway for the entire weekend to protest a Supreme Court decision suspending a Feb. 2 referendum on Chavez's rule.

After extending the protest well beyond the 24 hours planned, protesters finally rolled up their national flags - and, in many cases, their tents - and let traffic flow again.

Opposition leaders said instead of the referendum they would collect signatures Feb. 2 petitioning for Chavez to quit, for his term to be cut and for pro-Chavez lawmakers to be replaced.

A coalition of business, labor and political groups called the strike Dec. 2 to pressure Chavez into accepting the referendum.

Although the referendum wouldn't have been binding, opponents had hoped a negative outcome would have embarrassed Chavez into quitting.

Cutting his term through a constitutional amendment would pave the way for early elections. The amendment would involve cutting Chavez's six-year term, currently due to run until 2007, to four.

Amending the constitution requires a popular referendum. Citizens can demand such a vote by collecting signatures from 15 percent of Venezuela's 12 million registered voters.

Chavez suspended foreign currency dealings for five business days last Wednesday to halt the rush of nervous Venezuelans trading in their bolivars for dollars. The currency has lost 25 percent of its value this year alone.

On Sunday, he said he will soon propose a tax on all financial transactions in Venezuela, saying it would be "a kind of Tobin tax." Tobin taxes, named after Yale University economist and Nobel-laureate James Tobin, are designed to tame currency market volatility.

Chavez did not provide more details, but said Venezuela's dollar-based reserves dropped US$3 billion in December and January as a national strike dried up oil exports.

Dollars are needed to buy food - about half of which is imported - medicines and other essentials, some of which already are in short supply.

Venezuela must import gasoline, which is so hard to find that lines at the few open stations sometimes stretch for a mile (1.6 kilometers) or more.

Oil provides 80 percent of the government's foreign exchange and makes up a third of gross domestic product. Before the strike, Venezuela was the world's fifth-largest supplier.

Chavez said Sunday that oil production has risen to 1.32 million barrels a day. But dissident oil executives put the figure at about 957,000 barrels. Pre-strike production was about 3.2 million barrels, and fell as low as 150,000 barrels early in the strike.

Many small businesses that joined the strike at its outset Dec. 2 have since returned to work but thousands of others have refused to open up, despite the damage being wreaked on the economy.

Exchange controls will help protect the bolivar and the government's depleting foreign reserves. But they will hurt many businesses as dollars are needed to buy food, about half of which is imported, medicines and other essentials, some of which already are scarce.

The Santander Central Hispano investment bank has warned that Venezuela's economy could contract as much as 40 percent in the first quarter of 2003. It shrank by an estimated 8 percent in 2002. Unemployment is 17 percent and inflation, fueled by a 46 percent devaluation of the bolivar last year, is 30 percent.

www.tribnet.com

The Associated Press

Gas prices rose nearly one and a half cents per gallon over the past two weeks, an industry analyst said Sunday.

The average weighted price for gas nationwide, including all grades and taxes, was about $1.52 per gallon Friday, according to the Lundberg Survey of 8,000 stations nationwide. Gas cost just over $1.50 a gallon on Jan. 3, the date of the last Lundberg Survey.

Contributing to the price rise was the continuing oil production strike in Venezuela, a fear of war against Iraq, the intense cold weather on America's East Coast, which is prompting some refiners to produce more heating oil, and the addition of a costlier gasoline additive in California, Trilby Lundberg said. (Published 12:30AM, January 27th, 2003)