www.news-journal.com By GEORGE GEDDA Associated Press Writer

WASHINGTON (AP)--Leaders from the United States and five other Democratic countries will meet here Friday in hopes of finding ways to help Venezuela overcome a political impasse between the government and the opposition.

The meeting will be hosted by the Organization of American States, which until now has taken the lead in resolving the stalemate. OAS Secretary General Cesar Gaviria has spent much of the past two months in Venezuela, but he has been unable to bridge differences between the parties over the timing of a new election.

Former President Carter, in Venezuela Tuesday on his second mediation visit, proposed an election plan that both sides are studying.

U.S. officials have strongly supported Gaviria's efforts and see the Friday meeting as a supplement to his activities.

Joining the United States at the meeting will be Mexico, Brazil, Chile, Spain and Portugal--members of a newly formed ``Friends of Venezuela.''

The meeting will be at the foreign ministers level but it is not clear whether Secretary of State Colin Powell will attend. He will depart Friday afternoon for a meeting in Switzerland.

Chile's foreign minister, Soledad Alvear, will not attend for personal reasons.

The United States has been concerned about the possible effect on world oil supplies of sharp cutbacks in Venezuela's oil production, resulting from a politically motivated strike by oil workers.

Last Friday, Venezuela's embattled president, Hugo Chavez, said he welcomed the creation of the ``friends'' group but recommended that it be expanded to include Russia, France, Algeria and China.

Diplomats say the current makeup of the friends group achieves a needed balance. Brazil under new President Luiz Inacio Lula da Silva is seen as perhaps the most sympathetic to Chavez. The Bush administration, meanwhile, has never been a strong backer of Chavez, who has a warm relationship with President Fidel Castro.

Strike leaders want Chavez to agree to a plebiscite in February on his presidency. Although the vote would be nonbinding, these leaders believe Chavez would be pressured by the outcome to step down.

The opposition believes Chavez has ruined the country's economy and tried to gather too much power in his own hands.

Chavez said any plebiscite held before August would be unconstitutional. Venezuela's constitution allows for a binding recall referendum halfway through the presidential term, which would be August.

www.forbes.com Reuters, 01.21.03, 5:27 PM ET (The following statement was released by the rating agency)

NEW YORK, Jan 21 - Moody's Investors Service downgraded the bank financial strength ratings (BFSR) of Banco Mercantil S.A., BBVA Banco Provincial S.A., and Banco de Venezuela Grupo Santander S.A. to E+ from D-, and changed the outlook for foreign currency deposit ratings and BFSRs of all five banks that it rates in Venezuela to developing from stable.

These outlook changes are a direct result of the change in outlook of Venezuela's ceiling for foreign currency bank deposits to developing from stable. In addition, Moody's also downgraded Venezuela's country ceiling for foreign currency bonds and notes to Caa1 from B3 due to the continuing suspension of the country's oil operations and the uncertainty about when production will resume.

This downgrade did not affect the rated banks, which do not have rated foreign currency bonds or notes. Moody's downgrade of the bank financial strength ratings of Banco Mercantil, BBVA Banco Provincial, and Banco de Venezuela Grupo Santander, the three strongest banks in the Venezuelan system, to E+ from D-, reflects the continued erosion of the operating environment.

Moody's also expects that corporate defaults will likely increase as a result of the ongoing economic disruption, negatively affecting the banks' asset quality. The other two rated banks, Banco del Caribe and Banco Banesco, are already rated E+. On February 27, 2002, the ratings agency had put the system's BFSRs on negative outlook, stating that "the Venezuelan banking system should be viewed with a certain amount of caution in light of the deteriorating political and economic environment in which it operates." This outlook culminated in a downgrade of the system on September 26, 2002, when Moody's reiterated that the banks were becoming increasingly vulnerable to political risk.

The following ratings were affected:

Banco Mercantil S.A: bank financial strength rating to E+ from D- BBVA Banco Provincial S.A: bank financial strength rating to E+ from D- Banco de Venezuela Grupo Santander S.A: bank financial strength rating to E+ from D-

www.ctv.ca Associated Press

CARACAS — Former U.S. president Jimmy Carter said Tuesday he drafted two proposals for leading Venezuela toward elections and ending a deadly 51-day-old strike intended to force President Hugo Chavez from office.

Carter made his proposals after attending negotiations between the government and opposition and meeting separately with Chavez and strike leaders. His Atlanta-based Carter Center, the Organization of American States and the United Nations are sponsoring the talks.

One proposal would amend Venezuela's constitution to allow for early general elections and to cut terms in office, Carter said. The amendment would have to be approved by Congress and voters.

Venezuela's opposition would call off the strike and, in return, the government - which has a majority in Congress - would agree to move quickly to adopt the amendment and organize early elections, Carter said.

Carter's second proposal calls for both sides to wait for a recall referendum on Chavez's rule, which the constitution says can happen halfway into the president's six-year term. In Chavez's case, that is August.

Carter, a Nobel Peace Prize winner, said before leaving Venezuela that the government and opposition would receive his proposals later Tuesday.

"We've been pleased with the reception we've had from both the government and the opposition," Carter said. "My opinion is that both sides want to end an impasse that is destroying the economy."

Business leaders, labour unions and opposition parties launched the strike Dec. 2 to demand that Chavez resign or call early elections.

Chavez said Tuesday he told Carter he would abide by any constitutional changes.

"If the people were to decide it should be four years ... I have no problem with that," Chavez said.

Strike leader Carlos Ortega, president of the one million-member Confederation of Venezuelan Workers, said earlier that Chavez never would accept a vote on his rule.

The strike has crippled Venezuela's oil industry, which was the world's fifth-largest exporter and a major supplier to the United States.

The strike has slashed production by more than two-thirds and caused domestic shortages of gasoline, food and drinking water. It has cost Venezuela $4 billion US, according to the government, and contributed to the plummeting of the bolivar currency.

The Organization of Petroleum Exporting Countries said it will be difficult to make up for shortages of Venezuelan oil in the United States because many U.S. refineries are geared to process heavier Venezuelan crude.

After an early surge Tuesday, European Brent crude fell to $30 US a barrel after Venezuelan tanker pilots announced they would resume work, which could convince foreign tanker companies to dock at Venezuelan ports. Foreign companies refused to do so during the strike for security and insurance reasons.

At least six people have died in political violence since the strike began, including a man killed Monday in clashes between Chavez supporters and opposition marchers. The violence in Charallave, about 30 kilometres south of Caracas, also injured dozens.

Six countries - Brazil, Chile, Mexico, Portugal, Spain and the United States - have begun an initiative called "Friends of Venezuela" to help end the crisis. Diplomats from the six countries will meet at OAS headquarters in Washington on Friday.

The National Elections Council, accepting an opposition petition, agreed to organize a Feb. 2 nonbinding referendum asking citizens whether Chavez should step down.

Chavez says the vote would be unconstitutional and his supporters have challenged it in the Supreme Court. But the president has welcomed a possible binding referendum halfway through his term.

Chavez, 48, was elected in 1998 and re-elected in 2000 on promises to redistribute the country's vast oil wealth among the poor majority.

His opponents accusing him of steering the economy into recession with leftist policies and running roughshod over democratic institutions.

www.dailyworld.com Posted on January 21, 2003 From The Associated Press

Petroleum prices rose today as a strike that has disabled the world's fifth-largest oil exporter entered its 51st day and international mediators struggled to resolve the stoppage aimed at forcing President Hugo Chavez from office.

European Brent crude soared to new two-year highs at more than $31 a barrel because of the Venezuelan crisis, possible war in Iraq and cold weather in the United States.

The Organization of Petroleum Exporting Countries said it will be difficult to make up for shortages of Venezuelan oil in the United States because many U.S. refineries are geared to process heavier Venezuelan crude.

The strike has slashed Venezuela's oil production by more than two-thirds and caused domestic shortages of gasoline, food and drinking water.

It has cost Venezuela $4 billion, according to the government, and contributed to the plummeting of the bolivar currency.

Former President Jimmy Carter was in Caracas trying to help resolve the situation. He was meeting with Chavez at the presidential palace early Tuesday.

Carter, who won the Nobel Peace Prize in October, attended negotiations between the government and opposition Monday and met separately with the president, strike leaders and Organization of American States secretary general Cesar Gaviria.

Carter's Atlanta-based Carter Center, the OAS and the United Nations are sponsoring the talks.

Business leaders, labor unions and opposition parties launched the strike Dec. 2 to demand that Chavez resign or call early elections.

Chavez threatened Sunday to walk out of talks, accusing the opposition of trying to topple him even as they negotiated.

Strike leader Carlos Ortega said Chavez would never accept a vote on his rule.

Ortega, president of the 1 million member Confederation of Venezuelan Workers, said Gaviria and Carter should "convince themselves once and for all that we are dealing with a regime that is not democratic, and that as long as Chavez stays in power there is no possibility of holding elections."

One man was killed and 27 were injured Monday when gunfire erupted as Chavez supporters confronted opposition marchers in Charallave, a town about 20 miles south of Caracas. At least six people have died in political violence since the strike began.

Six countries - Brazil, Chile, Mexico, Portugal, Spain and the United States - have begun an initiative called "Friends of Venezuela" to help end the crisis. Diplomats from the six nations will meet at OAS headquarters in Washington on Friday.

The National Elections Council, accepting an opposition petition, agreed to organize a Feb. 2 nonbinding referendum asking citizens whether Chavez should step down.

Chavez says the vote would be unconstitutional and his supporters have challenged it in the Supreme Court. But the president has welcomed a possible binding referendum halfway through his six-year-term, or August, as allowed by the constitution.

The 48-year-old Chavez was elected in 1998 and re-elected in 2000 on promises to redistribute the country's vast oil wealth among the poor majority.

His opponents accusing him of steering the economy into recession with leftist policies and running roughshod over democratic institutions.

www.newsday.com By GEORGE GEDDA Associated Press Writer January 21, 2003, 4:59 PM EST

WASHINGTON -- Leaders from the United States and five other Democratic countries will meet here Friday in hopes of finding ways to help Venezuela overcome a political impasse between the government and the opposition.

The meeting will be hosted by the Organization of American States, which until now has taken the lead in resolving the stalemate. OAS Secretary General Cesar Gaviria has spent much of the past two months in Venezuela, but he has been unable to bridge differences between the parties over the timing of a new election.

Former President Carter, in Venezuela Tuesday on his second mediation visit, proposed an election plan that both sides are studying.

U.S. officials have strongly supported Gaviria's efforts and see the Friday meeting as a supplement to his activities.

Joining the United States at the meeting will be Mexico, Brazil, Chile, Spain and Portugal -- members of a newly formed "Friends of Venezuela."

The meeting will be at the foreign ministers level but it is not clear whether Secretary of State Colin Powell will attend. He will depart Friday afternoon for a meeting in Switzerland.

Chile's foreign minister, Soledad Alvear, will not attend for personal reasons.

The United States has been concerned about the possible effect on world oil supplies of sharp cutbacks in Venezuela's oil production, resulting from a politically motivated strike by oil workers.

Last Friday, Venezuela's embattled president, Hugo Chavez, said he welcomed the creation of the "friends" group but recommended that it be expanded to include Russia, France, Algeria and China. Diplomats say the current makeup of the friends group achieves a needed balance. Brazil under new President Luiz Inacio Lula da Silva is seen as perhaps the most sympathetic to Chavez. The Bush administration, meanwhile, has never been a strong backer of Chavez, who has a warm relationship with President Fidel Castro.

Strike leaders want Chavez to agree to a plebiscite in February on his presidency. Although the vote would be nonbinding, these leaders believe Chavez would be pressured by the outcome to step down.

The opposition believes Chavez has ruined the country's economy and tried to gather too much power in his own hands.

Chavez said any plebiscite held before August would be unconstitutional. Venezuela's constitution allows for a binding recall referendum halfway through the presidential term, which would be August.