www.falkland-malvinas.com Wednesday, 19 February

Venezuela’s president Hugo Chavez administration and the opposition signed a non aggression pact aimed at defusing tensions, according to the Organisation of American States, OAS, that has been mediating in the increasingly violent and acrimonious conflict.

OAS Secretary General Cesar Gaviria who has been at the head of the negotiations, backed by a six nations group including United States and Spain said the document is a foundation for a confidence building process.

Venezuelan opposition, mainly middle class, have been demanding president Chavez’s resignation alleging the current administration is leading the country to a Cuban style authoritarian regime. Mr. Chavez, the father of the poor, as he’s called by supporters, and a close friend of Mr. Fidel Castro, was re-elected in 2000 and refuses to consider calling a referendum on his rule until next August, as constitutionally viable.

“With the declaration we hope to bring a climate of understanding between all Venezuelans”, said Mr. Gaviria.

The seven point declaration rejects “verbal intemperance, mutual recrimination, verbal attacks and any rhetoric aimed at confrontation”, and calls on all political and social factions “to create a climate of peace and calm in the country”.

Opponents call Mr. Chavez a “tyrant” and “monkey commander”, while the president describes opponents as “fascist coup-plotters”.

An ongoing national strike and a wave of demonstrations by both sides have paralyzed the country, led to killings and shootings, and endangered the country’s oil production, one of the main United States suppliers.

Mr. Chavez, who last April survived a two days coup, has used troops and foreign replacement crews to restart the oil sector after the unions of Petróleos de Venezuela, the government managed company, went on indefinite strike.

Oil represents 80% of the country’s exports and 60% of government revenue.

news.ft.com By Andy Webb-Vidal in Caracas Published: February 19 2003 4:00 | Last Updated: February 19 2003 4:00

Venezuelan government and opposition representatives were yesterday due to sign a pact condemning political violence, the first breakthrough in three months of internationally backed talks aimed at finding an electoral solution to the country's political deadlock.

The agreement, brokered by César Gaviria, secretary-general of the Organisation of American States, should ease tensions between the government of President Hugo Chávez and the alliance of opposition interest groups ranged against him, analysts said.

Venezuela has been marked by rising levels of street violence, including several deaths in recent months as timid efforts at dialogue between Mr Chávez and his foes in the wake of last April's coup attempt collapsed, prompting the involvement of the OAS.

Opponents say Mr Chávez, although democratically elected four years ago, is bent on abolishing democracy in favour of an autocratic leftist government modelled on that of Cuba's Fidel Castro.

In turn, the populist Mr Chávez, who led a failed military coup in 1992, brands the opponents of his self-styled "Bolivarian revolution" as "coup-plotters".

Among his opponents are now over 12,000 employees who have been fired from Petróleos de Venezuela (PDVSA), the state oil company, following an ongoing strike that began in December and has slashed output in what was the world's fifth-largest oil producer, crippling the economy.

Analysts said the non-violence agreement suggests some kind of election could be in the offing in the months ahead. "The pact demonstrates that it is possible to reach agreements, and if that is possible, then anything is," said Alfredo Keller, a political consultant.

"However, the impression I have is that Chávez is not interested in an election in which he participates. He is not going to permit that the only visible head of the 'revolution' runs the risk of an electoral defeat," said Mr Keller.

Mr Chávez has in the past two weeks stepped up measures apparently aimed at shoring up his base support among the poor, a move that could pave the way for polls in which regional governors and mayors participate.

But activity geared towards some kind of early poll, this year, is gathering within the opposition camp, with signs that Manuel Cova, secretary-general of the Venezuelan Workers Confederation, is being promoted by some groups as a presidential candidate.

seattlepi.nwsource.com Tuesday, February 18, 2003 · Last updated 1:39 p.m. PT THE ASSOCIATED PRESS

CARACAS, Venezuela -- Venezuela will begin selling foreign currencies, under stringent restrictions, through state-run banks, the president of the nation's exchange control commission said Tuesday.

The announcement by Edgar Hernandez came as the exchange control commission, or Cadivi, signed agreements with the Banco Industrial and the Andes Development Bank, both run by the government.

"The objective is opening operations for buying currencies," said Hernandez, adding the two banks would begin exchange operations "as soon as possible."

Hernandez said he expects private banks to sign similar agreements within a week.

The government suspended foreign exchange sales Jan. 21 as panic buying of U.S. dollars amid a two-month general strike led to a drastic drop in foreign reserves.

The suspension was also meant to give the government time to hammer out details of an exchange controls plan, which fixes the local bolivar currency at a rate of 1,598 bolivars to one U.S. dollar.

The bolivar is trading between 2,200 and 2,500 to the dollar on the black market.

Opponents of President Hugo Chavez fear the new exchange controls system could be used by the government to punish its detractors, including businesses that participated in the strike to unseat him. The strike ended on Feb. 4 in all sectors except the all-important oil industry.

More than 60 percent of the food, medicines and finished goods consumed by Venezuelans are imported. Without access to the dollars needed for imports, businesses are partly paralyzed and there are shortages of some goods.

Last year, annualized inflation hit 31 percent, sparked by a 46 percent devaluation of the bolivar. The currency devalued a further 25 percent this year before the halt on currency trading was imposed.

Chavez, who was elected in 1998 and re-elected in 2000, claims the nation's economic problems are the result of an "economic coup" led by his opponents.

Venezuela's opposition, a coalition of political parties, labor unions and business groups, accuses Chavez of trying to quash dissent and establish a Cuban-style dictatorship in the South American nation.

news.ft.com By Grant Nulle Published: February 18 2003 4:00 | Last Updated: February 18 2003 4:00

Sir, Moisés Naím, editor of Foreign Policy magazine, ridiculed the Bush administration's sluggish response to recent explosive events in Venezuela ("Venezuela gets a nimble hand from Castro", January 21); but is it really alarming that Washington for once decided not to intervene unilaterally in a hemispheric nation?

Mr Naím's single-factor analysis of the Venezuelan crisis and Cuba's alleged pivotal role in it smacked of an obsolete cold war mentality. He did not introduce a single piece of serious and non-anecdotal evidence to support his charge.

Sadly, his thesis brought nothing to the debate that differs from the simple-minded, anti-Castro paranoia fostered by many fellow members of Venezuela's middle-class opposition, who see President Hugo Chávez as Havana's puppet.

This is not analysis so much as banality.

Doubtless, subsidised Venezuelan oil is helping the Cuban economy; but both Venezuela and Mexico have done this episodically for years, supplying discounted petroleum to other Caribbean basin countries.

Fidel Castro, Cuban president, would only lose financially and geopolitically by encouraging Mr Chávez to quicken the pace of his "Bolivarian revolution". Nor does a shred of evidence exist indicating that Mr Castro has directed Mr Chávez to radicalise his relations with the US through his intransigence, which unfortunately appears to be an intrinsic feature of the Venezuelan's prickly personality. In fact, the opposite is more likely, given the Cuban leader's counsel to President Salvador Allende to engage constructively the US during his 1971 visit to Chile, which he repeated to Grenada's Maurice Bishop in the early 1980s and Panama's Manuel Noriega in the late 1980s.

As for the influx of several thousand Cuban civil personnel into Venezuela, is Mr Naím telling us that only the US can have its Peace Corps? Exporting specialists to foreign states - doctors, teachers and sports coaches - irrespective of the host nation's political orientation has long been a mainstay of Cuban diplomacy, with few ascertainable intelligence pay-offs.

Instead of ominously pointing to Mr Castro's inroads in the Caribbean, the author should recall that relations between states are conducted for mutual benefit. If the English-speaking islands decide to enlarge the Caribbean Community to include Francophonic Haiti, why shouldn't it accord limited status to Havana, the Caribbean's largest island?

Mr Naím repeatedly employed a Castro allusion in a failed effort to clarify further the current Venezuelan tragedy. But in spite of his best efforts, neither Mr Chávez's intemperate personality nor Venezuela's disloyal and coup-prone opposition were authored by Havana.

Evoking a Cuban bogey and a sinister leftist spear-thrower in Mr Chávez is at the least simplistic, since Cuba's weakened economy stands to be one of the main losers if Mr Chávez's consensual survival is not achieved.

Grant M. Nulle, Research Associate, Council on Hemispheric Affairs, Washington, DC 20036, US

www.forbes.com Reuters, 02.17.03, 5:16 PM ET

CARACAS, Venezuela, Feb 17 (Reuters) - Venezuela's largest private energy generator and distributor, Electricidad de Caracas (EDC) <EDC.CR>, on Monday reported a 53.143 billion loss during 2002 compared with a 89.244 billion bolivar profit in 2001. EDC said the loss was due to a devaluation in the local bolivar currency, a drop in demand of electric energy and increases in fuel prices. Telecommunications and service firm Corporacion Electricidad de Caracas <EDC.CR> (CEDC), the sister firm of Electricidad de Caracas, showed a loss of 215.483 billion bolivars during 2002, compared with a profit of 32.364 billion in 2001, a company statement said. Both companies are affiliates of U.S. power firm AES Corp (nyse: AES - news - people). ($1=1,403 Bolivars, Dec. 31, 2002 rate)