/ 9 January 2003

Bank strike deepens crisis in Venezuela

Hugo Chavez will come under further pressure to resign as the president of Venezuela today when bank workers join the paralysing strike which has already lasted more than six weeks.

As the government announced plans to restructure the state oil company, which has been at the heart of the general strike, the bank union confederation announced a two-day stoppage.

The strike will affect cash machines nationally, making it even more difficult to obtain money. The banks are already offering only a limited service, despite being told by the government to restore a full service or face penalties.

The energy minister, Rafael Ramirez, announced that the state oil company, PDVSA, would be radically restructured and split into two, and its Caracas headquarters would be largely dismantled.

About 30 000 PDVSA employees, including executives, managers and senior technicians, are on strike, severely damaging the country’s oil production, which is estimated to be a fifth of normal.

Ramirez said in a broadcast that a new board ”with a more strategic vision” would be appointed to run the company ”at the service of the nation”.

Striking oil executives say that every day of the strike causes greater damage to the industry and the economy.

On Tuesday thousands of Venezuelans tore up their tax return forms outside the national tax agency in protest against Chavez.

The president remained in defiant mood, no doubt reinforced by reports that the strike was slackening off.

His opponents are now putting their energies behind plans for a referendum on his rule, which they want held on February 2.

But it is unclear whether there will be a vote, and whether it would have have any legal standing if it were held.

President Chavez has already said that he will not be bound by it.

Under the constitution which he himself introduced Chavez is subject to a referendum on his rule, which could be called in August, and he has said that that is the proper time to cast votes. His opponents say that the economy is in such a crisis that a referendum cannot wait.

President Chavez, who is halfway through his elected term of office, responded to the tax protest by taking to the airwaves to warn that tax evasion was an offence punishable by up to seven years in jail. ”It’s a crime not to pay taxes,” he told Venezuelans in a speech broadcast on all the radio and television networks.

”We will not tolerate it. We’ll take all actions necessary to make sure every last cent is paid because it belongs to the people.”

Negotiations between representatives of the opposition and the government, under the auspices of the Organisation of American States, resumed this week in Caracas after a break for the holiday period.

A representative for the OAS director general Cesar Gaviria said he remained optimistic that a peaceful solution to the crisis could be found.

Five people have so far been shot dead in clashes and many others injured. Each side has blamed the other for provoking the violence.

The United States has played a changing role during the crisis.

A call for elections, made in December, was later reversed by the White House representative Ari Fleischer, who then suggested a referendum ”as anticipated in the Venezuelan constitution”.

The US media, whose coverage is watched keenly by the opposition in Venezuela, has been reporting a fall in support for the strike.

The Wall Street Journal reported yesterday that the strike was ”partly running out of steam, with life on the streets and neighbourhoods appearing to return to normal”.

The Colombian president, Alvaro Uribe, called on Venezuelans yesterday to reach a peaceful solution.

”You should listen to us Colombians, because here we have suffered so much from violence,” he said in a radio interview. – Guardian Unlimited Â