April, 2003

Venezuela: Regional and International Efforts to Contain the Crisis

Reda Mohammed Helal

President of Venezuela Hugo Chavez managed in March 2003 to end a political and economic crisis that began nearly a year earlier, in April 2002, during which time he faced a tough challenge from opposition parties and labour syndicates. After securing a second term in office in mid-April 2002, following a failed coup attempt, Chavez vowed to implement a number of reforms. Investigations into the outbreak of violence between police and demonstrators on 11 April 2002, during which dozens were killed and around 300 injured, were halted by Chavez, prompting a public outcry and further demonstrations.

Some opposition parties and a number of syndicate leaders filed cases against Chavez to compel him to resume the investigation. Supreme Court approval for the president's decision to end the investigation was strongly criticised by many and led to accusations of corruption in the judiciary authorities. Further demonstrations erupted, both for and against the president, which led to an opposition-led across-the-board public strike starting from 2 December 2002. As a result, oil production slowed and the economy faced daily losses of nearly $100 million. The opposition presented a number of demands to end the crisis, including the holding of early presidential elections.

Chavez responded with a strategy designed to secure his position while ending the strike peacefully. He tightened his grip on private sector institutions, implemented a number of resolutions to limit recession and imposed strict restrictions on the exchange of hard currency. He further aimed to alleviate the pressure against him by decreasing the popularity of opposition leaders - on the domestic level - and deflecting pressure from the Organisation of American States -OAS- and the US administration - on the regional and international levels. The government proposed a meeting with opposition leaders to discuss their requests, and also accepted a Brazilian proposal to form a regional and international forum to settle the crisis.

After several rounds of talks between Chavez and opposition powers under the sponsorship of the Group of Friends of Venezuela and the secretary-general of the OAS, a preliminary agreement was reached on 20 February 2003. This agreement stipulated: an end to the exchange of accusations; contribution from all political and social groups to create an atmosphere of peace; formation of an investigation panel to look into the disturbances of 11 April 2002; and the continuation of negotiations over the holding of a referendum in August on issues previously agreed.

The opposition thus made several gains through their efforts. Chavez, however, having put an end to the strike - which cost the Venezuelan economy more than $5 billion - has begun to take a more strong-arm approach to his opposition. Following the president's orders to arrest various opposition leaders on charges of treason, the resumption of negotiations between them seems remote.