PRESS CONFERENCE BY PRESIDENT OF VENEZUELA

PRESS CONFERENCE BY PRESIDENT OF VENEZUELA

At a Headquarters press conference today, President Hugo Chavez of Venezuela responded to questions focused largely on his reaction to the attempted coup d'état in April and a possible attack against Iraq, including the projected effect on oil producing nations.

Not only military force could protect Presidents and Prime Ministers from coups d'état; a strong unity of the people within countries was needed to guard against any fascist attempt at a coup, whether one came from within or without, he said to one question.  Venezuela's great strength was derived from its populace, which, in the face of the coup, had expressed a courageous unity and responded swiftly.  "Before the cock could crow", they had overthrown the perpetrators.  Of course, the armed forces also defended the Government.

To a question about the Tripartite Commission, he said one issue put forward had been that of the need to reform its highest electoral body -- the National Electoral Council.  The Government was in complete agreement with that vital need for reform and understood the corresponding need to adopt a law to allow for that reordering.  Other topics discussed, which also had his Government's support, included disarming the civilian population. 

Yes, there was sufficient proof of the media's involvement in the State coup, in particular, the broadcast media, which had transmitted the demonstrations of the participants in the coup, he said to another question.  They had all equipment available to make sure the transmissions had succeeded.  Even some recorded communiques from the perpetrators had been transmitted later as if those were live. 

He said the media had even manipulated sectors of the population, particularly the upper middle class.  State television went off the air, and private television transmitted everything, saying that "Chavez was a murderer". That had been intended to justify the State coup.  Following the dissemination of events by the "coup government", a statement of his stepping down was to be recorded.  He was actually imprisoned and all television channels were reading his resignation.

It was too premature to advance a position on a possible military attack against Iraq, he replied to a further question, adding his hope that the situation could be resolved peacefully.  Member countries of the global Organization of the Petroleum Exporting Countries (OPEC) were assessing that disturbing situation.  Of particular concern were the economic and commercial ramifications of such military action, especially oil prices.  He had always supported ensuring a balanced price, between $22 per barrel, as a minimum, and $28 as a maximum. 

Given the hypothesis of an attack against Iraq, however, such an attack would undoubtedly have a considerable impact -- he did not know precisely in figures what that impact would be -- on the oil market.  But, certainly it would "shift the balance" that had been achieved in the oil market over the past few months regarding supply and demand.  He had not known the reaction of the other

Arab-speaking countries, such as Saudi Arabia, Iran, Kuwait, United Arab Emirates -- all of them, oil producers.  Such an attack would have an impact, however, and would change the balance in the market; possibly, demand would drop. 

In OPEC, he continued, it had been calculated that for every million barrels of oil per day that were put into the oil supply, the trend for the prices to drop would be by $2 per barrel.  Cutting back a million in the supply would cause an increase of $2 per barrel -- that was an historic average.

He said that an attack against Iraq might lead to a drop in the supply of oil, which, in turn, might be a destabilizing factor in the Middle East countries and affect the world economy.  OPEC, thus, might decide to avoid such an imbalance or shoulder some of the shortfall.  The assembly of OPEC ministers was meeting tomorrow in Japan. 

He added that many oil producing countries did not have the capacity to produce any more than they were already producing.  If a country produced one million barrels per day, for example, they might not be able to produce any more without additional investment, even if they had the oil in the ground.  In Venezuela, for example, there was a plan to increase production by approximately three million barrels per day, bringing to five million barrels per day the total production by 2005.  That plan required an investment of $30 billion. 

Unemployment in Venezuela was not as high as 20 per cent, he said to another question; it was just under 15 per cent.  It had risen, especially in the first half of the year, when there had been considerable economic decline.  Others in Latin America had shared Venezuela's economic difficulties.  Even the economies of the United States and Japan had encountered major problems last year.  The interconnectedness of economies today especially affected the weaker economies.

The Venezuelan economy still depended essentially on oil, he added.  He wanted a diversified economy that did not depend on just one export.  The price had declined after December to $14 per barrel from $22 per barrel, and the budget had been based on $20 per barrel.  So, of course "that plunged us into a fiscal crisis".  Also, the conspiracy and increased public tension had led the Central Bank to create a different policy, and the right balance was still being sought. 

Meanwhile, the Government had undertaken budget cutbacks and tax reform; the price of oil had recovered, and the second half of the year promised to be much better than the first, he said. 

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