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Last Updated: Tuesday, 17 August, 2004, 06:44 GMT 07:44 UK
Analysis: Venezuela at a crossroads
By James Menendez
BBC correspondent in Caracas

When Venezuelan President Hugo Chavez stepped out on to the "people's balcony" of the presidential palace to make his victory speech, he could barely contain his delight.

The referendum had been hanging over him for more than a year. But now he had defeated the attempt by his opponents to force him out of office.

Venezuelan President Hugo Chavez and his children, from left to right, Hugo, Rosa Virginia, and Maria Gabriela celebrate in the Palace of Miraflores in Caracas on Monday
Happy families: Chavez celebrates victory with his children

This was his moment, proof that he had the majority of the people on his side.

Mr Chavez had always insisted he would win. He had predicted it would be a crushing defeat for his opponents.

But did he really believe the margin of victory would be so great?

Just a few months ago, most polls put his support at about 30%. In the referendum, he scored 58%.

That is an extraordinary turnaround, and one that defies easy explanation.

Tide of support

Certainly the Chavez campaign was extremely well-funded and highly visible. Posters, flags and banners covered the city. Newspaper, radio and television adverts boasting of the government's achievements were repeated constantly.

It clearly had an impact. On the basis of the referendum result, President Chavez is as popular now as when he was re-elected in 2000.

Opposition supporters burn flags from the pro-Chavez campaign
Inflamed: Can an angry opposition bear to accept the result?
For the opposition, it is highly suspicious. Before the first results were released, opposition leaders appeared on television to thank their supporters for turning out and, in some cases, spending the whole day waiting to vote.

They were not allowed to give predictions, but the broad smiles said it all. One prominent figure even raised two fingers to indicate victory. They were convinced they had won. Privately, they believed they had defeated Mr Chavez by a significant margin.

Instead, it was the other way round. The opposition is now crying foul, accusing the government of "gigantic fraud".

They point to alleged irregularities in the way the votes from each polling station were collected and added up.

But that is sounding rather hollow now. A team of international observers led by former US President Jimmy Carter has said it found no evidence of fraud.

Opposition conundrum

That leaves the opposition in a difficult position. If they now accept that judgement, they will have to wait until presidential elections in 2006 for the next opportunity to try and remove President Chavez.

If they do not accept it, they risk inflaming an already tense situation and possibly losing their credibility.

Either way, there is likely to be considerable upheaval within the Democratic Co-ordinator, the loose coalition of political parties, business leaders, trade unions and interest groups that make up the opposition.

They just about managed to maintain a united front leading up to the referendum, but without a common goal, that coalition may well just collapse. That would leave Mr Chavez's opponents even weaker.

The question now is whether the president will try and bridge the deep divide that has emerged in Venezuela in the last few years, or whether he will take advantage of their weakness to pursue his own agenda even more aggressively.

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