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Page last updated at 18:30 GMT, Thursday, 6 August 2009 19:30 UK

Chavez fumes at neighbour Colombia

By Will Grant
BBC News, Caracas

President Chavez shows off a rocket launcher at a news conference on 5 August
Mr Chavez insists Venezuela has played no part in arming Colombian rebels

There are few world leaders who would produce anti-tank rocket launchers in the middle of a news conference.

But Hugo Chavez has never been a conventional leader.

As he addressed journalists on Wednesday, he said the props were necessary to show that Colombia was lying when it suggested Venezuela had been arming Colombian rebels.

After explaining in detail to the assembled media how to use the weapons, the Venezuelan president said it was clear how easy it would be to fabricate the photographic "evidence" produced by the Colombian government to accuse Venezuela of supplying the Swedish-made rockets to the left-wing Farc guerrilla group.

The rockets in the photos were 14 years old, Mr Chavez said, and had been stolen from a military base in Venezuela.

President Chavez, who last week recalled the Venezuelan ambassador to Colombia, used Wednesday's news conference to announce he was halting the import of 10,000 cars from Colombia and seeking to substitute Colombian products with goods from other countries.

Distrust

This is far from the first time the two neighbours have fallen out. As recently as March last year President Chavez broke off all diplomatic relations with Colombia and recalled his ambassador over what was soon to become "the Andean crisis of 2008".

In that instance, a cross-border attack by the Colombian military on a group of Farc rebels on Ecuadorean territory - during which the guerrilla leader, Raul Reyes, was killed - sparked one of the worst diplomatic disputes in the region since the end of the Cold War.

At the time, Mr Chavez ordered 10 tank battalions to the border with Colombia in the midst of an escalating conflict that was eventually smoothed over at a regional meeting a few days later.

Colombian soldier stands at enterance to bunker used by Farc rebels
Farc rebels have been fighting the Colombian state since the 1960s

While last year's episode was over within the space of a week, the distrust it created between the main protagonists apparently persists.

"He is shameless," President Chavez said of his Colombian counterpart, Alvaro Uribe. "I'm very sorry, but he does whatever the yankees tell him to."

At this stage it is hard to know whether the situation will escalate beyond the war of words of 2008.

There have been several moments in recent weeks which have put the two presidents on bad terms.

Among them was a video released by the Colombian authorities which they said showed a key Farc leader saying the group sent money to the election campaign of Ecuadorean President Rafael Correa, who is an ally of Mr Chavez. Mr Correa has vigorously denied the accusations.

But it was undoubtedly the accusation about supplying arms to the Farc which was the final straw for the Venezuelan leader.

"Colombia is trying to blackmail us with this situation," he said, suggesting that the photos were part of an elaborate plan to equate him with terrorism and drug-trafficking, to justify a controversial move to grant the US military permission to operate from several military bases in Colombia.

"The bases will give the American military greater mobility in trying to control the guerrillas' activities in the region," says Elza Cardoso, international affairs professor at the Metropolitan University in Caracas.

"But from President Chavez's perspective, he thinks Colombia is being turned into the Americans' base of operations against Venezuela. He thinks that everything else - the video, the accusation about the Farc's weapons, and certain denunciations about Venezuela's relationship with Iran - is part of a conspiracy to allow an increased US presence on his border."

The word President Chavez has used is "smokescreen", alleging that "Washington is trying to turn Colombia into the Israel of Latin America".

"I think by that he is trying to portray Colombia under Uribe as an isolated US ally in Latin America, as a lonely country, the only one which has such a close relationship with the US, such solidarity with Washington," says Professor Cardoso.

"But also, he's saying that Colombia is a country which can aggressively respond to any provocation."

Co-dependence

But while the diplomatic impasse might have been predicted, what is concerning many business figures in the region is the decision by President Chavez to try to freeze bilateral trade relations.

Trucks wait to cross into Venezuela along the border in Cucuta, Colombia, 30 July
Trade between the two countries runs to about $7bn a year

"Trade with Colombia isn't indispensible," he has said.

Trade between the two nations came to more than $7bn (£4.1bn) last year. So how feasible is it that President Chavez can reduce that flow of goods and services to a trickle?

"In the short term, that won't be very easy at all," says economist Asdrubal Olivares, director of the Ecoanalitica think tank.

"It's a relationship of total co-dependence. Venezuela relies on Colombia for food and basic goods, but Colombia similarly needs the Venezuelan market."

President Chavez suggested Brazil or Argentina could step in to take over from Colombia, but again Mr Olivares has his doubts.

"It's not as simple as the president makes it sound. You're talking about Colombian providers and companies who have spent decades, in some cases their entire lives, living and working in Venezuela - as well as many Venezuelan companies based in Colombia.

"They know the idiosyncrasies of working here, they have well-established contacts, and crucially, it's a cheap, overland supply route. Starting from scratch with a more 'Chavez-friendly' nation, such as Brazil, Ecuador or Bolivia, will take time."

Nevertheless, the Venezuelan government has a key card to play.

Natural gas - exports of which have gradually risen to 8.5m cubic metres (300m cubic feet a day) - makes up a significant proportion of its exports to Colombia.

The Venezuelan energy ministry recently released a statement saying that agreements over the supply of fuel to Colombia were "under evaluation" in accordance with the president's wishes.



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