Venezuelan strike falters

Oil production has increased, the stock exchange reopened and the opposition infighting over how to continue their actions against President Hugo Chavez has become public.

" If some sectors of the opposition, business sectors or political sectors, think they can save themselves from this regime by easing the strike, they are totally mistaken "
Carlos Ortega
Strike leader

Striking oil workers now concede that production has recovered to 966,000 barrels per day, about a third of pre-strike levels, from the lows of 150,000 in December.

The government of the world's fifth largest oil exporter says output is currently at 1.32 million barrels a day.

The Caracas stock exchange gained over 10% when it resumed operations on Monday after its last session on 29 November.

"You can't close indefinitely," said exchange president Nelson Ortiz.

"The government didn't pressure us at all into reopening," he said adding it would trade for limited hours every day.

Strikers infighting

Faced with the possibility of bankruptcy, many private businesses, restaurants and stores have already broken the strike and private banks continue to open everyday, but for limited hours.

A strike leader has condemned the return to work by business.

"If some sectors of the opposition, business sectors or political sectors, think they can save themselves from this regime by easing the strike, they are totally mistaken," said union leader Carlos Ortega.

Several business leaders have said that schools, restaurants and shopping malls should be allowed to reopen.

"Some people plan to reopen some commerce, industry and work activity," opposition leader Julio Borges told reporters.

"We must respect that as the strike is voluntary."

Mixed messages

But strike leaders said the walkout at the state oil monopoly, Petroleos de Venezuela (PDVSA), which provides half of government revenues, would continue.

The government, however, claims most of PDVSA's 40,000 employees have returned to work after 3,000 managers were sacked.

Last week some oil tanker pilots agreed to return to work.

But the true state of affairs within the oil refineries and aboard platforms is not known.

The strike at the oil work is having the most dramatic effect on the economy.

Business strike breakers

To prop up the economy, Venezuela on Monday extended a suspension of foreign exchange trade until 5 February to offset the damage caused by the strike and maintain its foreign reserves.

"If we hadn't suspended trading, there would have been continual withdrawals, creating a banking crisis," Finance Minister Tobias Nobrega told local television.

"We are losing international reserves dramatically ... about $60m a day," he said.

The government plans to introduce a fixed exchange rate, after the bolivar lost a quarter of its value this year, but no level has been given.

International intervention

Representatives from six nations - led by the US and Brazil - are due in Caracas on Thursday to try to broker an end to the crisis.

Former US President Jimmy Carter has tabled constitutional reforms to shorten the president's term or hold a binding referendum on Mr Chavez's rule in August.

He was elected in 1998, re-elected two years later, and his term ends in 2007.

Business leaders fear popular discontent with food and fuel shortages caused by the strike could undermine their attempt to remove Mr Chavez from office.

The strike is estimated to have cost Venezuela at least $4bn.

As a result, the economy could shrink by up to 40% in the first quarter of 2003.