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 Philip Sherwell: Death of Hugo Chavez
could set off shock waves across region


The likelihood that Venezuela's Hugo Chavez is close to death will pitch rivals against one another in a battle for power and oil riches, and trigger political shock waves across the region.

The orchestra played and loyal lawmakers erupted in adulatory applause as Hugo Chavez invoked Fidel Castro and Jesus Christ as his revolutionary role models.

His right hand raised, the fiery Venezuelan leader echoed the famous call to arms of his Cuban mentor. "Fatherland, socialism or death," he proclaimed, then added with a typical flourish: "I swear by Christ, the greatest socialist in history." That was six years ago as "El Commandante" was sworn in for his third term as president and blew kisses to rose petal-tossing crowds when he returned in an open-topped car to his palace to watch a military parade.

On Thursday, the ideologue - who has used his country's oil riches to bankroll left-wing bed-fellows across Latin America, forged a cosy alliance with Iran and assailed the US from its back yard - is due to be celebrating his next inauguration.

But there will be no joyous scenes. For this weekend, he is lying close to death in a Cuban hospital bed, quite possibly being kept alive on a ventilator, suffering from respiratory problems and a severe lung infection after his fourth round of surgery in 18 months for an undisclosed type of pelvic cancer.

His illness has already sparked a constitutional crisis in Venezuela, where he won a hotly-contested election in October but has not yet started a new term. His death would send shock waves across the region and could endanger the survival of Cuba's communist regime which is dependent on his largesse for cheap oil.

And despite their protestations of socialist solidarity, his senior lieutenants have already begun a power struggle to replace the 58-year-old former paratroop commander who has ruled the country as a one-man show since 1998.

With the president's demise, several factions will be vying for control of the country's political future and oil wealth -- the diehard ideologues known as Chavistas; his former comrades in the powerful armed forces; the rich and powerful Chavez clan, led by his older brother Adan; and the new breed of politically-connected tycoons who have enriched themselves hugely even as its leader pursued his "21st century socialism".

On Friday night, Nicolas Maduro, the country's vice-president and Mr Chavez's anointed successor, gave the clearest indication that the inauguration might not take place on Thursday, claiming that Mr Chavez could instead be sworn in by his Supreme Court appointees, at a later date and unspecified location - if still alive.

That stance will infuriate opposition leaders who insist that the constitution requires Mr Chavez to take the oath on Jan 10 or for new elections to be called within 30 days. But their view is unlikely to win the day in a country where the ruling party dominates all branches of government.

And on Saturday, Diosdado Cabello was re-elected as National Assembly leader, putting him inline to become caretaker president if Mr Chavez does not recover.

The vote cemented his position as the third most powerful figure after the president and Mr Maduro, his potential rival.

"As a patriot ... I swear to be supremely loyal in everything I do, to defend thefatherland, its institutions, and this beautiful revolution led by our Comandante Hugo Chavez," Mr Cabello said as he took the oath. Outside, red-clad Chavez supporters chanted their support for their absent leader.

Amid this manoeuvring, the newspaper El Nacional lamented an "information vacuum" and compared the situation to the secrecy that surrounded the deaths of Soviet dictator Josef Stalin and Mao Zedong in China.

And indeed, the parade of high-profile visitors to Mr Chavez's Havana hospital in recent days has resembled the scene at the bedside of a dying mediaeval monarch surrounded by kin and court paying tribute.

His elderly parents and six brothers -- who have flourished politically and financially on his coat-tails in his home state of Barinas -- have visited, along with four children by two ex-wives and miscellaneous other relatives.

But just as significant were the two major political figures who flew in to the Cuban capital -- Mr Maduro and Mr Cabello - the men at the centre of the palace intrigues.

The upper hand for now is undoubtedly with Mr Maduro after Mr Chavez last month urged Venezuelans to back him as his successor. He is a former bus driver and bear of a man who has displayed not only slavish devotion to Mr Chavez at home but also shares his idolising of the Castros.

"If Maduro runs and wins in new elections, he'll amount to little more than a puppet of Havana," said Gustavo Coronel, a former Venezuelan congressman. "This would amount to Cuban regency." But for all his fealty to the cause, Mr Maduro is also widely regarded as an unsophisticated political operator who parrots Chavez lines without the charisma to galvanise followers or strength to unite feuding factions.

Mr Cabello is by contrast not only a more astute political player, he is also a former army officer who took part in the failed Chavez coup of 1992 and hence commands considerable support in the country's powerful armed forces.

He is also said to be the beneficiary of close ties with the country's politically well-connected "Boligarchs" – oligarchs who have flourished under the "Bolivarian revolution", named after the South American liberation hero Simon Bolivar venerated by Mr Chavez.

As National Assembly president, he may also be called on to serve as acting president if new elections are called. So if Mr Maduro seems to be flailing after death of his mentor, few doubt that Mr Cabello would see his chance.

For both men, wooing the kingmakers in the president's family will be crucial. Indeed, Adan Chavez, a former ambassador to Cuba, education minister and now governor of the family fiefdom of Barinas, was just 18 months ago being touted as a dynastic successor when his brother suffered his first bout of cancer.

But the prospect of a Castro-style fraternal handover later faded, not least as Adan lacks the political skills of his younger sibling.

Nonetheless, how the power struggle plays out will be watched very closely on the grassland expanses of Barinas where Mr Chavez was born, the second of seven sons of the local schoolmaster, in a small dirt-floor home in Sabaneta.

They were suitably humble origins for the man who would turn into a left-wing firebrand. But the talk in Barinas now is of how the Chavez clan has prospered since politics here became a family affair.

Mr Chavez's father, Hugo Sr, ran the state as governor for a decade, assisted by his son Argenis as his top aide. Argenis moved on to head the National Electricity Board and the state is now governed by Adan.

Another brother Anibal twice served as the mayor of Sabaneta, the president's birthplace, while Adelis Chavez is vice-president of the bank that handles the state accounts.

Yet another brother, Narciso, was made responsible for state co-operation projects with Cuba. Various other relatives also have senior positions with government agencies.

The family's prosperity flourished with their political power. Their small chicken and pig farm is now a sprawling state-of-the art ranch. And in Barinas, they live in a luxury mansion in a high-walled compound in the most exclusive neighbourhood and travel in convoys of heavily-armed SUVs that screech through the streets.

Opposition figures in the state have claimed that they own up to another 20 estates through frontmen and that they have benefited from construction projects.

In Venezuela's poorest state, the ostentatious displays of wealth, including the penchant of the president's mother Elena Frias for expensive designer clothes, are a growing source of resentment, although the family deny opposition claims of corruption and nepotism.

Noel Zamudia, a local party official and childhood friend of the president, told The Sunday Telegraph that "the revolution" would live on, whatever the fate of Mr Chavez.

"The president himself said that revolution is not about a man and the people understood that. Those who fail to understand this are right-wing militants who despise the people. If Hugo dies, if that is God's decision, then the revolution will continue its path." But Miguel Oraa, an opposition leader in Barinas, predicted that the death of Mr Chavez would end the edifice of his rule. "There is no revolution without Chavez," he told this newspaper. "People say 'I am a Chavista, not a revolutionary'. Chavismo without Chavez does not exist, it falls apart. The empire collapses completely." Indeed, opinion polls last year indicated that Henrique Capriles, the opposition leader, would beat any Chavista candidate in fresh elections. But an election held in the wake of Mr Chavez's death could deliver a powerful and decisive sympathy vote for a Chavez heir.

Whoever succeeds him, the Venezuelan leader will be bequeathing his successor a dire and destabilising economic prognosis, for all the country's oil riches.

The very fact that he has repeatedly sought medical treatment in Cuba over the last 18 months for his recurring cancer is a damning indictment of his stewardship of Venezuela, say his critics.

He has undergone surgery, chemotherapy and radiation treatment there because the financially-stricken communist Caribbean outpost has a better health service than Venezuela, despite being much poorer.

Mr Chavez has instead lavished the windfall of the world's largest known oil reserves to support his left-wing allies abroad and cement the loyalty of the dependant poor at home.

Mr Coronel, a former oil industry executive who tracks corruption in his homeland, estimates that Mr Chavez has spent a mind-boggling $1 trillion of state funds to support foreign allies or domestic political constituencies who support him.

But that lavish cheque-book socialism has taken a disastrous toll on coffers that should be flush thanks to high oil prices.

The country has a surging fiscal deficit and its economy is crippled by the sort of price and currency controls favoured under state socialism. Inflation is soaring, the overvalued Venezuelan Bolivar is sliding on the black market and the country's total debt, now about $160 billion, has increased five-fold under Mr Chavez.

"It's a perfect example to the rest of the world on how not to run an economy," said one Caracas capital market broker.

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 Philip Sherwell is The US Editor of The Sunday Telegraph. Petroleumworld does not necessarily share these views.

Editor's NoteThis commentary was originally published on The Sunday Telegraph, on Jan. 5, 2012. Petroleumworld reprint this article in the interest of our readers.

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Petroleumworld News 01/13/2013


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