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Stunned Cuba ponders future without Chavez

Posted: 05 Mar 2013 07:54 PM PST

HAVANA (Reuters) - A mix of sorrow, self-interest and dread took hold of Cuba Tuesday evening as word spread like wildfire that Venezuelan President Hugo Chavez, who had done so much for the country, was dead.

Supporters of Venezuela's President Hugo Chavez show pictures of him as they react to the announcement of his death outside the Venezuelan Embassy in Buenos Aires, March 5, 2013. Chavez died on Tuesday after a two-year battle with cancer, ending 14 years of divisive rule. REUTERS/Marcos Brindicci

Supporters of Venezuela's President Hugo Chavez show pictures of him as they react to the announcement of his death outside the Venezuelan Embassy in Buenos Aires, March 5, 2013. Chavez died on Tuesday after a two-year battle with cancer, ending 14 years of divisive rule. REUTERS/Marcos Brindicci

While the official evening newscast devoted its entire program to events unfolding in Caracas, the government reaction was slow in coming.

Later in the evening Cuba declared three days of mourning, and eulogized Chavez saying his "Bolivarian Revolution" was "irreversible" and that Cuba would continue to "accompany Venezuelans in their struggles."

Chavez's resolute ideological embrace of Cuba helped propel the once isolated communist island back into the centre of regional politics, and oil-rich Venezuela's largesse under Chavez proved a life saver for the embargoed and near bankrupt Caribbean island after the collapse of its long-time benefactor, the Soviet Union.

Even so, analysts do not expect Chavez's death to have any short-term impact for Cuba.

"I'm sure the Cubans are concerned, but I don't think this will be a game changer for the Cubans. They have weathered worse storms before," said Frank Mora, former deputy assistant secretary of defence for Western Hemisphere Affairs in the first Obama administration.

Chavez is viewed in Cuba as an irreplaceable leader of the region and saviour of socialism, portrayed day and night by official media as a champion of regional unity, independence and the island.

During his two-year battle with cancer, Chavez had four operations in Cuba and spent months receiving treatment on the island.

"Once again the horizon for all of Latin America has grown dark," Havana snack vendor, Eric Rodriguez, said.

"I only hope Venezuela can support this blow, but the road ahead for them won't be easy, nor for Cuba," he said.

There were tears for the 58-year-old Venezuelan and his family over the tragedy of succumbing to cancer. Then there were the calculations over what events in Caracas might mean for daily life on the Communist-run island, so dependent on the preferential trade relations under Chavez.

There was dread that Cuba would once more lose a strategic ally and be plunged back into a grave economic crisis similar to the scarcity in the 1990s that followed the demise of the Soviet Union.

Soon after Chavez won his first election in 1998, Fidel Castro anointed the young and vitriolic firebrand as his revolutionary successor in Latin America.

President Raul Castro, who replaced his ailing brother in 2008, has strengthened relations with Venezuela even as he forged closer ties with other oil-producing nations such as Brazil, Angola, Algeria and Russia.

ECONOMIC DEPENDENCE

Most Cuban economists point out that the economy has become more diversified over the last 20 years with the development of tourism, pharmaceuticals and increased oil and nickel production. But they say it remains far too dependent on Venezuela.

Cuba and Venezuela have formed more than 30 joint ventures over the years, most of them based in Venezuela.

They range from a fishing fleet, to port and rail repair, to hotels, agriculture, nickel and steel production and just about all of Cuba's downstream oil industry.

In 2011, Venezuela accounted for $8.3 billion of Cuba's $20 billion in foreign trade. It pays Cuba an estimated $6 billion or more annually for the services of 40,000 doctors, nurses and other professionals, local economists say. That is around 60 percent of the foreign exchange Cuba earned from services.

Venezuelan banks provide soft credits for dozens of development projects across the island.

Venezuela serves as a guarantor for investment and trade with the island.

While many Cubans fretted, others were more optimistic that Chavez's hand-picked successor, Vice President Nicolas Maduro, would win the election that must now take place within 30 days.

UNCERTAINTY AND REFORM

Cuba is in the process of lifting some restrictions on civil liberties and revamping the state-dominated economy into a more mixed and market friendly one.

Experts said that regardless of the election's outcome the pace and depth of reform would most likely pick up.

An opposition victory, viewed as unlikely, would certainly force Havana to scamper, they said, and while a Maduro win would spell no changes for Cuba in the short term, the threat of instability in Venezuela's future would loom large on local leaders' minds.

"Assuming that Maduro is elected, Venezuela will continue its critical oil subsidies, but both international credit markets and the Cuban leadership can now more clearly see a future where Cuba will have to bolster its energy self-sufficiency and improve its credit ratings," said Carlos Saladrigas, head of the Cuba Study Group, a Cuban American business organization that advocates engagement with Havana.

"The pro-reform factions within the Cuban system will have additional arguments in their quiver for moving forward with all deliberate speed," he said.

Mora agreed that mid-term instability in Venezuela would be Cuba's biggest challenge.

"I think everyone will try and unite behind Maduro. It's what becomes of Venezuela after, and whether Maduro can keep all the disparate factions within Chavismo together for a long period of time, especially if the Venezuelan economy runs into macro-economic troubles and it's not able to continue subsidizing political support (for Cuba)," he said.


Related Stories:
In Miami, Venezuelans optimistic after death of Chavez

Copyright © 2013 Reuters

Venezuela's Hugo Chavez dies from cancer

Posted: 05 Mar 2013 07:48 PM PST

CARACAS (Reuters) - President Hugo Chavez died on Tuesday after a two-year battle with cancer, ending 14 years of tumultuous and divisive rule that won him passionate support among the poor but hatred from business leaders and wealthy Venezuelans.

Peru's supporters of Venezuelan President Hugo Chavez write messages in a book of condolences inside Venezuela's embassy in Lima after the announcement of his death, March 5, 2013. Chavez died on Tuesday after a two-year battle with cancer, ending 14 years of divisive rule. REUTERS/Enrique Castro-Mendivil

Peru's supporters of Venezuelan President Hugo Chavez write messages in a book of condolences inside Venezuela's embassy in Lima after the announcement of his death, March 5, 2013. Chavez died on Tuesday after a two-year battle with cancer, ending 14 years of divisive rule. REUTERS/Enrique Castro-Mendivil

The flamboyant 58-year-old had undergone four operations in Cuba for a cancer that was first detected in his pelvic region in mid-2011. He vanished from public view after December 11 surgery that resulted in complications and respiratory infections.

"It's a moment of deep pain," said Vice President Nicolas Maduro, choking up during a national address. "Commander, thank you so much, on behalf of these people whom you protected."

Military chiefs quickly pledged loyalty to Maduro, who will be caretaker leader until elections are called within 30 days. Weeping Chavez supporters poured onto the streets, chanting "Chavez lives! The revolution continues!" and "We are Chavez!"

"Don't let anyone try to convince you Chavez has gone ... He will always be with us," said Congress head Diosdado Cabello.

The president's death was announced by Maduro, flanked by cabinet ministers, less than an hour after he passed away.

State TV broadcast Chavez's emotional last speech from December, shops in Caracas locked up for fear of looting, and condolences came from around the world, including messages from filmmaker Oliver Stone and U.N. Secretary General Ban Ki-moon.

Tensions ran high in some areas. Colombia's RCN TV showed one of its reporters bleeding from a head wound after she was apparently beaten by Chavez supporters outside the military hospital.

Chavez easily won a new six-year term at an election in October and his death is devastating for millions of supporters who adored his charismatic style, anti-U.S. rhetoric and oil-financed policies that brought subsidized food and free health clinics to long-neglected slums.

Detractors, however, saw his one-man style, gleeful nationalizations and often harsh treatment of opponents as traits of an egotistical dictator whose misplaced statist economics wasted a historic bonanza of oil revenues.

Chavez's corpse will lie in state at a Caracas military academy until a formal funeral ceremony on Friday, and seven days of mourning will be observed, officials said.

"The funeral of Chavez is going to rival Eva Peron's in Argentina," said Daniel Hellinger, a Venezuela expert in the United States, referring to the beloved former first lady of Argentina who died at the height of her popularity in 1952.

MADURO FAVORITE TO WIN ELECTION

Chavez's death opens the way for a new election that will test whether his socialist "revolution" can live on without his dominant personality at the helm.

The new vote will likely pit Maduro against Henrique Capriles, the centrist opposition leader and state governor who lost to Chavez in October. Maduro appealed for calm and respect for democracy.

One recent opinion poll gave Maduro a strong lead because he is Chavez's preferred successor, enjoys support among many of the working class and could benefit from an inevitable surge of emotion in the coming days.

Maduro has been a close ally of Chavez for years and would be very unlikely to make significant changes to the late president's socialist policies, although he could at some point try to ease tensions with investors and the U.S. government.

Just hours before Chavez's death, though, Maduro alleged that "imperialist" conspirators had infected the president with cancer among a plethora of conspiracies with domestic opponents. The government never said what type of cancer Chavez had, but experts suspect it was a soft-tissue sarcoma.

A victory by Capriles would bring in much deeper changes and would be welcomed by business groups and foreign investors, although he would probably move cautiously in order to lower the risk of political instability and violence.

Venezuela has the world's largest oil reserves and some of the most heavily traded bonds, so investors will be highly sensitive to any signs of turmoil.

U.S. President Barack Obama said his government was interested in starting a new relationship with Venezuela.

"At this challenging time ... the United States reaffirms its support for the Venezuelan people and its interest in developing a constructive relationship with the Venezuelan government," Obama said in a statement.

An opposition election win would move Venezuela closer to the United States and upend alliances with Latin American states that have relied on Chavez's oil-funded largesse - most notably communist-led Cuba, which recovered from financial ruin in the 1990s largely thanks to Venezuelan aid.

Chavez was a garrulous figurehead for a global "anti-imperialist" alliance stretching as far as Belarus and Iran, and will be sorely missed by anti-U.S. agitators.

After the cancer was diagnosed in June 2011, Chavez went through several cycles of disappearing from the public eye for weeks at a time for treatment in Havana, only to return just as his adversaries were predicting his demise.

His health weakened severely just after his re-election on October 7, possibly due to his decision to campaign for a third term instead of stepping aside to focus on his recovery.

HUMBLE ROOTS

Chavez was raised by his grandmother in a house with a mud floor in rural Venezuela and evoked almost religious passion among poor supporters who loved his folksy charm, common touch and determination to put the country's oil wealth at their service.

He burst onto the national scene by leading an attempted coup in 1992. It failed and he was imprisoned, but he then formed a political party on his release two years later and swept to power in a 1998 election.

It was the first of four presidential election victories, built on widespread support among the poor.

But Chavez alienated investors with waves of takeovers and strict currency controls, often bullied his rivals, and disappointed some followers who say he focused too much on ideological issues at the expense of day-to-day problems such power cuts, high inflation and crime.

Chavez built a highly centralized political system around his larger-than-life image and his tireless, micro-managing style created something close to a personality cult. He was particularly adept at exploiting divisions within a fractious opposition.

Chavez was briefly toppled in a coup in 2002, but returned triumphantly after his supporters took to the streets.

Apparently realizing the end was nigh, Chavez named Maduro his successor in December, just before his fourth operation, which followed months of chemotherapy and radiation treatment.

MADURO'S PROSPECTS

On February 18, Chavez made a surprise pre-dawn return from Cuba and was taken to a ninth-floor suite of a military hospital in Caracas, surrounded by tight security.

The government published a handful of pictures of Chavez lying in a hospital bed while he was still in Havana - the only time he was seen since the latest surgery. Supporters had held tearful vigils around the country to pray for his recovery.

Maduro, 50, will now focus on marshalling support from Chavez's diverse coalition, which includes leftist ideologues, businessmen, and radical armed groups called "colectivos".

Seeking to knock down rumours of tensions at the top of the ruling Socialist Party (PSUV), Maduro has stressed the unity between him and Cabello, a powerful former army buddy of Chavez who heads the National Assembly.

Maduro is a former bus driver who rose from union activist to foreign minister and then to president-in-waiting. He won Chavez's confidence by meticulously echoing his vitriolic rhetoric and never airing a dissenting opinion.

Maduro has mimicked Chavez's rabble-rousing style in recent weeks, peppering speeches with insults aimed at adversaries.

Capriles, Maduro's likely opponent, is a 40-year-old governor of Miranda state who led a hard-fought campaign against Chavez in the October election.

There are clear ideological differences between the 20 or so groups in the opposition's Democratic Unity coalition and without their enmity to Chavez to bind them, the alliance could splinter.

Until recently, polls had shown Capriles would beat any of Chavez's protégés. But the naming of Maduro as Chavez's heir, and the outpouring of emotion that will accompany Chavez's death, have changed the picture.

A survey carried out by local pollster Hinterlaces between January 30 and February 9 gave Maduro 50-percent support, compared to 36 percent for Capriles.

(Additional reporting by Reuters reporters across Latin America, Editing by Terry Wade, Kieran Murray and David Brunnstrom)


Related Stories:
Despite new hopes, U.S. treads cautiously after death of Venezuela's Chavez

Venezuelans to vote in 30 days, Maduro assumes power for now
Reaction to the death of Venezuelan President Hugo Chavez
Devastated, mourning Chavez supporters pour onto streets
PDVSA says Venezuela oil industry normal after Chavez death
Factbox - Venezuela's likely election candidates after Chavez's death
Chronology - Hugo Chavez's losing battle against cancer
Factbox - Venezuelan President Hugo Chavez
Factbox - Quotes from Venezuelan leader Hugo Chavez
Factbox - Reaction to the death of Venezuelan President Hugo Chavez

Copyright © 2013 Reuters

U.S. to allow small knives to be carried onto airplanes

Posted: 05 Mar 2013 06:06 PM PST

WASHINGTON (Reuters) - The U.S. Transportation Security Administration said on Tuesday that travellers can soon bring small pocket knives on board airplanes for the first time since the September 11 attacks, sparking outrage from flight attendants who said the decision would endanger passengers and crew.

Knives, scissors and other prohibited items that were confiscated at the airport during security checks by Transportation Security Administration screeners are on display prior to a news conference at Los Angeles International Airport in this August 29, 2003 file photograph. The Transportation Security Administration said on March 5, 2013 that travelers can soon bring small pocket knives on board airplanes for the first time since the September 11 attacks, sparking outrage from flight attendants who said the decision would endanger passengers and crew. REUTERS/Fred Prouser/Files

Knives, scissors and other prohibited items that were confiscated at the airport during security checks by Transportation Security Administration screeners are on display prior to a news conference at Los Angeles International Airport in this August 29, 2003 file photograph. The Transportation Security Administration said on March 5, 2013 that travelers can soon bring small pocket knives on board airplanes for the first time since the September 11 attacks, sparking outrage from flight attendants who said the decision would endanger passengers and crew. REUTERS/Fred Prouser/Files

The TSA said that effective April 25, it would allow knives with blades that are 2.36 inches (6 cm) or less in length and less than 1/2 inch (1-1/4 cm) wide. Other items that will be allowed on board again as part of a passenger's carry-on luggage include billiard cues, ski poles, hockey sticks and lacrosse sticks.

Items that had been prohibited like razors, box cutters or knives with a fixed blade are still not allowed on board.

TSA spokesman David Castelveter said the decision was made to bring U.S. regulations more in line with International Civil Aviation Organization standards and would also help provide a better experience for travellers.

"This is part of an overall Risk-Based Security approach, which allows Transportation Security officers to better focus their efforts on finding higher-threat items such as explosives," he said.

The Flight Attendants Union Coalition, which represents nearly 90,000 flight attendants from carriers across the country, called it a "poor and shortsighted decision" by the TSA.

"As the last line of defence in the cabin and key aviation partners, we believe that these proposed changes will further endanger the lives of all flight attendants and the passengers we work so hard to keep safe and secure," the coalition said in a statement.

Castelveter said the TSA had implemented a number of safety measures, including reinforced cockpit doors, allowing some pilots to be armed and federal air marshals on board airplanes. He said those measures would help ensure safety of the passengers and crew.

At Ronald Reagan Washington National Airport in Washington, travellers reacted to the change with alarm.

"I would say, what were you thinking? Because it's ludicrous to think of allowing knives on a plane," said Deborah Debare. "They are as dangerous as guns."

Another traveller, David Veeder, said that when it came to knives and blades, even small instruments could pose a danger.

"I'd prefer they had nothing," he said.

After the September 11, 2001 hijacked airliner attacks on New York and Washington, the U.S. government imposed strict rules for what could be carried on board an aircraft, some of which differed from what other countries allowed.

(Additional reporting by Pavithra George; Editing by Edith Honan and David Brunnstrom)

Copyright © 2013 Reuters

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