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Venezuela Takes More Steps Toward Socialist State

President Hugo Chavez has promised to nationalize Venezuela's telecommunications and energy industries as part of a "socialist revolution." Analysts discuss the country's leftist politics and Chavez's role in promoting anti-U.S. ideology in Latin America.

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    Venezuelan President Hugo Chavez hosted a warm welcome Saturday for a high-profile visitor: Iranian president and U.S. nemesis Mahmoud Ahmadinejad.

    The two leaders, both known for their fiery anti-American rhetoric, reaffirmed their anti-U.S. bond. They said their previously announced $2 billion joint investment fund would be used to help developing countries that, as Chavez put it, "are trying to liberate themselves from the U.S. imperialist yoke."

    Venezuela and Iran share a powerful source of leverage: oil. Iran is the world's fourth-largest oil exporter, and Venezuela the fifth. On Saturday, Chavez said they would push OPEC, the Organization of Petroleum Exporting Countries, to cut production quotas to boost oil prices back up to recent record levels.

    HUGO CHAVEZ, President of Venezuela (through translator): One of the imperialist strategies is to weaken OPEC, weaken the oil price. That is why we agree this afternoon to strengthen efforts both inside and outside OPEC, with the big oil producers, to protect the price of our raw material.


    Ahmadinejad went on to visit two other recently elected leftists in the region in Nicaragua and Ecuador.

    Latin America has seen a leftward political shift in the past year. In addition to Chavez's comfortable reelection victory in December, leftist economist Rafael Correa won Ecuador's recent election. He was inaugurated today.

    Former Sandinista leader Daniel Ortega assumed the presidency of Nicaragua earlier this month. Bolivia elected a populist, leftist president, Evo Morales, 13 months ago. And Brazil recently reelected its populist president, Inacio Lula da Silva, by a big margin.

    Chavez has gone the furthest towards trying to claim the mantle of Cuba's ailing Fidel Castro. In a bravado-tinged swearing-in last week, Chavez vowed to speed up Venezuela's transformation to a socialist model.

  • HUGO CHAVEZ (through translator):

    I swear by my people and my country that I will not rest my arm or my soul as we build a new political system, a new social system, a new economic system. I swear by Christ, the greatest socialist in history.


    Specifically, Chavez vowed to: nationalize the country's largest electric and telephone companies — both are owned, in good part, by U.S. companies and investors; take control of four multibillion-dollar oil development projects being pursued by U.S. and other foreign oil companies; and strip the country's central bank of its independence.

    His nationalization announcement triggered a hefty devaluation of Venezuela's currency on the black market. The Venezuelan Stock Exchange also plummeted nearly 20 percent, but did recover some of that loss in subsequent days.