Chavez Set to Be Granted Sweeping New Powers

Venezuela's president, Hugo Chavez, was today poised to gain extended powers allowing him to make sweeping changes as he seeks to transform Venezuelan society.

MPs were scheduled to formally grant Mr Chavez the authority to enact measures by presidential decree during an outdoor meeting at the Plaza Bolivar, next to the national assembly in Caracas.

The former paratroop commander has already said he will use the law to nationalise Venezuela's largest telecommunications company and the electricity sector.

He also intends to slap new taxes on the rich and impose greater state control over oil and natural gas.

Mr Chavez plans to give "power to the people" through thousands of newly formed communal councils, in which Venezuelans will have a say on spending on neighbourhood projects ranging from public housing to road repairs.

The president, who is beginning a fresh six-year term, says the legislation will be the start of a new era of "maximum revolution" during which he will consolidate Venezuela's transformation into a socialist society.

The national assembly president, Cilia Flores, said the special powers would enable Mr Chavez to enact new laws that "will benefit the people, those who were excluded their whole lives. They are laws for inclusion and social justice".

Mr Chavez's critics, however, see his new powers as a dangerous step towards authoritarianism.

John Negroponte, who is set to become the second in command at the US state department, yesterday said Mr Chavez was exporting a form of "radical populism" that poses a threat to democracy.

US officials have voiced concern over nationalisation plans that have targeted companies such as CANTV, the dominant provider of fixed-line telephone services, and the utility firm Electricidad de Caracas, both of which have US stakeholders.

Mr Chavez has requested special powers twice before. In 1999, shortly after he was first elected, he was only able to push through two new taxes and a revision of the income tax law after overcoming fierce opposition in congress.

In 2001, by invoking an "enabling law" for the second time, he decreed 49 laws, including controversial agrarian reform measures and a law that sharply raised taxes on foreign oil companies operating in Venezuela.

This time, the law will give Mr Chavez a free hand to bring some oil and natural gas projects still run by private companies under state control.

Venezuela is an important oil supplier to the US, and is home to Latin America's largest gas reserves.

Mr Chavez has said oil companies such as British Petroleum, Exxon Mobil and Chevron must submit to state-controlled joint ventures.