Morales Chavez resist EU pressure

Morales, Chavez resist EU pressure

VIENNA, Austria (Reuters) -- The leftist presidents of Venezuela and
Bolivia resisted calls by European and fellow Latin American leaders on
Friday to soften their hard-line policies on foreign investment, energy
and trade.

Venezuela's Hugo Chavez and his new ally Evo Morales of Bolivia, both
running countries with increasingly important energy supplies, dominated
the summit of about 60 heads of state which should have focused on new
trade and investment deals.

Chavez, a combative former paratrooper, condemned the pro-market
policies many Latin American countries have adopted in the last 20 years
but which have fallen out of favor with many voters for failing to make
a big impact on poverty.

"Neoliberalism has begun its decline and has come to an end," Chavez
told reporters. "Now a new era has begun in Latin America. Some call it
populism, trying to disfigure our beauty. But it is the ... voice of the
people that is being heard."

European Commission President Jose Manuel Barroso declined to talk about
specific states but said populism was a threat. "We are a Europe against
populist tendencies," he said.

Bolivia and Venezuela have increasingly riled governments on both sides
of the Atlantic.

Morales nationalized Bolivia's oil and gas sector on May 1, shortly
after taking power, and has promised further tough action with foreign
investors.

Venezuela has angered the United States by allying himself with Cuba's
Communist government and worried Europeans too by extending state
control further over the oil industry.

British Prime Minister Tony Blair urged the two countries not to act
irresponsibly.

"What countries do in their energy policy when they are energy producers
like Bolivia and Venezuela matters enormously to all of us," he told
reporters. "My only plea is that people exercise the power they have got
in this regard responsibly for the whole of the international community."

United Nations Secretary General Kofi Annan said investors needed to be
sure of long-term stability: "Without that assurance you may be
disrupting all economic activities."

But Chavez did not seem under pressure, joking instead with reporters
about a scantily clad Argentine carnival queen who burst past police to
protest about a planned pulp mill in Uruguay, another cross-border row
in Latin America.

"It was one of the best things that have happened at this summit," said
Chavez as the woman was ejected by police.

The summit was planned as a chance to take ties between the EU and
several regions of Latin America to a new level.

But with several Latin American nations mired in disputes, only a deal
for the launch of trade, investment and aid talks between the EU and
Central American countries was planned.

Peru was demanding a timetable for similar negotiations with the Andean
countries but Brussels could not do that because Bolivia will not commit
itself to the talks, officials said.

Venezuela recently quit the Andean Community in protest at trade deals
planned by neighboring countries with the United States, whose influence
Chavez is challenging.

Morales, a former coca farmer making his first presidential trip to
Europe, has relished the chance to confront his country's former
colonial powers and Bolivia's present heavyweight neighbor Brazil for
"pillaging" his country.

Brazil on Thursday reacted angrily to comments by Morales that
state-controlled oil company Petrobras had acted illegally in Bolivia.

Brazilian Foreign Minister Celso Amorim said on Friday a dispute over
compensation for Petrobras as a result of Bolivia's energy
nationalization could end up being resolved in court.

Spain is also concerned about potential losses for Spanish energy group
Repsol, which is the second-biggest foreign investor in Bolivia's energy
sector after Petrobras.

http://www.cnn.com/2006/BUSINESS/05/12/bolivia.venezuela.reut/index.html?section=cnn_latest