Oct. 4 (Bloomberg) -- In 14 years, Venezuelan President Hugo Chavez has survived a coup, seized 1,000 companies, forged ties with Iran and called George W. Bush the “devil.” Not even cancer has hobbled him enough to stop his fourth bid for office.
Following three surgeries in Cuba that had slowed his campaign against Henrique Capriles Radonski, the 58-year-old Chavez picked up the pace in the past two weeks, visiting seven states that cover about one-third of the country. He ends his campaign for the Oct. 7 election with a rally today in Caracas.
Even as cancer has become less of an issue for voters, concerns persist that Chavez’s health won’t hold out for another six years in office and a succession fight will break out, said Moises Naim, a former Venezuelan trade minister now at the Carnegie Endowment for International Peace in Washington.
“There are several factions that have leaders in the government that feel both the right and duty to be the successor,” said Naim, who also sat on the board of directors of the central bank from 1989 to 1990. “Chavez knows if he picks one the others will revolt.”
Investors boosted demand for Venezuelan debt earlier this year as Chavez struggled with his cancer treatment, said Alfredo Viegas, managing director for emerging markets at Knight Capital in Greenwich, Connecticut. The country’s dollar bonds have returned 30 percent this year through September, the second-highest in emerging markets after the Ivory Coast, according to JPMorgan Chase & Co.’s EMBIG index.
Youth and Fitness
Chavez isn’t guaranteed a victory as he faces his closest campaign battle since entering office. Capriles, the 40-year-old former governor of Miranda state, has stressed his youth and fitness as a contrast to the ailing Chavez, visiting more than 260 communities over eight months and rallying tens of thousands in Caracas Sept. 30.
“In the past Chavez was constantly in the streets and doing what we’re seeing Capriles do now, which is visit several states in the same day,” said Andres Canizalez, a media professor at Universidad Catolica Andres Bello in Caracas. “That was Chavez in 2006.”
Polls have varied widely, though most analysts give the advantage to Chavez, who tried to make up for his lack of public campaigning by requiring that television and radio stations cover his official speeches, even when Capriles is already speaking.
Bank of America Merrill Lynch in an Oct. 1 report gave Chavez an advantage of 12.2 percentage points in the election, basing the estimate on surveys conducted by seven polling companies. In a Sept. 7-18 survey of 1,500 people by Caracas-based Consultores 21, the two candidates were in a statistical tie, with Capriles supported by 46.5 percent and Chavez by 45.7 percent. The poll had a margin of error of 2.58 percentage points.
Under Venezuelan law, if Chavez wins and becomes too ill to serve during the first four years of his term, the vice president assumes the presidency for 30 days while elections are held. If he can’t serve the final two years, the vice president can finish out the term.
While political analysts say the president of the national assembly, Diosdado Cabello, and Foreign Affairs Minister Nicolas Maduro are potential replacements, there’s no known line of succession for the man who has dominated Venezuelan politics since 1998. Chavez has dismissed the need for a succession plan since he claims to be free of cancer.
“To think of the country without Chavez at this time is to think of another country,” Alberto Barrera, the Venezuelan co-author of the Spanish-language biography “Hugo Chavez Out of Uniform,” said in an e-mailed response to questions. “He has developed an immense cult of personality. He clearly dominates society.”
Since taking office with 56 percent of the vote in the 1998 election, Chavez has rewritten the constitution, fired 18,000 striking oil workers at state-run Petroleos de Venezuela SA, shut down the country’s most popular television station, seized brokerages and railed against the U.S. “empire,” which he charged with backing an unsuccessful 2002 coup.
His penchant for needling the U.S., the biggest buyer of Venezuelan crude, has included accusing the American ambassador of spying, hosting Russian warships and praising Iranian President Mahmoud Ahmadinejad. In a 2006 speech at the United Nations, one day after Bush’s visit, Chavez said the lectern smelled of sulfur.
“Yesterday, ladies and gentleman, from this rostrum, the president of the United States, the gentleman whom I refer to as the devil, came here, talking as if he owned the world,” Chavez said.
Domestically, Chavez has portrayed himself as a man of action, bantering with everyone from shop keepers and steelworkers to housewives and farmers for as long as six hours straight on his weekly “Alo Presidente” television show before the cancer struck.
When companies haven’t met Chavez’s own standards for investment or low prices, he seized them, sometimes in mid-stride during walks through the capital. That was the fate for the local units of Exxon Mobil Corp., Banco Santander SA and Owens-Illinois Inc., the world’s largest producer of glass containers.
The takeovers have cost the government $12.7 billion in compensation to date with $13.5 billion pending, according to Caracas-based research company Ecoanalitica.
Surging oil revenue aided Chavez’s takeovers and fueled programs targeting the poor, including subsidized food and free medical clinics. Crude has climbed from about $11 a barrel when Chavez was elected to $88 yesterday. Venezuela has the world’s largest reserves of oil, totaling about 300 billion barrels, according to the BP Statistical Review of World Energy.
Boosted by election-year spending, Venezuela’s economy will expand 5 percent in 2012, according to the median estimate of analysts polled by Bloomberg. Under Chavez, Venezuela has the region’s lowest level of inequality, according to the United Nations, and the fourth-highest per-capita GDP, according to data compiled by Bloomberg.
Still, Venezuela’s 18 percent inflation rate is the world’s fastest after Belarus, Iran and Argentina. It has the highest borrowing costs among major emerging markets, according to JPMorgan. Crime has soared since Chavez came to power, with the homicide rate tripling last year to 67 per 100,000 inhabitants, the highest in South America, according to the Venezuelan Violence Observatory. The government says the rate is lower, without providing official figures.
‘I’ve Never Failed You’
Chavez has acknowledged short-comings and vowed to be “more efficient” and to eliminate poverty in a third six-year term.
“I’m committed to being a better president starting on Oct. 8,” he told supporters at an Oct. 2 rally in Lara state. “Although I’ve committed mistakes, I’ve never failed you.”
Even as billboards and street art portray the president as omnipresent, Chavez’s illness has taken its toll. The leader once known for giving six-hour speeches spoke for an average of just 24 minutes a day in late September, Barclays Plc wrote in a Sept. 26 report, citing Venezuelan research group ODH.
Yet the president has been back to his old antics at times in the past two weeks, singing and dancing with musicians during campaign stops, while playfully boxing with young athletes at rallies.
Chavez supporters wearing red shirts packed downtown Caracas in the rain today, filling four broad avenues, before the president was scheduled to appear. Buses carrying supporters choked the capital’s streets while motorcycles decorated with red flags wove in and out of traffic as they headed to the rally.
“We’re in the midst of the final avalanche of people on our way to a knock-out victory on Sunday,” Chavez said on state television Oct. 2.
Without more details on his cancer, it’s impossible to determine the severity of Chavez’s illness, Sunil Daryanani, a Caracas-based oncologist, said by phone. His erratic campaign style may simply show that a year’s worth of treatment is taking a physical toll, he said.
Even if Chavez is forced to step aside after winning, his influence is unlikely to fade anytime soon, said former Brazilian Foreign Minister Luiz Felipe Lampreia, who oversaw ties with Venezuela when Chavez took office in 1999.
“Chavez’s policies are so implanted that it’ll take one or two generations to roll them back,” he said.
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