The Jim Bakker Show

China confident Venezuela can handle debt issue

BEIJING (Reuters) – China’s Foreign Ministry reiterated on Thursday that it believes Venezuela has the ability to handle its debt issue, after the oil-rich country started making interest payments on bonds following a delay that had threatened to trigger a default.

Venezuela has borrowed billions of dollars from Russia and China, primarily through oil-for-loan deals that have crimped the country’s hard currency revenue by requiring oil shipments to be used to service those loans.

On Wednesday, Venezuela won easier debt terms from Russia, as well as a vote of confidence from China – two countries that could provide a lifeline as Caracas seeks to keep its deeply depressed economy solvent.

Asked whether China was concerned that the debt would not be repaid, Chinese Foreign Ministry spokesman Geng Shuang told a regular news briefing that China-Venezuela financial cooperation was proceeding as normal.

“We believe that Venezuela’s government and people have the ability to properly handle their debt issue,” Geng said.

Venezuelan bond prices have been on a roller-coaster over the past 10 days, as President Nicolas Maduro called investors to debt restructuring talks, while pledging to keep honoring the country’s obligations.

But S&P Global Ratings declared it in selective default on two of its sovereign bonds early this week after it failed to make the coupons within a 30-day grace period.

On Wednesday, the country’s Economy Ministry said it had started transferring $200 million in interest payments on those bonds, which mature in 2019 and 2024.

(Reporting by Ben Blanchard, Writing by Michael Martina; Editing by Richard Borsuk)

Venezuela offers chocolates but little else to creditors

By Deisy Buitrago and Brian Ellsworth

CARACAS (Reuters) – Venezuela’s socialist government gifted chocolates to creditors on Monday, but offered no firm proposals at a brief meeting in Caracas that left investors without a clear understanding of the government’s strategy to renegotiate $60 billion in debt.

President Nicolas Maduro confused investors this month with a vow to continue paying Venezuela’s crippling debt, while also seeking to restructure and refinance it.

Both restructuring and refinancing appear out of the question, however, due to U.S. sanctions against the crisis-stricken nation. A default would compound Venezuela’s dire economic crisis.

Monday’s short and confused meeting, attended by senior Venezuelan officials blacklisted by the United States, gave no clarity on how Maduro would carry out his plan, bondholders and their representatives who participated said afterwards.

That means Venezuela remains with the dilemma of whether to continuing paying debt at the expense of an increasingly hungry and sick population, or defaulting on creditors and burning its bridges to the global financial system.

“There was no offer, no terms, no strategy, nothing,” said one bondholder, leaving the meeting that lasted a little over half an hour at the ‘White Palace’, departing with a colorful gift-bag containing Venezuelan chocolates and coffee.

But bond prices maintained last week’s rally, with one investor saying there was relief the meeting did not include a default announcement.

Nearly $300 million in late interest payments on three bonds – PDVSA 2027, Venezuela 2019 and Venezuela 2024 – was also due on Monday after 30-day grace periods ended. But bondholders appeared unconcerned at the delay, which was due in part to increased bank vigilance of Venezuela transactions.

“My expectation is that the coupon payments will come through as well,” said Jan Dehn, Head of Research at Ashmore Investment Management. “We know that these delays exist and why they exist.”

About 100 investors, including some bondholders from New York and lawyers representing creditors, entered the ‘White Palace’ via a red carpet and were greeted by a poster of Maduro’s predecessor Hugo Chavez at the entrance of the meeting room inside.

SANCTIONS OVERSHADOW MEETING

Chief debt negotiators Vice President Tareck El Aissami and Economy Minister Simon Zerpa – on U.S. sanctions lists for drug and corruption charges respectively – attended the meeting for half an hour.

They met with some bondholders, while others stayed out of the room on concerns about penalties for dealing with officials sanctioned by Washington.

El Aissami told creditors that Deutsche Bank may soon cut off some financial services to Venezuela, participants said.

Deutsche declined to comment.

He read a statement protesting unfair treatment by global financial institutions, including U.S. President Donald Trump’s sanctions aimed at preventing Venezuela from issuing new debt.

“Now Maduro can say: ‘I showed goodwill, the bondholders showed goodwill … but unfortunately because Uncle Sam is not playing ball we can’t (refinance)’,” said Dehn, who did not attend the meeting.

“I’m not hugely surprised nothing’s come out of that meeting.”

Separately, the European Union approved economic sanctions and an arms embargo on Venezuela on Monday, although it has yet to name who will be subject to the sanctions.

Markets continue to remain optimistic that Venezuela will service its debts, noting it has made close to $2 billion in payments in the past two weeks, albeit delayed.

Bond prices were up across the board on Monday, with the benchmark 2022 notes issued by state oil firm PDVSA [PDVSA.UL] rising 3.3 percentage points.

The economic implosion has already taken a brutal toll on Venezuelans. Citizens are suffering from malnutrition and preventable diseases because they cannot find food and medicine or cannot afford them because of triple-digit inflation.

The sight of poor Venezuelans eating from garbage bags has become a powerful symbol of decay. It contrasts sharply with the era of Chavez, when high oil prices helped fuel state spending.

Halting debt service would free up an additional $1.6 billion in hard currency by the end of the year. Those resources could be used to improve supplies of staple goods as Maduro heads into a presidential election expected for 2018.

But the strategy could backfire if met with aggressive lawsuits. A default by PDVSA, which issued about half of the country’s outstanding bonds, could ensnare the company’s foreign assets such as refineries in legal battles – potentially crimping export revenue.

(For a graphic on ‘Venezuela’s economy’ click http://tmsnrt.rs/2pPJdRb)

(Additional reporting by Corina Pons in Caracas and Dion Rabouin in New York; Writing by Andrew Cawthorne; Editing by Andrew Cawthorne, Frances Kerry and Rosalba O’Brien)

Russia, China, others boycott U.S. meeting at U.N. on Venezuela

By Michelle Nichols

UNITED NATIONS (Reuters) – Russia, China, Egypt and Bolivia boycotted an informal public United Nations Security Council meeting on Venezuela on Monday organized by the United States, saying the 15-member body should not be involved in the situation.

“The issue is about meddling with the internal domestic affairs of Venezuela,” Russian U.N. Ambassador Vassily Nebenzia told reporters, adding that he hoped the country could settle its issues peacefully without any external interference.

U.S. Ambassador to the United Nations Nikki Haley told the meeting: “The fact that the (Venezuelan) government would go so far as to try and get people not to show up to a meeting is guilt. And that’s unfortunate.”

Venezuela is suffering from a harsh economic crisis and President Nicolas Maduro’s government has clamped down on the opposition, jailing or otherwise barring from office many dissenting leaders and activists.

Dozens of people have died in violence since the opposition began a sustained wave of protests in April. Met by rubber bullets, water cannon and tear gas fired by the National Guard, the protesters say the crisis demands an early presidential election that they are sure Maduro would lose.

His popularity has been pounded lower by triple-digit inflation and acute food and medicine shortages.

“We received pressure from regional partners not to have this meeting,” Haley said. “This goal is not to degrade anyone. This is not to humiliate a region. This is only to lift up the region.”

Uruguay’s Deputy U.N. Ambassador Luis Bermudez attended the U.N. meeting, but said his country did not believe the situation in Venezuela was a threat to international peace and security.

Venezuela’s U.N. Ambassador Rafael Dario Ramirez spoke to reporters as the meeting was being held, flanked by Nebenzia, Chinese Deputy U.N. Ambassador Wu Haitao and Bolivian U.N. Ambassador Sacha Sergio Llorentty Soliz.

“The meeting is a hostile and clearly interfering act of the United States that undermines the principle of sovereignty of a member state of the U.N.,” Ramirez said. “We condemn this act of political manipulation.”

European Union foreign ministers approved economic sanctions, including an arms embargo, on Venezuela on Monday, saying regional elections last month marred by reported irregularities had deepened the country’s crisis.

The United States has also imposed targeted sanctions on top Venezuelan officials.

The U.N. Security Council also met behind closed doors in May, at Washington’s request, to discuss the crisis in Venezuela.

(Reporting by Michelle Nichols; Editing by James Dalgleish)

Unversed in debt details, Venezuelans desperate for any relief

People line up to pay for their fruits and vegetables at a street market in Caracas, Venezuela November 3, 2017.

By Alexandra Ulmer and Andrew Cawthorne

CARACAS (Reuters) – Venezuelans heaving under an unprecedented economic meltdown know little about the finer points of foreign debt negotiations, but long for anything that would put more food on their plate and slow the world’s highest inflation.

Few on the streets of capital Caracas really understood unpopular leftist President Nicolas Maduro’s announcement this week that he would seek to refinance the oil-rich nation’s heavy bond burden of $60 billion – or about $2,000 per person.

But those interviewed by Reuters said they were hoping any deals between the government and its multiple foreign creditors would free up foreign currency to increase imports of scarce food, medicine, and basic products.

“Maybe it will work, and improve the country,” said Johny Vargas, 53, a construction worker who says he often only eats twice a day because his salary is gobbled up by price increases.

“Everything is so expensive. There’s no food, nothing. Maduro’s useless. Look at the bad state we’re in.”

Up to now, Venezuela’s ruling Socialist Party has prioritized debt payments by slashing imports, compounding four years of recession and shortages on the shelves.

Should a debt renegotiation be reached, it could free more money in the short-term for the government to bring in basic foods and medicines.

But Wall Street is skeptical, and so are many Venezuelans.

“We can’t have strong negotiations. We don’t have the credibility to sit down and make requests,” said 35 year-old accountant Mayerling Delgado, referring to Venezuela’s increasingly fraught relations with many other countries.

“So we have to pay,” she added in a resigned tone, in a busy Caracas plaza.

Experts have long warned that debt accrued under late leader Hugo Chavez was unsustainable, and urged Maduro’s government to refinance its debt load.

But pursuing such an operation now is near impossible given Venezuela’s economic mess, a dearth of technocrats in the government, and, especially, sanctions that bar U.S. banks from participating in or negotiating new Venezuelan debt deals.

NOT PAYING IS WORSE?

Most Venezuelans balk at the idea of a default, which would trigger lawsuits by creditors seeking to seize assets such as refineries in the United States. That could plunge the OPEC nation of 30 million people into even worse hardship.

“The majority of the population has consistently perceived a default as a negative move that could hurt the country’s economy,” said economist Luis Vicente Leon of pollster Datanalisis.

But with many analysts viewing a default as ultimately unavoidable given the parlous state of Venezuela’s coffers, some said it might be better to bite the bullet.

“What’s the science behind paying when you’ve already lost? It’s not what we as Venezuelans want … but there’s no other way out, unfortunately,” said beautician Harlee Tovitto, 42. She plans to emigrate to neighboring Colombia soon because she can no longer afford clothes or insurance for her three children.

Amid a deepening spat with U.S. President Donald Trump’s administration, some Venezuelans think Caracas would find a way out of its bond mess if it weren’t for the U.S. sanctions.

“If Venezuela has always paid its debt … why can’t they refinance?,” said Rafael Moreno, 30, a lawyer and former Chavez supporter who now says he does not back either the government or opposition.

(Reporting by Alexandra Ulmer and Andrew Cawthorne, Editing by Rosalba O’Brien)

Major Venezuelan opposition parties to boycott local polls

By Andreina Aponte and Andrew Cawthorne

CARACAS (Reuters) – Three of Venezuela’s largest opposition parties vowed on Monday to boycott mayoral polls later this year in protest at an election system they say is biased in favor of President Nicolas Maduro’s ruling socialists.

The multi-party Democratic Unity coalition has had a tough 2017, first failing to bring down Maduro in four months of protests that led to 125 deaths, then losing surprisingly to the Socialist Party in a gubernatorial election earlier this month.

That has left the opposition weakened and divided, and Maduro strengthened, despite growing foreign pressure on his government over alleged rights abuses and corruption, and an unprecedented economic crisis that has millions skipping food.

Three heavyweight movements in the opposition – Justice First, Popular Will and Democratic Action – announced on Monday they did not trust the government-leaning election board sufficiently to participate in the municipal polls in December.

Justice First leader Julio Borges, who also heads the opposition-led congress, said authorities cheated in the 2013 presidential election, denied Venezuelans a recall referendum last year, and rigged the Oct. 15 gubernatorial vote.

So instead of going into another “manipulated” vote, the opposition should focus on demanding reforms to the election board in anticipation of next year’s presidential poll, he said.

“The objective remains getting Nicolas Maduro out of power, and in this struggle, the world is with us,” he told reporters.

To the surprise of some, the Democratic Action party also joined the boycott. Its candidates won four governorships in October’s vote and then infuriated many opposition supporters by swearing loyalty to a pro-Maduro legislative superbody.

MADURO: ‘BALLOTS, NOT BULLETS’

Opposition supporters have been split over participating in elections this year. Some say it is the only way to show they are a majority and undermine Maduro, while a growing number argue there is no point in fighting a “dictator” via a system rigged in his favor.

They are pinning their hopes on international action, including U.S. sanctions against Maduro’s government.

Maduro, whose personal popularity has plunged since his 2013 election due to food shortages and runaway inflation, said “sabotage” and “insurrection” were being planned against the mayoral votes.

“I declare myself in battle,” the 54-year-old successor to Hugo Chavez said in a meeting with governors on Monday.

“Those who attack the election system must pay.”

Opposition leaders say the government has long been rigging elections by gross abuse of state funds in favor of socialist candidates, and dirty tricks such the last-minute moving of vote centers in opposition areas for the October ballot.

They have also presented some allegations of ballot-rigging.

However, Maduro insists Venezuela’s system is entirely trustworthy and impossible to hack. It has received international praise in the past, although it was slammed over July’s vote for the Constituent Assembly superbody.

Maduro says the street protests earlier this year were a mask for a U.S.-backed coup plot, and accuses opponents of wanting to oust him by undemocratic means.

“Venezuelans want ballots, not bullets,” said Maduro.

(Writing by Andrew Cawthorne; Editing by Alexandra Ulmer and Rosalba O’Brien)

Venezuelan anti-Maduro governor sacked, opposition in chaos

By Isaac Urrutia and Eyanir Chinea

MARACAIBO/CARACAS, Venezuela (Reuters) – The newly elected opposition governor of Venezuela’s western Zulia state was dismissed on Thursday by the pro-government local state legislature, adding to disarray among foes of the ruling socialists.

The sacking of Juan Pablo Guanipa, one of five opposition governors in Venezuela’s 23 states, came after he refused to swear loyalty to an all-powerful national legislative superbody aligned with President Nicolas Maduro’s ruling socialists.

“They held a secret, express session to remove him,” Guanipa’s spokeswoman Erika Gutierrez told Reuters of the morning meeting of Zulia’s state legislature.

Venezuela’s opposition Democratic Unity coalition, which groups several dozen anti-Maduro parties, has been in crisis since a surprise defeat at this month’s state elections.

Despite polls showing it would win a comfortable majority due to widespread public anger over Venezuela’s brutal economic crisis, the opposition only took five states compared to 18 for Maduro’s Socialist Party candidates.

Opposition leaders blamed dirty tricks by the government, including the last-minute moving of many vote centers in opposition areas, along with abstention by supporters disillusioned at the failure of protests earlier this year.

Driving home its advantage, the government said only governors who recognize the supremacy of the pro-Maduro Constituent Assembly could take office.

Four opposition governors did that this week, sparking recriminations and bickering within the coalition, but Guanipa said he would never “kneel before the dictatorship.”

“This is an assault on the will of the people,” he tweeted after his removal on Thursday, denouncing a “coup” in the oil-rich state on the border with Colombia.

OPPOSITION IN-FIGHTING

Prior to this week, the opposition, along with various major foreign nations including the United States, had refused to recognize the Constituent Assembly.

Elected in July after four months of anti-Maduro protests, the body has overridden the opposition-run national congress.

One major opposition leader, Henrique Capriles, said he would no longer participate in the coalition while Henry Ramos, leader of the Democratic Action party whose four governors swore themselves in before the assembly, was a member.

Capriles’ Justice First party, and the Popular Will party of detained opposition leader Leopoldo Lopez, have called for a complete reformulation of the opposition grouping.

Officials from Maduro down have been rubbing their hands in glee at the opposition implosion, and cheekily urging the controversial Ramos – a polarizing figure unpopular among young opposition militants – to stand for president in 2018.

“Backstabbing has broken out in the opposition, all against all,” crowed Maduro earlier this week.

The Constituent Assembly also announced on Thursday local mayoral elections would be held in December, giving the opposition a short time-frame to develop strategy.

Popular Will has already said it plans to boycott that vote.

Young protesters, who saw hundreds of their fellow demonstrators jailed, injured or even killed in anti-Maduro street protests earlier this year, are disgusted by what for them is now a bleak political scenario.

More than 125 people, including supporters of both sides plus security officials and bystanders, died in four months of unrest that Maduro said amounted to a U.S.-backed coup attempt.

“Let the people continue speaking loud and clear in defense of peace, sovereignty and the sacred right to self-determination,” Constituent Assembly head Delcy Rodriguez said, announcing the December municipal vote that the socialists now expect to win handily given the opposition’s disillusionment.

(Additional reporting by Andrew Cawthorne; writing by Andrew Cawthorne; editing by David Gregorio and Cynthia Osterman)

Venezuelan opposition disarray heaps pain on protesters

By Andreina Aponte and Anggy Polanco

CARACAS/SAN CRISTOBAL, Venezuela (Reuters) – With some nursing wounds, others jailed and many heading abroad, Venezuela’s young opposition supporters are demoralized by the ruling socialists’ shock election win this month, after prolonged protests failed to oust President Nicolas Maduro.

Having for months led rallies and battles against Maduro’s security forces in which scores died, youth demonstrators reluctantly abandoned the streets as the opposition turned its attention to the Oct. 15 gubernatorial vote.

Though the opposition looked set to win comfortably due to public anger over food and medicine shortages, plus soaring inflation, the government took 18 of 23 governorships.

That left thousands of young protesters furious and disillusioned with opposition leadership. Many had vigorously opposed participating in the election because it would legitimize what they see as a dictatorship.

“We have been betrayed,” said graphic designer Manuel Melo, 21, who lost a kidney when hit by a water cannon jet.

“The political opposition does not represent us,” he added, in his small bedroom in a poor neighborhood of the teeming capital Caracas. A stylized picture of a heart emblazoned one wall of the room, while a gas mask, used to protect him from tear gas during the unrest, adorned the other.

Melo and many others now see the protests, which left 125 people dead and thousands wounded or in jail, as a waste of time.

They have little stomach to return to the fight and view the leaders of the opposition Democratic Unity (MUD) coalition as traitors for abandoning the streets in favor of a ballot they believe was rigged by the pro-Maduro election board.

Their disillusionment heightened this week when four of the five winning opposition governors with the Democratic Action party broke ranks with the coalition to swear themselves in before an all-powerful legislative superbody that Maduro’s foes had vowed never to recognize.

That set off a round of unseemly in-fighting and recriminations within the opposition, with heavyweight leader Henrique Capriles saying he would abandon the coalition while Democratic Action leader Henry Ramos remained a member.

“I’m totally dejected because after all these protests, the election, nothing has changed,” said student Javier Lara, 18, who watched a fellow protester die in unrest in the volatile city of San Cristobal on the border with Colombia.

Like many young Venezuelans, Lara now plans to head abroad as soon as possible – to Peru in his case.

“We’ve been sold out by the opposition,” he said.

“ALL OVER THE PLACE”

The Democratic Unity coalition finds itself in crisis.

Its strategy of contesting the gubernatorial elections backfired spectacularly.

In the wake of defeat, stunned opposition leaders could not even agree whether to pursue fraud allegations, with some refusing to accept the election results and others publicly admitting defeat.

A breakup, or reformulation of the coalition, now looks inevitable, with a new strategy and possibly fresh blood needed for the 2018 presidential election.

Though polls routinely showed the opposition had majority support, many Venezuelans view their leaders as an elitist group out-of-touch with their problems.

“The MUD is all over the place,” said Antonio Ledezma, a veteran politician and former opposition mayor who is under house arrest. “The international community deserves an explanation of our behavior.”

Some young opposition supporters are seeking inspiration away from traditional leaders. They voice admiration for Lorenzo Mendoza, a billionaire businessman who has shied away from politics, and Juan Carlos Caguaripano, a former National Guard captain who led an August attack on a military base.

Heaping humiliation on the opposition, Maduro says daily in speeches that “peace” has won and a U.S.-backed plot to oust him has been defeated.

To stoke his foes’ disarray, Maduro has urged Democratic Action leader Ramos – a hate figure for some younger opposition supporters – to stand in the next presidential vote.

“Get ready for 2018, I’m waiting for you!” Maduro said this week, exulting in the opposition’s “chaos”, “back-stabbing” and “divisionism”.

(Additional reporting by Girish Gupta and Deisy Buitrago; Writing by Girish Gupta; Editing by Andrew Cawthorne, Tom Brown and Andrew Hay)

Leaders of Venezuela’s bruised opposition to travel abroad to denounce ‘voting fraud’

By Alexandra Ulmer and Corina Pons

CARACAS (Reuters) – Key members of Venezuela’s opposition, divided and dispirited after losing gubernatorial elections over the weekend, will travel abroad to denounce what it says is a “fraudulent” voting system under leftist President Nicolas Maduro.

Congress president Julio Borges said in a press conference on Thursday that the opposition coalition will try to stir up international support, which could result in further sanctions against Maduro’s administration.

His unpopular government unexpectedly swept to victory in Sunday’s regional vote, pocketing 18 of 23 states in the midst of a debilitating economic crisis that has millions skipping meals as soaring inflation destroys salaries.

Polls had forecast the opposition easily beating the ruling socialists. Maduro’s rivals say a mix of dirty tricks, like moving hundreds of voting centers in opposition areas at the last minute and including the names of opposition politicians who lost in primaries on ballots, worked against them.

“We made a huge effort, we aimed to overcome all the obstacles, and what the government did was upgrade its fraud and its cheating,” said Borges, adding that politicians were due to travel to fellow Latin American countries and other supportive nations shortly.

“We have the full records of this electoral process and we’re going to submit them to various international bodies, so that … they can be audited,” added Borges, who did not provide further details on the trips.

OPPOSITION FRAYING

While the opposition first cried fraud, without providing proof, it later scaled back its accusations and is now focusing on the minerals-rich state of Bolivar where it says its losing candidate was robbed of decisive votes.

Maduro blasted his opponents as sore losers who cry fraud when convenient. On Thursday, he inaugurated Hector Rodriguez, a rising star in the Socialist Party, as governor of Miranda state in a ceremony filled with song and dance.

Opposition politicians have acknowledged that demoralization in their own ranks hurt turnout. Many opposition supporters are exhausted after four months of protests earlier this year and were loath to participate in what some saw as a rigged vote that would legitimize Maduro as a dictator.

They were even more downbeat after the vote, however, as it casts doubt on whether they can remove the ruling Socialist Party in next year’s presidential election.

“The government’s handling of (Sunday’s) vote suggests that it is not even willing to entertain anything close to free and fair presidential elections in 2018, even if it prompts growing international isolation, renewed unrest, and increased outward migration,” consultancy Eurasia wrote in a note to clients this week.

(Additional reporting by Anggy Polanco in San Cristobal; Editing by Phil Berlowitz)

Venezuela opposition refuses swearing in, small protest breaks out

General view of a session of the National Constituent Assembly during swearing in ceremony for newly elected governors at Palacio Federal Legislativo, in Caracas, Venezuela October 18, 2017. REUTERS/Marco Bello

By Girish Gupta and Maria Ramirez

CARACAS/PUERTO ORDAZ, Venezuela (Reuters) – Venezuela’s opposition refused on Wednesday to swear in newly-elected governors before a pro-government legislative superbody it deems unconstitutional, as a small protest broke out in southern Bolivar state over fraud allegations.

The pro-government electoral council announced in the middle of the night that the ruling socialists had won the Bolivar governorship, meaning President Nicolas Maduro’s government took 18 of 23 states in Sunday’s vote.

Polls had put the opposition far ahead, and anti-Maduro politicians have alleged a litany of dirty tricks including switching electoral centers to dangerous areas at the eleventh hour and gross abuse of state resources.

However, they have failed to give evidence of ballot-tampering, and some opposition candidates have conceded they lost due to high abstention in their demoralized ranks.

Still, the disparate opposition coalition said its five winning candidates would not be sworn in by the controversial legislative superbody known as the Constituent Assembly.

“The governors-elect will only be sworn in as established in the constitution and the laws of the Republic,” the Democratic Unity coalition said in a statement on Wednesday.

Leftist Maduro has previously said that governors not sworn in by the pro-government legislative body will not be allowed to take their posts in a country reeling from widespread food and medicine shortages, a collapsing currency and soaring inflation.

He described Venezuela’s electoral system as the world’s most secure and slammed U.S. President Donald Trump and other foreign leaders who questioned the veracity of the vote.

BOLIVAR FLASHPOINT

Bolivar became a flashpoint after the electoral council briefly showed the opposition winning on its web site Sunday night before proclaiming the Socialist Party candidate as winner in the early hours of Wednesday.

Opposition candidate Andres Velasquez accused the electoral council of invalidating some ballots cast for him.

Pockets of his supporters protested outside the electoral board’s offices in state capital Ciudad Bolivar, with some clashes breaking out on Monday and Tuesday. Some 50 people rallied on Wednesday, though the protest quickly fizzled.

“I am going to demonstrate to the world that this electoral process is fraudulent,” Velasquez told local radio in Bolivar, home to many of Venezuela’s gold and diamond mines.

However, nationwide protest like those that rocked Venezuela for four months earlier this year are not expected, given fatigue and disappointment among demonstrators.

The perennially divided opposition is in disarray after Sunday’s election, with some leaders calling fraud and others conceding defeat, often in uncoordinated press statements.

Sunday’s election has left the socialists more confident of winning a presidential vote expected in late 2018.

(Writing by Girish Gupta; Editing by Alexandra Ulmer and Marguerita Choy)

Venezuela’s Maduro defends disputed vote, opposition divided

Venezuela's President Nicolas Maduro talks to the media during a news conference at Miraflores Palace in Caracas, Venezuela October 17, 2017. REUTERS/Carlos Garcia Rawlins

By Alexandra Ulmer and Andrew Cawthorne

CARACAS (Reuters) – President Nicolas Maduro defended Venezuela’s “secure” election system on Tuesday as opponents struggled to present a united front over allegations of fraud in a nationwide vote surprisingly won by the ruling socialists.

Despite widespread anger over economic hardship, the Socialist Party confounded opinion polls to take 17 of 23 governorships in Sunday’s election.

Stunned by the defeat that undermines their aim to win the presidency in 2018, the opposition Democratic Unity coalition refused to acknowledge the results and called the election rigged, as did the United States.

Though the coalition has complained of an unfair playing field – from abuse of state resources to last-minute moving of vote centers away from opposition strongholds – it has not given detailed evidence of ballot-tampering.

Some opposition figures have acknowledged abstention by their supporters – disillusioned by the failure of street protests to dislodge Maduro earlier this year – was a big factor.

Two losing opposition candidates, Henri Falcon in Lara state and Alejandro Feo La Cruz in Carabobo, have conceded defeat, breaking with the official coalition position.

Both criticized “irregularities” in the vote but also lamented many demoralized opposition supporters stayed at home.

“We need courage to recognize truth in adversity,” said Falcon.

The strongest criticism of Sunday’s vote came from Washington, which slammed Maduro’s “dictatorship.” Several European nations also expressed concern, while 12 countries in the Americas from the so-called Lima Group condemned “obstacles, intimidation, manipulation and irregularities”.

Washington is considering further sanctions on Venezuela, after various measures against top officials and the economy earlier this year, while the European Union is mulling the same.

Government leaders have smarted at fraud accusations.

“Venezuela’s election system is the most secure and audited in the world,” Maduro said on Tuesday. “President Donald Trump, I am not a dictator; I am a humble worker … I have a moustache and look like Stalin, but I’m not him.”

The Venezuelan leader invited EU foreign policy chief Federica Mogherini to visit or receive him in Brussels to “open their eyes,” and told “stupid” Canada to stop meddling.

Foreign Minister Jorge Arreaza later said on Twitter that Maduro had recalled Venezuela’s ambassador to Canada for talks.

‘WE WILL NOT KNEEL’

Heaping further humiliation on Venezuela’s opposition, the governors were due to be sworn in on Tuesday by a new legislative superbody elected controversially in July.

The opposition boycotted that vote and has refused to recognize the entirely pro-government Constituent Assembly, which supersedes all institutions including the opposition-controlled congress.

The opposition’s five governors-elect planned to boycott the swearing-in ceremony, defying Maduro’s threat to bar them from office for failing to accept the assembly as a higher authority.

“We will not kneel to anyone,” said Juan Pablo Guanipa, who won the oil-rich western Zulia state.

Despite food shortages, runaway inflation and a tanking currency, Venezuela’s government retains significant bastions of support, especially in poorer, rural parts of the country.

In his news conference, Maduro said the socialists also won Bolivar state, which would take its total to 18 governorships versus five for the opposition.

The government won a total of 54 percent of the votes overall, he added. The election board has not confirmed the Bolivar result or the overall vote figures.

With the opposition coalition’s dozens of parties arguing over whether there was fraud, what went wrong, and where to go next, it will need to regroup and map strategy quickly heading into the 2018 presidential campaign.

Its very future may even be in doubt, since many young activists who took to the streets for four straight months of protests and pitched battles with security forces earlier this year feel betrayed by their leaders.

The unrest killed at least 125 people.

Maduro has long accused opposition leaders of being behind violence, and on Tuesday called the new opposition governor of Zulia state a “fascist” while accusing his counterpart in Tachira of links to Colombian “paramilitaries.”

The election aftermath appears to have sunk a government-opposition mediation effort that began last month in the Dominican Republic. Even though Maduro wants to resuscitate the talks, the opposition coalition has ruled that out.

“We are the majority, the dictatorship is more-and-more illegitimate, popular and global condemnation grows daily against this regime,” it said in a communique late on Monday.

(Additional reporting by Diego Ore and Deisy Buitrago in Caracas, Tibisay Romero in Valencia and Helen Murphy in Bogota; Editing by Tom Brown)

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