Risk Professional: Venezuela blocks trade with Colombia

Chavez is certainly not pro-American and his attitude was at least in part formed by George Bush II's foreign policy in relation to oil. Bush was, readers will remember, agitated (which is about as excited as anyone ever saw him get) when Chavez did an oil deal with Cuba.

And Chavez is styling himself as the president of South America - in his own head at least. So his plan for a pan-South American broadcasting network to create "balance" against US broadcasting was also unpopular in the USA's corridors of power not least because it was seen as the first step towards the potential unification of trade and policies in South America which, the USA would regard as against its interests.

And so to Chavez, anyone who is pro-American is, by his definition, against his wishes to create such a bloc.

So when Colombia and the USA announced that the South American country was negotiating to allow the USA to build four airbases in its territory, Chavez saw red. He would - he thinks of himself as a left-wing leader half-way between socialism and communism.

And domestically, Chavez has been using his policies to some good effect. And some not so good.

But the sparks really began to fly recently when Venezuela accused Colombia of chasing FARC rebels over the border and killing them. Then it was discovered that FARC has got hold of some Swiss made anti-tank weapons that were sold to Venezuela - some 20 years ago. Colombia has accused Venezuela of arming FARC and Venezuela is indignant saying that it doesn't know how FARC got the weapons but it was not with Venezuelan government assistance.

That indignant protestation escalated yesterday when Chavez decided to pull his diplomats out of Colombia - and to block all trade with Colombia.

But the FARC problem is not going away any time soon. Although several FARC leaders have been killed recently, one by his own deputy, neighbouring countries are furious that FARC seems to be crossing into their countries to hide from Colombian forced. And equally furious that Colombia is following them.

In March last year, Ecuador broke off diplomatic relations with Colombia after Colombian forces chased FARC members over the border and killed five of them;

At the same time, Nicaragua broke off relations with Colombia, saying it was guilty of "political terrorism" by crossing the border;

Simultaneously, Venezuela moved 9,000 members of various armed forces to the border.

In the past three days, Colombia says it has killed 18 members of FARC, bombing a jungle camp south of Bogata and a further 45 in a bombing raid in Meta province.

In the meantime, the USA said yesterday that it was planning to switch its Colombian support from counter-narcotics to what it terms "counter-insurgency." Aside from the fact that the Colombian problem is home-grown not insurgent, the plan appears to be intended to become a military plan rather than an intelligence led.

(first published at www.bankinginsurancesecurities.com )