Fitch Ratings issued a press release today in which the agency predicts that Venezuelan President Hugo Chavez will survive the recall referendum that the opposition is promoting against him.
Fitch is one of the most trusted global rating agencies and is an obligated source of opinions and predictions on political and economic issues around the world.
Business Wire cites Fitch's director Morgan Harting as saying 'we believe the most likely outcome is that President Chavez will finish his term through 2006. As the incumbent with considerable influence over the legislative and judicial branches, as well as the military, his position is inherently privileged, though his popular support is only 30%-40%. Nonetheless, a new president could be sworn in by April 5, 2004, if the recall proceeds without delay and goes against the president.'
A recent poll by independent polling company BEV (Statistical Bureau of Venezuela) in Caracas, places Chavez with 51% of support in an eventual recall referendum. According to the Constitution, the votes against Chavez in the referendum must exceed the numbers obtained by him during the elections that brought him into office. Therefore voting intention in polls are not an accurate indication of whether or not the President will be recalled or will stay.
Fitch's director added, 'if voters oust Chavez in a recall, he may still be able to run in new elections and win. This will require a favorable decision by the Supreme Court, but it's possible. Alternatively, the president could also resign in advance of a recall referendum and then run for immediate re-election. This may require a constitutional amendment, but it's not out of the question.'
Fitch's report on potential political scenarios in Venezuela will sure benefit the Chavez administration, which is increasing its efforts to attract foreign investment.
In spite of President Chavez anti-neoliberal rhetoric, Wall Street seems to be very pleased with Venezuela's Finance Ministry handling of debt repayment under the leadership of Minister Tobias Nobrega, and the country's conditions for investment. Venezuela's Sovereign Risk levels are at their lowest since the end of 2001, a reflection of tie country’s recovery after actions by the opposition to destabilize the economy to make their case for ousting Hugo Chavez.