Chavez backs referendum to end Venezuelan crisis

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The President of Venezuela, Hugo Chavez, headed for a new showdown with the opposition yesterday, as the country's 64-day general strike appeared to be crumbling.

The government rejected a vote on a constitutional amendment that would cut short Mr Chavez's term of office. Instead, it backed a plan for a binding referendum on his presidency to be held after 19 August, which would be followed by elections if he lost.

But the opposition – an alliance of unions, right-wing parties, disgruntled business groups and private citizens – believes the President has stacked the judicial decks to delay any vote for months. The constitutional amendment, by contrast, would be voted by Parliament alone.

By cutting the presidential term from six years to four, it would mean certain elections in early 2004. The opposition is especially incensed because it claims to have collected 4 million signatures in support of the amendment.

Hopes had risen of an solution to Venezuela's political crisis in the last few weeks, with talks mediated by the Organisation of American States at the head of a group of six "friendly" countries, among them the United States. A mission by Jimmy Carter, the former US president and 2002 Nobel peace prize-winner, had also helped to improve the climate.

But with the strike dissolving, Mr Chavez is in no mood for generosity. "They have the 'F' of failure on their foreheads," he said in a radio broadcast on Sunday. "We crown the victory and continue with an offensive strategy."

In all sectors – with the partial exception of the oil industry – workers were going back to their jobs yesterday. Shops, factories, schools and banks were re-opening their doors. One mobile phone store manager said: "After two months of losing 100 per cent of our sales, it is time to reconsider our support [for the strike]."

Even in the oil industry – the core of the strike and where the disruption had worldwide effects – resistance seems to be ebbing. Production at the state oil company, Petroleos de Venezuela, edged up to 1.2 million barrels per day (bpd) – though the government claims the figure is now 1.8m bpd.

But this figure is little more than half the 3.2m bpd pumped before the strike by Venezuela, a major supplier to the US and the world's fifth largest oil exporter. Strike leaders claimed the stoppage had been a success, claiming that it unified Mr Chavez's disparate opponents, who believe the populist former paratroop colonel is trying to impose Cuban-style socialism on the country.