June 16, 2007 / 10:31 PM / 12 years ago

Zoellick warns Venezuela is heading for trouble

MEXICO CITY (Reuters) - Robert Zoellick, almost certain to be the next head of the World Bank, on Saturday took aim at Venezuela’s leftist president, Hugo Chavez, warning that his oil-fueled socialist revolution was headed for trouble.

Robert Zoellick, U.S. President George W. Bush's candidate to head the World Bank, speaks during a news conference in a Mexico City hotel June 16, 2007. Zoellick is poised to clinch the job as expected as a deadline for nominations passed on Friday without a challenger emerging. REUTERS/Andrew Winning

“It’s a country where economic problems are mounting, and as we’re seeing also on the political and press side it’s not moving in a healthy direction,” Zoellick told reporters during a visit to Mexico.

President Bush, a fervent foe of Chavez, nominated Zoellick to lead the World Bank, and the former U.S. trade representative and deputy secretary of state is expected to be confirmed before the end of the month.

Chavez has used surging oil revenues to pay for a socialist revolution in the OPEC nation and gain influence with other countries in Latin America at the expense of the United States.

He has said he wants to withdraw Venezuela, the world’s No. 5 oil supplier, from the World Bank and the International Monetary Fund, blaming their decades-old economic recipes of tight budget control, privatizations and open markets for poverty across Latin America.

“If a country feels it doesn’t need or want the services of the international financial institutions, that’s their choice,” Zoellick said. “I’ve found no shortage of countries interested in trying to work with the World Bank.”

The World Bank would focus on rebuilding in war-torn countries like Sudan, Haiti and Afghanistan under his leadership, Zoellick said.

After last month’s forced resignation of Paul Wolfowitz as World Bank president over a high-paying promotion for his companion, Zoellick was put forward as the candidate of the United States, which traditionally chooses the head of the institutional lender.

No other nominee had been made as of Friday’s deadline, making Zoellick a shoe-in for the job at the World Bank.

Chavez is popular among Venezuela’s poor majority for his efforts to redistribute billions of dollars in oil wealth but has often drawn international criticism for treading on the rights of opponents.

In May, he closed down an opposition television channel and threatened to take another off the air.

Heavy spending of oil revenues has heated up Venezuela’s economy, pushing the inflation rate to almost 20 percent and leading the government to impose price controls on basic goods.

Venezuela put its withdrawal from the IMF on hold this month because of concerns the move could trigger a technical default on its sovereign debt.

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