Financial Times (Benedict Mander): In an isolated community on the lawless southern fringes of the Venezuelan Andes, radical supporters of President Hugo Chavez have gathered to inaugurate a "base for peace."

"We were here first, and we continue to resist; first against colonialism, and now against Plan Colombia!" they chant in unison. They are protesting against the "gringo bases" across the border, which they say threaten their country as a result of a military deal signed by Colombia and the US recently.

Aimed at organising popular militias to combat this perceived threat, the base at the foot of the lush Andean foothills in Los Jabillos close to the Colombian border so far consists mainly of a small community radio station and a struggling dairy co-operative. But it forms part of Mr Chavez' plan to prepare Venezuelans for war in the event of a feared US invasion staged from Colombia. Already, he has moved 15,000 troops to the border to quell a recent flare-up in violence, along with a drug trafficking problem.

Although many dismiss Mr Chavez' belligerence as mere rhetoric, it marks a low in relations between Venezuela and Colombia, which have been tense since the irascible leader froze diplomatic and trade links in July in response to the US-Colombian pact.

But that has only aggravated a fragile situation on the Colombia-Venezuela border. Added to the insecurity generated by paramilitary and guerrilla groups that are responsible for extortion, kidnappings and executions, the blockade is now hitting commerce and employment, causing growing dissatisfaction among locals and an increase in the flow of contraband.

"The border area is a time bomb," says Cesar Perez Vivas, the opposition Governor of Tachira state on the border. "It is a breeding ground for violence, with irregular groups thriving off drug trafficking and gasoline smuggling. They will go to war to protect their -interests."

Last week, Colombian paramilitary gunmen were blamed for the killing of two national guards, shortly after Venezuelan security forces began cracking down on illegal border activities. However, Mr Perez Vivas accuses Venezuela's socialist President of turning a blind eye to the dangers posed by Colombian Marxist guerrillas in Venezuela because he sympathizes with their struggle, even though they are believed to control about half of Colombia's cocaine trade. Their presence is frequently felt in Venezuela: locals say they were responsible for the bloody massacre of a Colombian football team only last month.

"Recent events have laid bare a conflict that has been there for many years, as well as the fact that the two governments are incapable of acting together to solve the problem," said Raquel Flores, director of the Centre for Border & Integration Studies at the University of the Andes, who says the US-backed Plan Colombia has exacerbated the problem in Venezuela as both guerrillas and paramilitaries have taken refuge across the border.

Ms Flores says the crisis in the region has deteriorated because of an increasingly tangled web of interests: not only of rival paramilitaries, guerrillas, drug-traffickers and common criminals, but also the diametrically opposed political projects of the governments of Colombia and Venezuela. Add to this Mr Chavez' domestic political conflict with the opposition government in Tachira elected a year ago. "Obviously political interests have deepened the conflict," she says. So far Caracas has not reciprocated Bogota's more conciliatory tones, while Mr Chavez has reacted coolly to Brazil's offers to mediate.

On a local level too, cooperation is non-existent. Just as Mr Chavez is accused of taking advantage of the conflict to impose centralised power over the opposition regional government, prominent politicians in Tachira loyal to the President, such as Nellyver Lugo, accuse Mr Perez Vivas of encouraging paramilitary activity in the area, a charge he denies.

But while politicians bicker, the locals suffer. "Too many innocent people have paid the price for a fight that isn't theirs," said Isabel Castillo, director for the chamber of commerce in San Antonio del Tachira, on the Colombian border. She says that border closures and Venezuela's attempts to substitute Colombian imports with Brazilian and Argentine goods have caused local commerce to plunge by about 80 per cent since August, while bilateral trade is likely to sink to half last year's high of more than $7 billion.

With some $6 billion accounted for by Colombian exports, many businesses there have been particularly badly hit.

Government critics argue that recent hostilities towards Colombia are aimed at drumming up nationalist sentiment and distracting voters from concerns such as crumbling public services, spiralling crime and inflation, with all-important legislative elections looming next September.

http://www.ft.com/cms/s/0/55739500-d0be-11de-af9c-00144feabdc0.html