Venezuela's Leader Steps Down After Court's Indictment

MINUTES after the Venezuelan Supreme Court voted to try President Carlos Andres Perez on corruption charges, presidential officials noticed the flag over the Miraflores palace had ripped, leaving a gaping hole in the tri-colored banner.

But the hole in the presidency itself - left by Friday's unprecedented ouster of the 70-year-old leader - has set the entire country on edge and the future of the chief executive in limbo.

Venezuelans like to think of themselves as above political scandal. The second largest supplier of crude oil to the United States, Venezuela has enjoyed one of the highest standards of living in the region and a reputation as a model of democracy in South America.

But the country's recent history has chipped away at that distinction. There were two military coups last year, worldwide oil prices continued to fall, the value of the currency declined, and inflation rates continued to rise, which led to demonstrations and strikes and pulled half the population below the poverty level.

The 49-member Senate on Friday unanimously confirmed the Supreme Court's decision to try the president and two of his former Cabinet members on charges of embezzlement and misuse of public funds involving $17.5 million. The trio is accused of taking the money in 1989 from the president's "secret fund" and exchanging it into preferential US dollars at the country's Central Bank.

The decision may mark the end of the impressive, yet beleaguered political career of Carlos Andres Perez. On Friday, he was forced by law to step down from his post, marking the first time in Venezuela's history a president has had to resign amid corruption charges.

The presidency temporarily passed to the head of Congress, but now politicians and analysts are debating the details of the judicial process, whether Perez could resume his position if found innocent, and who should serve in his place.

Most Venezuelans applauded the decision to suspend the unpopular leader, who has become a symbol of the political and economic corruption that has invaded the country in recent years.

The politically shrewd president enjoyed high approval ratings during his first presidency in the oil rich years of the '70s, but plummeted in popularity in his second term after instituting economic austerity measures and aggressive privatization plans to sell off money-losing public enterprises.

People still remember the riots over price hikes in February 1989 that left an estimated 400 dead said Sandro Oramas, an anthropologist here.

"People are curious to see if we can solve this in a peaceful, democratic way," he says. "Venezuela has been one of the longest standing democracies [in Latin America] - more than 30 years. And people are trying to keep it that way."

Even though people reacted with relative calm, tension hangs over the country because Perez's suspension leaves open another gaping hole: Who will be president for the remaining nine months of the term? Elections are scheduled for February 1994.

In accordance with the Constitution, Congressional President Octavio Lepage was sworn in Friday to fill the post for at least 30 days until the Congress picks someone to serve until February 1994.

The suspension also leaves the state of Perez's Cabinet unclear. His Cabinet, in a meeting last week, agreed to resign if the Senate approved the indictment. But efforts have been made to avoid paralyzing the entire government. Perez, according to local newspapers, has asked that the resignations not be effective immediately, and some of the Cabinet members reportedly said they were willing to cooperate with Lepage.

The power exchange boosted the stock market nearly 4 percent. Juan Domingo Cordero, president of the Ibero-American Federation of Stock Exchanges, told The Daily Journal newspaper, "This is an action that stabilizes the political situation.... Consequently, it should be expected for the market to rise, for interest rates to drop, and for the dollar pressure to ease."

Clusters of people crowded between the congressional building and City Hall in downtown Caracas Friday afternoon awaiting the announcement of the Senate's decision. After the vote, Lepage, in his new capacity as president, hurried to slip into a waiting car and was greeted by polite applause.

One man chuckled at the seemingly lukewarm response. "They don't like him either," he said.