06/03/2013 Newsnight

Tonight, as President Chavez is mourned in Cuba, Bolivia and across

the world, as well as in his own country, Venezuela, did he waste

billions of dollars in oil wealth, or bring a degree of social justice

to the poor? Also tonight, as the number of refugees reaches one

million in Syria, the Government promises armoured vehicles and body

armour to the main opposition. Should we give them bullets and

guns as well? We cannot look the other way while

international law and human rights are flouted. We cannot step back

from a crisis that could destablise the heart of the Middle East.

payday loan companies have 12 weeks to clean up their act or else. We

discuss with the payday loan boss and campaigning MP, whether

stricter advertising guidelines will make any difference. 30 years

after Argentina planted this flag on the Falkland. What do the

Argentinians make of the islanders holding a referendum on their

future. TRANSLATION: What is the point in asking these people if

they want to be British, it is like asking an Argentinian if he wants

Good evening, Hugo Chavez is not dead, he's immortal. That, at least,

was the tone of the mourning on the streets of Caracus today. His

revolution is irreversible, according to the Government of Cuba.

But is it? Will the passing of the man who was a thorn in the side of

the United States, mean a major change to the politics of Latin

America. Did he really use $1 trillion of Venezuela's oil wealth

to transform his country, as his supporters claim, or is the real

Chavez legacy one of posturing, waste, authoritarianism and lost

opportunities. In a moment, Paul Mason will assess the economic

legacy of the man known as El Comandante. First I'm joined from

Caracus, which has seen extraordinary scenes today, by

Venezuela's ambassador to the UK. There is a short delay on the line.

What were the scenes that you witnessed like in Caracas today?

Thank you for the invitation. The scenes today are historic scenes,

because we are witnessing the passing of the most popular man in

perhaps the last 150 years in our history. One of the most popular

and respected men in Latin America. So the hundreds of thousands of

Venezuelans who poured on to the streets to pay their respect to

their leader. They did it in a very quiet way. They were expressing

their emotions. You could see there was no trouble whatsoeverment they

were marching along, crying, but also celebrating his life. Making

sure that his legacy would go on in the future. You say that, but how

can you be sure that it won't simply be rolled back when the new

President comes in, in 30 days? new President, who will be elected

over the next four weeks, almost surely will be Gabriel Mudingayi,

because he's the one -- Nicolas Maduro, because he's the one,

chosen by the people, even today you could say that this mourning

march with hundreds of thousands, they were also pushing for Maduro,

because he as the one who can guarantee that Chavez's work will

remain and will succeed. I mean Maduro and Chavez now are a kind of

combination. The one important thing to know here is that Chavez

changed, he brought a sea-change in Venezuelan politics, now people

have to be concerned for the poor, people have to put the poor first.

The poor are in the picture and welfare for the poor and concern

for social issues is important. Any politician from any sector of

society who doesn't follow those principles won't succeed in

Venezuela. There is a new kind of politics where the poor are the

priority. Please stay with us, because we

want to continue this discussion. First our Economics Editor Paul

Mason. In Caracus, the send-off has begun.

Wall-to-wall people, mourning a President who survived a coup, won

four election, but could not beat cancer. Neighbouring Presidents

paid their respects, here Bolivia's Evo Morales, toiling on foot, amid

the thronging crowd. The Chavez movement mourned. TRANSLATION:

Chavez is alive among us and will continue this fight. Chavez sowed

and he will see what he sowed, we will continue to be with Chavez.

But Chavez, the root to economic radicalism, was opened by the

failed military coup of 2002. With the old elite now powerless,

he began what he called the Bolivarian Socialist Revolution.

Over the last 12 years Venezuelan oil revenues are rocketed to $100

billion a year W that money he changed things. Venezuela's poverty

rate fell, outstripping the average fall for Latin America. After the

financial crisis, growth was not spectacular, critics blamed the

scale of nationalisation, and the flight of capital. Inflation

remains persistently high. I have been close to Chavez for the

best part of a decade. If anybody knows what Chavez was trying to do

it is this man. A British marks igs, whose books Chavez read -- Marxist,

whose books Chavez read and became a close associate. Millions of poor

people in Venezuela without access to health, were provided free

medical service by the Cuban doctors, which was a deal in

exchange for oil and provided by Cuban doctors. And there was a

report that say the that Venezuela was illiteracy-free. I don't think

that gets to the heart of the question. Here is a man, you can

say what you like, here is a man that gave a voice to millions of

poor people that had no choice previously. Though inequality has

fallen and is the lowest in Latin America, the Chavez regime came

under persistent criticism from human rights groups, for political

pressure on judges, and on the opposition media. For his opponents,

the economic upside all comes at a price. 14 years of Chavez's rule

has left Venezuela, frankly, in a shambles. It has one of the highest

inflation rates in the world. On par with places like Zimbabwe or

Ethiopia. It has staggering debt, large and growing fiscal deficit,

crumbling infrastructure, growing blackouts and power outages are now

common. Soaring crime. Almost every facet of economic life and social

life in Venezuela is in worse nonthan when he found it.

Chavez didn't just use the oil money at home, he used it to help

Cuba, to help Argentina clear its debts. He used preferential oil

prices to aid allied countries in Latin America and the Caribbean.

The result is a continent visibly shifted to the left. But now

Venezuela faces a new election, and the opposition is set to stand on

the platform of an end to free oil for other countries. In London

tonight, those signing the book of condolence know that for a

revolution this one relied mightly on the will and popularity of one

man. Chavez did not by any traditional definition deliver

socialism. What he delivered was a capitalism of redistribution, a

pro--poor capitalism. And he used the oil -- pro-poor capitalism. He

use the oil money to defy the United States and gain diplomatic

independence like no-one else in Latin America. Where Venezuela goes

next depends on how that can survive without the personality of

the man himself. While some expect a phase of moderation after this

mass outpouring of grief, others want the masses, thus mobilised, to

push things further. You can't plan what you don't control. You don't

control what you don't own. In other words they have done half the

job, but the other half remains to be done. And the job as far as you

are concerned would be that classic socialist transformation? Oh yes.

We will never know what Hugo Chavez would have done with his fourth

presidential term. What his successor does will have impact all

over Latin America. The ambassador is still with us from Caracus, and

we will be joined by Argentina's ambassador to the United Nations,

and the documentary film-maker and who met Chavez.

Ambassador, the charge against Chavez is you should be a much

richer country, but he's made a mess of it. For example, a third of

your oil export money is use to pay off the debt to the Chinese. It is

economic lunacy? OK thank you very much for that question. One of the

facts that most people ignore can you hear me? Let's see if you can

hear me. I can hear you? Can you hear me now. Yes. OK, one of the

facts that most, one of the facts that most people ignore is that the

20 years previous to Chavez's Government the Venezuelan economy

fell for almost 20%. And that was what explains Chavez's victory in

1998. Even though with all the oil and money that we had previously,

the Venezuelan society impoverished itself to ridiculous levels. With

Chavez we have reverted that tendency, and that is why you can

see millions of people voting for Chavez for more than 15 elections.

So it is ridiculous to say that the country is in a shambles, when the

real shambles, we had it before Chavez. OK, ambassador we will

leave it there, thank you very much for joining us from Caracus.

Let's go over to Arao, and Emilio Cardenas, -- Buenos Aires, and

Emilio Cardenas, can you explain to me how you think the country has

performed under Chavez, when we have heard that what he did was he

took a country where there were huge discrepancies between rich and

poor, and he allowed a degree of social justice? My major concern

with these 14 years under Hugo Chavez that Venezuela has gone

through has to do with the deterioration of democracy. Under

Chavez the checks and balances of democracy have virtually

disappeared. The legislationive body is just rubber stamping what

the executive power says, the judiciary is not independent any

longer. There is a major concentration of power in the hands

of the executive. In addition to that, Venezuela has lost some of

their fundamental freedoms. We will come on to that in greater detail

for a second. Would you accept in terms of the economy that he has

tried to redistribute wealth to some of the poorest people in his

country, and that's why so many of them turned out today. They think

he's got a grip on the economy, the right grip? Are you asking me about

the situation of the Venezuelan economy now? Yes.

I think that the economy is going through a major difficulty. They

have just, as you know, devalued. They have a very high inflation.

There are all kind of price distortions caused by the subsidise.

-- subsidies. If Maduro is elected that is not going to change at all.

If the opposition instead makes it to the Government in the forth

coming elections, then the Venezuelan economy may begin to be

rebuilt. But at this time the people of Venezuela, after the

devaluation, have relatively lost a lot of the standards of living

particularly compared with neighbours. The economy of

Venezuela is far from being in an ideal situation. Let me bring in my

guest in the stud yo. It is far from an ideal situation. We see a

lot of run away inflation, and a lot of money that could have been

spent on building up the intrastructure and it hasn't been

done. Dfrpb infrastructure, and it hasn't been done. When talking

about the flainflaigs it was 55% when chaff -- talking about

inflation, it was 55% before Chavez took over the presidency. There

were massive investment in infrastructure, growth last year

was 5.6%. I think someone mentioned that there has been mass social

investment. This is the reason why millions of Venezuelans are voting

for Chavez. If the scenario this doomsday scenario presented by

other speakers, it would be counterintuitive for Venezuelans to

vote for Chavez. The oil production has dropped by 25% since 2001,

there is a booming oil price, it is not a well-run economy? It is part

of a cartel, as part of an OPEC cartel, sometimes oil production

has to decrease in order for the price to remain high. What about

the debts, $45 billion of debts to the Chinese, taking up oil exports

a third of them just to service it, that is nuts? I know with the

Government they have signed close to 300 agreements with China. Last

year there was one signed for $40 billion worth of investment. It is

diversifying its economy away from the US. I think this is to the

benefit of the Venezuelan people. Let me bring in Emilio Cardenas

again, do you accept that he was elected several times, fairly,

international observers said these were fair elections. So even though

there were problems with the press and some of the anti-democratic

pressures you talked about, fundamentally he was the legitimate

ruler of his country? I can hardly hear you, my friend. The

microphones and earphones are not working well. Do you accept that he

was elected several times fairly and in that sense he was a

democrat? Well, to be a democrat you need more than being elected by

normal elections. You need to respect the values of democracy,

and you need to uphold, by the institution, respecting the working

of the institutions. So I think that one thing is to look

democratic, and a very different thing is to be democratic. I think

that Venezuela has now a chance to recover democracy. We will see

whether the opposition can grab that chance. Alternative low they

will stay in a situation where they may look democratic, as I said, but

where the working of the democracy is far from the normal work of a

democracy. A final thought on that. Isn't that the point, that he may

have done certain things for social justice, as you say, he did them by

being an autocrat rather than a democrat? I find it strange that an

autocrat has 15 elections in 14 years, and won three presidential

elections with resounding victories. I have to be careful. But he closed

down the opposition, some opposition press people, he put

people in jail, without due process of law. These are not the action of

a democrat? Again my understanding of these cases is probably

different to yours. We don't have time to go into them. With regard

to the private media, we can't forget that they essentially played

an instrumental role in the US- supported coup against them. They

are regulated in a way they would have been regulated in Britain.

Thank you very much. In a moment, what do the payday

loan companies need to do to stay in business? And 30 years on,

mapping the future of the Falkland. Now, is Britain tiptoeing towards

arming the members in Syria. The Foreign Secretary, William Hague,

announced body armour and armoured vehicles and communication

equipment will be sent to the rebels. It is to protect civilians,

it is not guns and bullets, not yet. The day when we learn a million

Syrians have been forced out of the country by horrific violence, one

in 20 of the population. Should we avert a further humanitarian

catastrophe by giving the fighters what they say they need?

Faced with what he called extreme human suffering, the Foreign

Secretary, William Hague, announce the UK would be stepping up support

for the Sir -- announced the UK would be stepping up support for

the Syrian opposition. We are identifying equipment most useful

to them and most likely to save most lives. I will keep the House

updated. It will certainly include armoured four-wheel drive vehicles

to help opposition forces move around more quickly, and he

protection equipment, including body armour. For the rebels it is

not enough. They argue they need weapons and ammunition to fight Al-

Assad's regime. The west has been reluctant to give them what they

want. Many have pointed out that atrocities are committed on both

sides of the conflict. There are fears that any guns supplied by the

rest could go directly into the hands of extremists, including Al-

Qaeda, known to be active in the country.

The EU currently has placed an arms embargo on Syria, though Britain is

pushing for it to be relaxed. All the while refugees continue to

flood out of the country. With Turkey, Jordan, Lebanon and Iraq,

all having to provide support for hundreds of thousands of Syrians

crossing their borders. The pressure for action is rising,

and with the Arab League saying today that their members are free

to offer military support to the rebels, just how long will it be

before British supplied weapons are being used in Siria.

Gareth Owen from Save The Children has returned from the region, and

the chair of the Foreign Affairs Select Committee is also with us.

What conditions are there in Syria? They are truly awful, unimagineably

awful. If you are a refugee, and we have reached a grim milestone where

one million have come, and half a million Syria. Millions of Syrians

are living in abject conditions. We are watching a middle income

country slowly but surely be completely destroyed. You are in a

humanitarian organisation, do you accept that the only thing to stop

this is ending the war, which means overthrowing Al-Assad, which means

someone may have to give guns to the rebels? I do think the end to

suffering is ending the war. We have to demand the global world

leadership finds a way to unite and create some actionable plan to

bring about the end of the conflict. To go as far as to say do I think

that is a question of arming the rebels. I think that is for others

to answer. Require Malcolm Rifkind raised it in the Commons. I

wondered if you thought armoured vehicles and flack jackets, and

water purification might be fine, but it won't bring it on an end?

Malcolm did raise it, I don't agree with him. I think there is a big

difference to giving aid to civic and rebel leaders we know. And

giving weapons and ammunition to hard-nosed militants who come from

all over the world to cause trouble, whom we don't know, and whose

intentions are unclear. Those, by definition, would be the wrong

hands. The recognised head of the opposition army, said they need

anti-aircraft missiles and aircraft, that would stop the stilling of the

civilians? I think William Hague has got right. There has been a

step forward, announced today, we are providing more protective

weapons for the rebel leaders, we are providing testing equipment to

see if Al-Assad starts using chemical weapons. This is all very

important, but if you start going into the anti-tang territory, where

does it go? It is not -- anti-tang territory, where does it go. It is

Jihadis flocking in all from all over the world. That is the dilemma

for humanitarian organisations, I know you hate to say that people

need to be armed, but you need to stop the tangs and the planes?

on the side of the Syrians, and not on an armed group. I have worked in

conflict for 20 years, it ends up in the same place. Whether it is

Somali, where I started out, or the Balkans, sooner or later you get

into this debai. We have a more immediate concern, not to doubly

fail the people of Syria. If we can't find a political solution

quickly, that is a shame. It would be a disgrace if we didn't upscale

the urgent humanitarian relief, not reaching the people in Syria in

adequate cannotties at the moment. Part of the debate you have already

raised, the specter of Afghanistan and Iraq, where guns did fall into

the hands of other people, you arm one lot and it turns out to be the

Taliban or Al-Qaeda who get T on the other hand there is Bosnia, as

was suggested, and Rwanda, where we didn't do anything, and now you

know did nothing but hand wringing afterwards? It is slightly academic

as to whether or not we should be supplying arms to the rebels. They

are being supplied already by other people. The Arab League have now

said, but not enough? You say that. There seems to be a lot of stuff

going in there, whoever is supplying at the moment I'm sure

can up it. We have to carry people with us, the United Nations won't

back this, as long as China and Russia are exercising a veto. The

EU is being fairly supportive, but up to a point. I think actually in

a rational, proportion national response to what is going on at the

moment, where the Foreign Secretary is the right place to be. It was a

move forward? It was, closer to intervention. He left all options

on the table. He did, I wondered if relaxing or threatening to relax

the EU arms embargo, would that possibly be yet another step in the

right direction? It would, it is more or less what he has done. He

has kept his options open. He has said this is under constant review.

He has made it clear that is something they will go back to.

do you see things developing over the next few weeks? Not well. The

history of these situations is it gets worse and worse. Six month

from now we could be talking about two million refugees and a million

children fleeing. Where does it end? I don't know, there is no easy

answer. My experience tells me this gets worse and worse, and the

humanitarian scenario become more and more acute, with increasing

loss of life, and we end up a year from now in the same place, only

much, much worse. You have eloquently explained the dilemma,

two million refugees, three million, there is another couple of million

displaced within Syria. Where do we say that is it? There is no obvious

answer to this. It is, frankly, just a mess at the moment. As long

as the international community can't agree on this, then we have

trouble moving forward. William Hague did meet the Deputy Foreign

Minister for Russia today, he's meeting the Foreign Minister next

week, he will continue to put the pressure on. It is quite possible

that Assad may run out of money, sooner or later, there may be other

forces there who may topple him. What is going to step into the

vacuum is far from clear at the moment.

Thank you both very much. Fundamental problems, irresponsible

lending, widespread breaches of the law and regulations, causing misery

and hardship. That is the Office of Fair Trading's verdict on the

payday loan industry. After researching the methods used by the

50 biggest lenders in the country, Wo nark ga and the like. The loan

companies have been given an ultimatum, clear up the �2 billion

industry or else. Liz Matthews is not your average

payday loan customer. While most have jobs, she doesn't. But in

other ways she is typical. Someone in need of a short-term cash

injection. Drawn in by the ease with which she could get it,

undeterred by the spiralling interest payments that kicked in

the moment she couldn't pay it back. Looking back now, I think how

stupid I was. I got into a vicious cycle, where I borrowed all

together four loan, and in the end I couldn't pay any of them back.

How much was the original loan, how much do you owe now? The original

loan was �300, and I owe now clearly �2,000. I was very worried,

I thought how can I pay it back. You can't sleep. You can't sleep at

night. Newsnight featured other payday

loan customers last year. Just before the �2 billion industry was

warned it had to serve them better. These borrowers arranged almost

instant loans from the comfort of their smartphones. My first loan I

took out a month ago, I oozed it to go out and see my friends. Without

that I couldn't see them. Aided by technology and abetted by the

banks' reluctance to lend, the payday loan industry has doubled in

size in the last three years. The Government said today it was

concerned customers were being lured into taking out unsuitable

loans. With advertising offering A number of payday lenders have

been laifing in a completely irresponse -- behaving in a

completely irresponsible way. The OFT are putting 50% on notice over

their behaviour. They are requiring them to take specific actions.

Office of Fair Trading's main concerns are failure to check a

customer's ability to repay a loan. Failure to explain adequately how

payments will be collected. Aggressive debt collection

practices, including not showing enough understanding for customers

struggling to pay. Payday lenders are required to assess the

affordability of every loan they make, to make sure that people can

repay those loans. And yet that seems to be in conflict with the

fact that they earn up to half of their revenues from customers who

fail to repay their loan first time round. That suggests to us this

market really isn't working the way it should, for that reason we are

proposing to refer this market to the Competition Commission, it will

be able to put in more radical changes if it thinks it is

necessary These companies are rewarded through customers'

difficulty? It would looks a though these firms are winning significant

revenues, yes, from the fact that their customers are unable to pay

things on time. In 12 months, the financial regulator, the FCA, will

take over responsibility for the payday loan industry. It will have

powers to impose a cap on the run away interest rates, which can,

when loans are rolled over, snowball to several thousand per

cent. When the FCA takes over the Office of Fair Trading will cease

to exist. This strike against the loans' companies could be seen as a

dying gasp. But the OFT prefers to call it an enforcement priority,

warning that if the industry doesn't shape up within 12 short

week, the worst offenders might lose their license to trade.

Liz is repaying her now large loan at the rate of �3 a week. She

thinks today's measures don't go far enough the When you see them

advertise, it is just so easy to get, a few minutes on-line, you

state how much you want. You don't really notice how much interest you

are paying back. I think the interest rate should definitely be

capped. It is an awful lot of money they ask you.

The payday loan market says it is already put improvements in place,

but will consider going further. Access to credit remains a

necessary service. But they will have to show that in answering that

need, they are not making a bad situation for their customers even

worse. We called more than a dozen payday

lenders who declined to appear tonight, but Jason Gardiner runs

Friday Friday, who calls itself an ethical company. How do we dress it

up asset kal, it is a pretty scumy business? There is a lot of

nastiness going on about the business and rightly so. The

industry has a bad reputation at the moment, that is because of the

things highlighted today. The way we say they are ethical, we want to

do things differently, we want regulation in the industry, we want

to be seen to be different, we ant to act differently -- act

differently and put the consumer first. We know the top ones are

being investigated. The FT has said it is right across the sector,

clawing back debts and earning up to half their revenue from rolled

over deals. You do that? We limit roll overs to three. Three?

three roll overs, then we convert any capital they owe into a 6-12-

month loans. The you are not as bad as others, but that is seriously

bad? We have to give people the option, if they can't pay after the

first month, they have to have an option to do something, or what is

the alternative. Most companies do what you are talking about. Why do

you advertise on your website that you don't do credit check, if you

do them, you don't do them the way in which banks do. That is shoddy

practice this report has shown is widespread. I have just checked

your website this evening? It is not on our website. I hate to go to

your website, it is on there now, it says you don't do credit check,

what the OFT has said it shoddy. clearly do credit checks. You say

it is not on your website, but you do the same practices? We credit

check every single application, we validate the bank account, address,

credit history, how many payday loans and loans they have, how many

credit cards they have. We do full affordability. If he didn't exist,

wouldn't people go to unlicensed back street loan sharks? I don't

want payday lending to end, I want it like other counts, the rates are

capped and we don't see the problems. We see lower levels of

personal borrowing and illegal lending. You would be OK with

capped interest rates? Capped interest rates as long as we can

sit down and do to properly, as long as we sit down and it has to

be sensible caps. Because the cost to fund payday loans is the costing

a lot. 1,000% would be OK, not 500%? That is based on a lon over

three months, these are short-term loans. Your APR is 17,000 per cent.

It is not an annual loan it is a month loan. (all speak at once) In

Japan they have worked to go from a 79% cap, to a 20% total cost cap?

We need to sit down and lock at it. We are pushing it, I asked you four

months ago to sit down and discuss it. On Twitter you called me niave

and ignorant of the industry. accused you of looking a blanket

over the industry, and accusing us to be like Wonga, when I put it to

you, you said you are like Wonga and I won't sit down with you. We

want a cap, limit rollovers. didn't say that, I asked for the

data. What I said to all the companies I don't want nice dinners

I want date ta. Fantastic you want a cap? Do you want the cap like

Japan. Do you want a total cross cap, they have worked with the

industry and moved it down to 20%? We need to look at what is best in

this country for the people of this country. In terms of some of the

other options, should they just be banned from advertising all

together, we banned tobacco advertising on TV? I find the

puppets and all the adverts as annoying as everybody else, the

damage is done by the rates the companies charge. What the OFT

report shows today is these companies are pushing people into

debt because they make most of their money about the people who

repeat borrow and roll over and then the charges start. I have been

told your website says, right now, without any paperwork or credit

checks you can get a loan, I have just been told that? The without

paperwork is correct. Without credit checks, I'm being told

exactly that? This is exactly why the Government needs to step in.

This industry it is like asking turkeys to organise Christmas.

There are people in communities like mine who are really struggling

as a result of this. It is inexcusable having seen the

evidence today that this Government has failed to back the cap on

credit, I'm proud Labour has done? I think the FSA needs to get

involved when it is in place to do so. We are pushing for regulation,

we want it. We introduce debt management to individuals who

default on loans, we want to help them out of debt problems not into

it. She's saying the key problem is interest rates, and they have to be

capped? It is not just that, all the additional charges, the default

charges, the �25 to not pay on time. We are also the only financial

institution in the country, anyone who defaults we freeze interest at

that point. Most lenders do that. Including Wonga even. Not at the

point of default, they don't. If somebody comes to payday, their due

date, and we don't recoup the funds then, we freeze the interests.

17 though per cent. At the point in the original contract. Thank you

very much. 30 years ago Britain sent a task

force to liberate the Falklands from Argentina. And Argentina has

regularly asked for the return of the la Malin, and Britain has said

it is up to the islanders themselves. Just ahead of a

referendum, Sue Lloyd-Roberts reports from Buenos Aires about a

vote of a couple of thousand islanders, who definitely see

themselves as British, is viewed in Argentine na.

-- Argentina. This is one of Argentina's favourite rock bands

belting out the song they call, April 2nd. The day on which

Argentina invaded the Falkland Islands many years ago. It goes

down well with the young, many of them not born when the islands were

invaded. I met them in a park the next day to ask them why they care?

At school, we are taught that Malvenas are Argentinian, and

Argentina should claim them. That is our feeling. It is only natural

that the whole population will say that if you are taught that way

since a little kid. It is a little bit of brainwashing. I have never

begin brainwashed about any ideas. I have always -- been brainwash

about any ideas. I have always thought the islands were Argentina,

heiror kal and geographical, that is why. What about the referendum,

is it significant? It is the general will of the people, they

are actually electing the way of Government and which Government

will represent them. It is absolutely right. What happened in

1833, when the English Government arrived to the La Malvenos islands,

what happened to the people who lived there, and their self-

determination rights. Who is right? At the national library this

professor was eager to help. Bringing out an array of maps and

documents which show that over some 400 years, the islands had been

settled by the Dutch, the French, the Spanish, the Argentinians, and

then in the 19th century, Britain staked a permanent claim, and at

the time Argentina did not intervene. It is confusing, but the

professor put me right. The islands are Argentinian, she said.

The claim to the islands didn't matter that much 100 years ago.

When Britain was Argentina's most important trading partner.

Reminders of the close relationship litter the country. Like the

HurlinghamClub, built to kairt the huge British community that once

lived in Argentina, and where the Middlesex county cricket club play

against an Argentinian side of the You have like every part of the

world, people against and for, just mixed feelings.

And Britain's place in Argentina? It is difficult to say. I have got

both. My father is British, and I'm Argentine born. So I just find it

awkward. Everyone here want to draw a

distinction between people and politics. We have no problem with

the British people. We all study English at schools here. I love the

Rolling Stones, I love football, the Beatle, many things to love

from England. If -- Beatles, many things to love from England. If I

were to feel angry about somebody, I would feel angry about Margaret

Thatcher on the English side, but also the leaders on the Argentinian

side, both sides. The over 600 Argentinian war dead

are remembered in Buenos Aires every day.

One thing that everyone can agree on is a general -- General Gaultier

decision to invade the Falkland, was to gain popular support for a

military -- Tateorship, which by the 1980s was morally and

economically bankrupt. It didn't -- dictatorship which by the 1980s was

morally and economically bankrupt, it fell soon after. The Argentinian

economy is in trouble again. The sight of the unemployed collecting

rubbish, to sell on to recycling companies is a common one.

Strikes are frequent. Here teachers are demanding pay rises to match an

inflation rate which they say is nearly 30%.

The Government won't give an official figure.

Do they believe that this new row with Britain, over the Falkland,

could be a deliberate diversionary tactic by the country's President.

TRANSLATION: No, I can honestly say no. She has her own policy on the

islands, and economic issues are a separate matter in Argentinian life.

TRANSLATION: She's always talking about the island, it is an

historical thing, whether British or Argentinian, there is no

advantage for the working-classes. Nonetheless, the claim is might,

the islands are Argentinian. While most would say that the

referendum, being organised by the fouk land island Government this

weekend is -- Falkland islands Government this weekend is

irrelevant, political commentators think differently. The referendum

is a very historical issue, there is a they are part in the

historical conflict between argentinia and Great Britain. Not

only London and Buenos Aires, there is a third actor in the Falkland

Islands. That is the political authority of the Falkland Islands.

But this is the stuff of editorial writers and the chattering classes.

And doesn't interest the President. A few days ago, President Cristina

Fernandez De Kirchner, arrived in parliament for her state-of-the-

nation speech. And unveiled a flag which Argentinian troops had

planted on the Falkland Islands. She then confirmed her claim to the

island, and made no mention of the referendum. The President rarely

gives interviews. I asked a member of the Government committee for the

island, what he thinks about it? TRANSLATION: I want to ask you a

question, are those people living on the islands British? What's the

point of asking these people if they want to be British, it is like

asking an Argentinian if he wants to be Argentinian. They could do

without this referendum. There is no point to it, we know what the

outcome will be. Do you really expect us to believe that it is

self-determination that you care about? Not the oil, the military

importance of the south Atlantic and the territorial claims on

Antarctica? The wealth found in the area surrounding the Falkland puts

a new edge on the debate. Only 500 miles away, Argentina could benefit,

by providing for the need of oil companies operating here. There

were commercial links with the islanders before this present

Government refused to deal with an authority they won't recognise.

Isn't Argentina therefore in danger of missing out? That is a very

intelligent economic logic. This is a political problem. We have a

political conflict, and for Argentina the meaning of Malin os

is not logical it is political. In a country with a troubled recent

past it goes on. This week's referendum will change nothing. The

British Government is firm that the sovereignty of the Falkland Islands

is non-negotiable, without the agreement of the islanders

themselves the here in Argentina, people will continue to maintain

that the islands were, are and will be Argentinian.

Do you think you will see the islands become Argentinian in your

lifetime? No I don't think I will. Not become Argentina. I think it

should happen, but I don't think I will see it.

Yes, of course, I think they are Argentinian.

No, and I don't want that to happen unless the population there

actually decided they wanted to be Argentinian. I think that

argentinia is taking the -- Argentina is taking the wrong

approach, without harassing them, we should show them they have a lot

of education and economic opportunity here, that is a better

way to integrate them. Perhaps in 100 years they will decide they

want to be Argentinian as well. Veterans of the war demonstrate

daily in Buenos Aires for better pensions and recognition. For

everyone in Argentina, the islands provoke painful emotions for which

there is no immediate or practical solution.

Now a very quick look at the front That's all we have time for tonight,

Good evening. Wednesday, certainly brought a lot of cloud and through

Thursday, it is going to be another cloudy one. And we are going to see

outbreak of rain pushing support addically northwards, across the

north of Scotland -- support radically, northwards.

This cloud producing some outbreak of patchy rain. Most of it quite

light. Won't be surprised if you see the heavier burst here and

there. We may see glimmers of brightness from time to time. Grey,

cloudy conditions across Wales. Mist, muark and fog up over the

hills, and for Northern Ireland, it is a grey story with outbreak of

patchy rain. Wet weather for a good start of Scotland as well. Glimmers

of brightness here. Across the far north of Scotland and Shetland,

here we have a cold, strong Eastleigh wind. As I mentioned most

of the rain will be quite light. In any of our northern cities, don't

be surprised to see the heavier bursts on Thursday.