FACTBOX-Risks to watch in Latin America in 2010

CHAVEZ IN VENEZUELA

After over a decade in power, socialist President Hugo Chavez has numerous problems to deal with and faces legislative elections in September. He is likely to seek the initiative by putting pressure on opponents and possibly announcing more nationalization while keeping tensions with neighboring Colombia on the simmer.

With ratings around 50 percent, Chavez is still the most popular politician in South America's top oil exporter, but he is wrestling with an economy in recession as others are recovering; water and power shortages; high crime in part linked to the growing drugs trade; double digit inflation; breakdowns in the oil sector and a drought.

A spate of failures of small banks has put more of the financial sector in state hands. Chavez is seeking to reduce public sector dependence on private heath care and wants to build a large state-owned insurer.

Things to watch:

- Economy. A long recession would hit Chavez's popularity.

- Tough moves against opposition figures before election.

- Nationalizations and increased grip on financial sector.

- A border incident with Colombia slipping out of control.

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