THE PINOCHET AFFAIR: Chile: Chile polarised as army grumbles divided by arrest in London

CHILE'S vice-president called for calm yesterday as the detention in London of the former dictator Augusto Pinochet spawned a political crisis and polarised the nation more than at any time since the general bowed to democracy in 1990.

Pro-Pinochet senators, who hold a majority in the Upper House, said they would boycott its sessions until the retired general is freed, endangering the passage of key legislation, including a hard-won budget bill. This group, including retired military officers, also formed a "crisis committee" to fight for General Pinochet's release.

Army commander Ricardo Izurieta cancelled a planned tour of regional military bases and was expected to hold what the media here billed as "crisis" talks with President Eduardo Frei, who cut short a visit to Spain.

In the streets, pro- and anti-Pinochet demonstrations continued. Some Pinochet supporters threatened to slit this reporter's throat and warned of a "bloodbath" against Britons and Spaniards if the ailing former dictator were to die in custody. "If he dies, thousands will die here. I'll kill them personally and we'll have a military coup to restore order," said Juan, a businessman among several hundred people pelting the Spanish embassy with eggs on Monday night before being dispersed by tear gas and water cannon. Forty people were arrested and several were injured in clashes with police.

Military officers themselves were careful to avoid any such threats but increasingly began speaking out against General Pinochet's detention and against the Chilean government for "badly advising" him by allowing him to go to London on a diplomatic passport, reportedly using his maternal surname, Ugarte.

"I think he was badly advised. This kind of thing can be prevented and should have been prevented," said Brigadier General Hernan Ramirez. "The whole nation is upset that this happened to a former president and current senator."

Diplomats in Santiago read the brigadier general's remarks as a thinly veiled criticism of Mr Frei's government.

"There's no real sense of a coup on the horizon but what's causing concern is the fact that President Frei's government and the consolidation of democracy may be undermined by this whole case," one European diplomat said yesterday. Mr Frei's Christian Democrats rule Chile in a delicate centre-left coalition including the Socialist Party, and the coalition is already split over General Pinochet's detention and whether the government should be involved.

The general's personal tinkering with the constitution before handing over to democracy allowed him to become a "senator for life", but most politicians and many Chileans accepted that as a quid pro quo for winning democracy.

"The arrest of Senator Pinochet has created a climate of preoccupation among our citizens," Vice-President Raul Troncoso said in a statement to the nation. "These things happening outside our borders should not alter our co-existence or revive conflicts that we were overcoming. We have to preserve serenity. Our citizens must stay calm."

Leading businessmen also held crisis meetings yesterday amid calls for a boycott of British goods, a move denied by the government.

"This affront to our national dignity, if not overturned soon, will inevitably create a climate of instability and worsen our economic crisis," said Fernando Lihn, head of the National Chamber of Commerce. "This situation does not help our political transition and the process of reconciliation we have successfully been carrying out. It has begun to alter the internal climate in our country and could lead to a grave deterioration in the national co-existence it cost us so much to construct."

A European diplomat observed: "Most of the people demonstrating in favour of Pinochet are small or medium businessmen and women. What they don't realise is that burning a British flag in the street is hardly going to attract investment."

Eugenio Velasco, a leading businessman and former chairman of the Chamber of Chilean Constructors, said: "With presidential elections due next year, all this could create a climate of confrontation and a certain degree of economic instability."

Fernando Leniz, a businessman, added: "It's lamentable that something happening abroad is setting us back 10 years, back to the days of rancour. Unfortunately, it's now almost inevitable that the people of Chile will polarise themselves once more."

Meanwhile, local authorities in Santiago said they were refusing to collect rubbish from the Spanish embassy and were considering blocking off the parking spaces at the nearby British embassy.