President Hugo Chavez was narrowly defeated today in a referendum on his wish to run for re-election as President of Venezuela indefinitely.

Voters said "no" by 51 per cent to 49 per cent to reforms that would have, among other things, freed him from presidential term limits, scrapped the autonomy of the central bank and given him control over foreign currency reserves, swelled by soaring oil revenues.

Mr Chávez, 53, has been President for nine years and has a mandate to remain in power until 2013 but he said that he was prepared to remain until 2050 to forge his new "socialist republic".

The reforms also included stronger powers for the President to seize private property and to censor the media during emergencies. There were sweeteners, including cutting the working day from eight hours to six, extending social security benefits to informal workers, such as street vendors and lowering the voting age to 16.

Mr Chavez, noted for his fiery rhetoric, was unusually conciliatory when he conceded defeat in the early hours.

"This is not a defeat. This is another ’for now’," the President said at his presidential palace, repeating a well-known quote when as a red-bereted paratrooper he went on national television in 1992 and acknowledged his coup attempt had failed.

The self-styled revolutionary and close ally of Cuba conceded defeat but said he would "continue in the battle to build socialism". He added that the reform proposals remained "alive", suggesting that he may try to push them through later on.

Celebrations broke out throughout Caracas with caravans of opposition activists cheering, honking horns and waving flags out of car windows. Many said Venezuela had narrowly escaped the imposition of authoritarian rule.

"The reform would have made some frightening changes in our country," said an ecstatic Astrid Badell, 18, pulling a plastic green whistle from her mouth to talk."It would have practically been a copy of the Cuban constitution, and that would have been a big step backward."

While Mr Chavez remains powerful and popular, it was his first ballot box loss since he first swept into office nine years ago after failing to seize power in a 1992 military coup.

Students, business groups, opposition parties, the Roman Catholic Church, former political allies and even his usually loyal former wife all lined up against Mr Chavez ahead of the referendum vote. They accused him of pushing the constitutional reforms to set up a dictatorship.

"Venezuela said ’No’ to socialism, Venezuela said ’Yes’ to democracy," said Leopoldo Lopez, the popular mayor of a Caracas district.

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