According to desk clerks, the going bribe rate for a hotel room in central Caracas that is not reserved at least a month in advance is $50.

Like many things in this crowded, noisy capital, the critically short supply of hotel rooms has not caught up to the demand from a constant influx of international businessmen, domestic jet-setters and tourists drawn to what the travel brochurs describe as the "city of enternal springtime."

Standing on the towering green mountains that rim metropolitan Caracas, a congested, 25-mile-long silver of skyscrapers winding through a narrow valley, the temperature may be pure April. A trip to the valley floor, however, is a decent into the inferno, where the air is perfumed with a million auto exhausts and the ears assaulted with horns, jackhammers and the assorted roarings - echoed and amplified as they bounce off the mountain walls - of a growing society.

The mountains are Caracas curse and its blessing. For myopic romantics, they are a vision of cooling beauty, constantly belying the urban hustle below. To more pragmatic minds, they are a development nightmare, where every attempt to build slides back down into the crowded abyss.

Since there is virtually no place for Caracas to expand the price of real estate has become prohibitive. Buying land to build a new hotel in the city, says one hotel executive whose 25-year-old, 600-bed facility is always 100 per cent full, would boost the per-bed construction price to an "impossible $65,000.

"This incredible physical crunch has to affect the economy," the hotel man, a foreigner said. "Venezuela wants foreign investment, but I can see where any small or medium-sized company that wanted to establish here would take one look at the price of setting up shop and say "To hell with it, Jose."