President Hugo Chavez has announced a new chain of government-run, cut-rate retail stores that will sell everything from food to cars to clothing from places such as China, Argentina and Bolivia.

"We're creating Comerso, meaning Socialist Corporation of Markets," Mr Chavez said at the opening of a "socialist" fast-food location for traditional Venezuelan cornbread.

"They'll see what's good. We'll show them what a real market is all about, not those speculative, money-grubbing markets, but a market for the people," said Mr Chavez in his drive to change Venezuela from a market-based economy to a socialist one.

"We're going to challenge all that junk food that just fattens people up," he added referring to the arepa stand he opened to the public.

Mr Chavez said the Comerso chain of stores will include "a network of subsidiaries" that will sell new vehicles directly imported from China and Argentina, "without capitalist intermediaries."

"We're going to defeat speculation. Private individuals in sales can still sell, but they'll have to compete with us and with a people who is now fully aware," Mr Chavez said.

He said the new discount retail chain will also sell clothing and furnishings imported from Bolivia, Venezuela's closest leftist ally in the region.

The socialist retail outlets will serve the public alongside the Mercal supermarket chain, which sells subsidised food in Venezuela's working-class neighbourhoods.

In his effort to break Venezuela's dependency on foreign goods, Mr Chavez in May launched the Movilnet cell phone company that makes the "Vergatario," a locally made mobile that sells for $13.95 but that few stores have in stock.