CARACAS, Jan 11 (Reuters) - Venezuelan President Hugo Chavez urged the international community to stop labeling Colombian guerrillas as terrorists on Friday, a day after rebels freed two high-profile women hostages.

Colombia's interior minister immediately denounced the call to meet a major rebel demand as "completely off-the-wall and disproportionate."

Chavez, who brokered the rare hostage release, said the rebel groups, the FARC and ELN, "are not terrorist groups, they are armies, real armies that occupy space in Colombia."

"I ask you (Colombian President Alvaro Uribe) that we start recognizing the FARC and the ELN as insurgent forces in Colombia and not terrorist groups, and I ask the same of the governments of this continent and the world," the leftist president added in his annual state of the nation speech.

The FARC, Latin America's oldest and largest guerrilla army, is fighting a decades-long war against the state that kills hundreds each year and is now funded by kidnapping and the cocaine trade.

The ELN is Colombia's second-largest leftist rebel group.

Led by the United States, many Colombian allies label them terrorists and have imposed sanctions on the groups.

The rebels say they are fighting for greater equality in the Andean country.

On Thursday, the FARC released two hostages, politicians Consuelo Gonzalez and Clara Rojas, in what Chavez hopes could be the first of releases of dozens of other captives languishing in secret jungle camps.

(Reporting by Frank Jack Daniel, Editing by Saul Hudson and Stuart Grudgings)

AlertNet news is provided by