Wednesday, February 21, 2007

Chavez, Kirchner Change World Financial Architecture

Miguel Lozano

Caracas, Feb 21 (Prensa Latina) More than a boost to bilateral relations, Argentina and Venezuela inked today several agreements that lay out the base for regional integration and open the way to a new world financial architecture.

Bank of the South Ready in 120 Days

The wide list of accords for industrial development, oil and gas exploitation, agricultural coop, trade and others, a memorandum of understanding stands out for the creation in a term of 120 days of the Bank of the South.

During a two-day visit of the president of Argentina, Nestor Kirchner, the heads of state signed 17 instruments of cooperation, including the start of Block Ayacucho 6 in the Orinoco Oil Belt by Argentinian company ENARSA.

The memorandum of understanding establishes the creation of the Bank of the South, an institution that has emerged in the bilateral level but with multilateral vocation.

Kirchner himself explained that the decision of both governments pretends to boost a project much talked about but still not in operation, reason for which membership is open to other member countries.

On the subject, Chavez advanced that Bolivia, Ecuador and Brazil are interested in taking part of the institution whose purpose is to finance economic and social development plans.

Thus Argentina and Venezuela open an unprecedented option in the so-called world financial architecture, dominated by the World Bank and the International Monetary Fund, whose policies have been criticized for being invasive.

In the middle term, the Bank of the South can become an option for developing countries which will be able to assimilate the monetary reserves of nations that are today deposited in the United States and Europe.

Chavez recalled that only his country´s reserves, together with those of Argentina and Brazil reach jointly 150 billion dollars, part of which may be withdrawn from banks in the north to fill the coffers of the new institution.

As of today, Argentinian and Venezuelan experts will have 120 days to lay out a plan of action, the bank´s statutes, round up resources, estimate initial capital and other technical aspects, with which an unprecedented door will be opened in the world of finances.

The strengthening of livestock production in Venezuela with Argentina´s coop, projects of cooperation in health and medicine, exchange of experience, consultancy and training of professionals are among the accords inked during Kirchner´s visit.

Also it was agreed to establish information exchange between the Agencia Nacional de Noticias de Argentina (TELAM) news agency and the Agencia Bolivariana de Noticias (ABN) of Venezuela and cooperation between diplomatic institutes of both nations.

Memos of understanding in the field of electrical equipment, import of buses with motors that run with natural gas and its reconversion, a contract for supplying fuel oil Venezuela agreed to finance Argentinian dairy cooperative Sancor and the participation of Argentinian companies in the exploitation of oil in the Orinoco Belt.

Chavez finally estimated that by its reach, the accords mark the beginning of a South American national project of integration like the one predicted by Argentinian Jose de San Martin and Venezuelan Simon Bolivar in the 19th Century.


“If the world is upside down the way it is now, wouldn’t we have to turn it over to get it to stand up straight?” - Eduardo Galeano