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BUENOS AIRES - Hugo Chavez and leaders of six other South American nations have launched a regional development bank that they tout as the continent's answer to US-influenced international lenders.
With as much as US$7 billion in expected startup capital, backers say the Banco del Sur, or Bank of the South, will offer Latin American countries loans with fewer strings attached than those given by the World Bank, the International Monetary Fund or the Inter-American Development Bank.
The leaders signed the "founding act" at a ceremony at Argentina's presidential palace hosted by President Nestor Kirchner and his wife, President-elect Cristina Fernandez.
South American dignitaries and government officials cheered after the leaders signed the accord on a glass-topped table, backed by flags of their South American nations.
"Not long ago there was a general chorus singing the praises of neoliberalism" in the region, Chavez said in a speech.
"But we are now hearing the great voice of our nations."
Bolivian President Evo Morales, whose country is the continent's poorest, praised the bank as a new tool to fight poverty and ease inequalities and criticised what he characterised as the heavy-handed practices of international lenders who demand austerity prescriptions as conditions for extending credit.
"Only strong and united can South America occupy its rightful place among nations," Brazilian President Luiz Inacio Lula da Silva said.
"This will be the first international bank truly controlled by the nations of our continent."
The institution is one of several far-reaching proposals under Chavez's ambitious call to unite Latin American countries in a "confederation of republics".
His vision includes a transcontinental natural gas pipeline and trade alliances.
Venezuela, with South America's largest known oil reserves, is expected to be a leading financier along with Brazil.
But critics note much remains to be determined about how the bank will operate and say it might turn out to be a largely symbolic project used by Chavez to spread his oil-financed influence.
- AP
