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Venezuelan president Hugo Chavez arrived late Tuesday night, August 9, in Montevideo, capital of Uruguay, as part of a brief visit to the "Southern axis," which includes Uruguay, Argentina and Brazil where he's scheduled to sign several bilateral trade and integration agreements.
In Montevideo President Chavez will follow on the Uruguay-Venezuela trade round begun two weeks ago in Caracas when deals involving almost US$ 130 million were considered.
Uruguayan authorities are also expecting a strong influx of Venezuelan funds for the local government owned oil and refining company, ANCAP, and airline Pluna, which have begun negotiating association agreements with their Venezuelan counterparts, the all powerful Petroleos de Venezuela, PDVSA and the airline Conviasa.
Venezuela is interested in investing heavily in Uruguay's only refinery, (several hundred million US dollars) as part of the oil rich country's market diversification policy which includes selling fuel and refined products to energy short Mercosur members.
Mr. Chavez and his Uruguayan counterpart Tabare Vázquez are scheduled to sign the agreement by which Venezuela will supply 43,600 barrels per day of crude on special terms, 75% to be paid in three months time, either cash or in exchange for Uruguayan goods and/or services, and the rest in 25 years with an annual accumulated 2% interest.
The Venezuelan President is also expected to push ahead with several of his pet regional projects such as the creation of a South Bank funded with Mercosur members international reserves deposited in northern hemisphere banks, and a Southern University to promote Latinamerican culture.
Venezuela together with Cuba, Argentina and Uruguay recently launched Telesur, a multi national 24 hours television station to compete with the "invading" United States channels.
Another project of Mr. Chavez is the creation of Petroamerica, a giant South American oil giant that would incorporate PDVSA, Petrobras from Brazil and other government managed oil corporations in the region.
Mr. Chavez will be making these proposals in representation of the Community of Andean Nations, CAN, since his country currently holds the six months rotating chair.
CAN, made up of Bolivia, Peru, Colombia, Ecuador and Venezuela is currently holding talks for an integration with Mercosur which includes full members Argentina, Brazil, Uruguay and Paraguay, and associate members Chile, Bolivia, Peru and Venezuela.
The two regional blocks are intent in the creation of the South American Community of Nations encompassing the entire continent.
"We're interested in investing in Uruguay, Argentina, Paraguay, Brazil," said President Chavez before leaving Caracas. The Venezuelan leader added that if Mercosur and CAN can't sidestep "competitive commercial integration", political integration will be unattainable because "we must emphasize on common social issues before trade".
Mr. Chavez arrives in what he considers "friendly territory", countries with which he feels a "programmatic affinity", with a fat check book, following a recent controversial Venezuelan Central Bank reform, which made available 6 of the 30 billion international reserves for "development investment".
Wednesday night, August 10, the Venezuelan President arrives in Buenos Aires for a full Thursday of agreements signing with President Nestor Kirchner.
Among them renewal of the heavy oil for food accord; refurbishing of dam turbines in Venezuela by Argentine companies and the building of several vessels for oil and derivates transport for PDVSA in Argentine shipyards.
A visit which will undoubtedly be closely monitored by United States that has openly accused Mr. Chavez of being a "destabilizing factor" in the region, loathes his closeness with Cuban president Fidel Castro and suspects Venezuela's "oil boom dollars" are actually spent in buying political influence for the former paratrooper Colonel and his socialist path to regional development.
This article appeared originally in Mercopress - www.mercopress.com.
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