Chavez Signs Deals, Strengthens Alliances in South America

By Leandro Prada | July 7, 2008 | 8:18pm EDT

Buenos Aires ( - Venezuelan President Hugo Chavez is wrapping up a whirlwind tour of four South American nations, dispensing largesse in the form of investment and energy deals to enhance what he calls "regional integration."

The populist, anti-U.S. leader this week visited Argentina, Uruguay and Ecuador, with a final stop in Bolivia Friday.

In Argentina, Chavez signed an agreement to build a $400-million plant that will process liquefied natural gas shipped in from Venezuela. He also agreed to buy $500 million worth of debt bonds, a move that makes Venezuela one of the biggest holders of Argentine bonds.

Alberto Fernandez, chief of staff to Argentine President Nestor Kirchner, was quoted by the national newswire Telam as expressing gratitude to Chavez, saying he had been there for Argentina when international financial institutions were not.

For his part, Chavez declared: "Argentina is setting itself free from Dracula, it is breaking the chains of the International Monetary Fund."

In other remarks while in Argentina, he said during a television interview that he hoped for better relations with the U.S. after the 2008 presidential elections, but added, "Whether it is a Democrat or a Republican president, the imperialistic measures need to stop."

Asked whether Venezuela was a socialist country, he said, "Christ came to this world to propose a socialist model ... we are leaving capitalism, but it is a long-drawn process."

And in reference to his relationship with Iran -- which Argentina's Jewish community blames for two huge bombings in the early 1990s -- Chavez said, "The first terrorist state of this world is called the United States." He said he was not anti-Semitic, but "anti-imperialist."

This was Chavez's second visit to Argentina this year. Last March he hosted an enormous rally at a Buenos Aires soccer stadium against President Bush, who at the time was visiting neighboring Uruguay.

After this week's visit, Chavez stopped next in Uruguay, where he stayed in the same hotel room Bush had used five months ago.

In his characteristic U.S-baiting manner, the Venezuelan leader declared that the hotel room smelled okay -- that the "sulfur" smell had dissipated with time. Chavez has in the past likened the American president to the devil, notably when addressing the U.N. General Assembly last September.

In Uruguay, Chavez signed an agreement pledging to meet Uruguay's oil and gas needs for the next 100 years.

As was the case in Argentina, the trip to Uruguay was characterized by expressions of deep gratitude to the visitor.

"What nation, what government, what president may be more generous [than Chavez in his help for Uruguay]?" asked left-leaning Uruguayan President Tabare Vazquez. "I don't know other examples."

Chavez in turn thanked Vazquez for supporting Venezuela's application to become a full member of Mercosur, a trade bloc comprising Argentina, Brazil, Paraguay and Uruguay.

The parliaments of all four member-states have to approve the application, and lawmakers in Brazil and Paraguay have not done so. Chavez's regional tour did not include visits to Brazil and Paraguay.

Chavez attributed the Mercosur difficulties to the Bush administration.

"I want to thank your generous and strong support," he told the Uruguayan leader. "But, Tabare, the truth is that the U.S. does not want Venezuela in Mercosur, and it's moving its players."

Moving on to Ecuador, Chavez met with leftist President Rafael Correa, who told him, "You know, commander, friend, president, that you are always welcome, that our arms will always be open for you," according to the Ecuadorian newspaper, El Universal.

Chavez agreed to cooperate in the construction of a $5 billion refinery capable of processing 300,000 barrels of crude oil a day.

Regional analysts are mulling whether the agreements signed this week will make the recipient countries more dependent on Chavez and further align them to his cause.

Writing in La Nacion, Argentine political analyst Joaquin Morales Sola said that Argentina's ties with Chavez are detrimental to its other foreign relationships.

"[President] Kirchner usually says that his association with the Venezuelan [leader] is of mutual interest, which does not link them in ideology," Sola said. "The conflict appears when the interests are so intertwined that the interests are confused with the ideas."

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