August 11, 2007

Chavez Meets with Kirchner and Morales in Bolivia for Closer Cooperation

Saturday, Aug 11, 2007
By: Chris Carlson -

Mérida, August 11, 2007 (— In the final leg of his South American tour this week, Venezuela President Hugo Chavez arrived to Bolivia last night to sign several economic agreements with Bolivian President Evo Morales as well as with Argentinean President Nestor Kirchner who was also present. The new regional agreements, according to Chavez, are part of a project to unite and integrate the region into a South American block of nations.

"We continue strengthening the integration of the South," said Chavez upon arriving in Bolivia. "More than the integration, the union of the South. That is what we are doing, forming a South American political block as a counterweight to the hegemonic pretensions of North America or any other hegemonic pretension," he said.

Chavez is finishing a four-country tour of South America, where he signed agreements to increase economic integration between the countries of the region. Chavez mostly offered to supply nations of the region with the abundant energy resources of Venezuela in exchange for investment in development and cooperative projects. In Bolivia, Chavez and Morales signed agreements of a similar nature.

On Friday morning, the two leaders signed an agreement to create an oil company, named Petroandina, formed jointly by Venezuela's state oil company PDVSA, and Bolivia's state-owned YPFB. Petroandina will extract oil from different regions of Bolivia as well as in the Orinoco river basin in Venezuela and will require an initial investment of 600 million dollars. Bolivia will have 60 percent ownership and Venezuela 40 percent.

It is alliances like this that Chavez claims will form the "skeleton" of a "great South American nation." Chavez said that many more projects will be built on top of energy agreements like this one to further integrate the countries.

"We are all one nation, all one homeland," said Chavez. "Let's strengthen that consciousness, because from that consciousness comes strength."

The two presidents also made an agreement to build a thermoelectric plant near Cochabamba and Chavez spoke of the possibility of cooperating in the development of a steel industry in El Mutin, a region on the Brazilian border with rich iron deposits.

"We are willing, together with Bolivia and hopefully other nations, to install ourselves there, not to take the iron from El Mutun, but to develop a 'steel city,' a steel industry. That is what is going to give Bolivia technological development, jobs, and more income," said Chavez.

Chavez also mentioned that Bolivia has the natural resources to become a "power in petrochemicals" and pledged the assistance of Venezuela in the construction of oil and gas refineries.

"Bolivia must develop a big petrochemical industry. It can't keep exporting raw gas like it does now," suggested Chavez as one of the many cooperative projects that the two nations could do in the future.

Chavez and Morales later met with Argentinean President Nestor Kirchner in city of Tarija, in the southern part of Bolivia where the leaders signed more agreements for economic integration.

In what Kirchner called the "first step" in the project to construct a gas pipeline from Venezuela to Argentina and Brazil, Morales and Kirchner signed an agreement to build a joint natural gas refinery in Bolivia. Kirchner said the project to integrate the region's energy supply "is going to be the true development motor of our nations."

Morales also showed interest in joining the project Petrosuramerica, formed between Argentina and Venezuela with the purpose of developing cooperative projects in the gas and oil industries and supplying energy to the southern nations. Bolivia's participation in the project will be its first attempt at industrializing its huge gas reserves.

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