The Banco del Sur, 21 February 2007 as a bilateral agreement between Venezuela and Argentina launched with the hope that other South American countries to join soon. The support of the six countries is expected that much-needed capital injection into the project. According to El Comercio Ecuador, the Bank an initial capital of U.S. $ 7 billion U.S. dollars will be used to primarily for regional development projects.
English-language news sites often refer to the> Bank as a populist initiative of Venezuelan President Hugo Chávez, which means that it is not a serious project. It is true that the bank will replace Washington-based lending organizations like the International Monetary Fund (IMF), World Bank and the Inter-American Development Bank (IDB) is seeking, it is too easy to get it to write off only as populist rhetoric, especially when Considering that the "populist rhetoric has earned" mostly good critique of predatoryLending policies in the past, followed by those organizations.
The history of South America, and international finance is long and complicated. In short, the 1980s and 1990s a wave of neoliberal reforms, privatization of state enterprises and a restrictive fiscal policy emphasized at the expense of social spending. The Washington lending agencies that promote policies that often, the communities that adopt certain policies in exchange for much-needed funds. Thisinterventionist policies rubbed many in the region in the wrong direction and is in large part responsible for the negative image of the United States is now in the region today.
Following the economic and political upheavals, the continent in the early years of the 21st Century dissolved, in many cases as a direct consequence of these high-interest loan payments, many South American countries now have a credit rating, making it difficult to secure low-interest loans to finance necessaryInfrastructure and development projects.
In early 2000 at the Summit of South American leaders in Brasilia, two years before the founding of the Bolivarian revolution in Venezuela, leaders have tried to find new and innovative ways to finance regional development projects. The Banco del Sur is an answer to these questions. It is an example of regional leaders to take responsibility for their own problems and seek solutions at home rather than abroad. Whether the bankbe competitive in the long run is another question all together, is someone whose response to the associated long-term stability of the region.
While the international community may be reluctant to invest in South America now are the regional leaders had already come to the conclusion that their national interests lie in close cooperation with their neighbors, they are dangerous or not.
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