Banco del Sur to Start Up in 1H07

Regional development bank Banco del Sur will start up in this year's first half with initial US$7bn paid-in capital, Venezuela's finance minister Rodrigo Cabezas told reporters in Guatemala City on Monday.

Last February, Venezuela's President Hugo Chavez signed an agreement with his Argentine counterpart Nestor Kirchner to launch Banco del Sur within four months.

The bank would finance the Argentina-Bolivia section of the Gran Gasoducto del Sur natural gas pipeline in South America, the two presidents announced in February.

Cabezas said Bolivia and Ecuador have already joined Argentina and Venezuela in technical committees that will begin working in 20 days. The minister also said the bank will look to add Brazil and Paraguay before the official launch.

Chavez has promoted the development bank as a source of cheap credit for countries in the region and an alternative to IMF and World Bank.

Cabezas dismissed rumors the creation of Banco del Sur has sparked concerns among other multilateral financial institutions.

"Banco del Sur will not replace CAF or IDB. It will be a socially committed bank that will deal with the asymmetries in Latin America," he said.

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