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Bank of the South: ‘We’re Almost There’
On November 3, Venezuela, Argentina, Brazil, Ecuador, Bolivia, Paraguay and Uruguay could be formally founding the Bank of the South, an initiative that will release them from the discredited financial international institutions and the onerous conditions these have used to subdue Third World countries.
The preliminary meeting now taking place in Rio de Janeiro, with the participation of the ministers of Finance and Economy of the member nations, means that the founding of the bank is imminent, despite necessary adjustments that had delayed it.
The good news is that Brazil, a country which was not sure about joining the bank, has finally agreed to be part of a project that was immediately welcomed by Argentina, Bolivia and Ecuador. Such decisions were probably motivated by the crisis undergone in Argentina, due to the quick-fix structural adjustment formulas demanded by the IMF. Likewise, perhaps because of his having been the minister of the Economy, President Correa of Ecuador is well aware of what the institutions born out of Bretton Woods are capable of.
While the founding institutionals are being shaped, information has been learned about some of the agreements from the meeting . For example, the head office will be in Caracas, with local offices in Buenos Aires (Argentina) and La Paz (Bolivia). However, the most important fact about the bank is the objective of supporting projects aimed at the social and economic development of South American countries, as well as helping them in crises that could eventually take place. That is why some have described it as an institution to promote development in the region.
This initiative is the result of the situation the world faces today. The consolidation of the project takes place following the implementation of disastrous neo-liberal policies that made evident the hegemonic role of IMF and the WB, and at a time when Latin America countries are recovering their national sovereignty. How many countries would trust those organization’s loans today?
At the same time, the Bank of the South has been inspired by co-operation initiatives implemented in the region. An eloquent example is the way this common fund is going to be established. According to information leaked from the meeting, each country will contribute 10 percent of their reserves. This means that contributions will depend on the resources of each country, something that could be interpreted as the first regional decision to take into account the differences between nations, asking each country to co-operate with what they can give.
Although final decisions remain pending on a few elements, this seems to be a done deal – another step toward real continental independence.
From the Cuban youth magazine Juventud Rebelde.
Thanks to Walter Lippmann for locating this article.