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Chávez’s Plan for Development Bank Moves Ahead

The idea by Hugo Chávez, Venezuela’s president, to create a Bank of the South to finance regional development projects is moving forward, aided by the tacit approval of Brazil, which has South America’s largest economy.

But doubts persist about the need for such a bank, which many economists and analysts continue to see as a political move by Mr. Chávez to try to spread his influence and carry out his crusade against Washington-based multilateral institutions like the World Bank and the Inter-American Development Bank.

Seven South American countries are expected to inaugurate the new bank at a ceremony on Nov. 3 in Caracas, Venezuela’s capital, where it will be based. At a meeting here earlier this month the countries — Argentina, Brazil, Bolivia, Ecuador, Paraguay, Uruguay and Venezuela — signed off on the idea of creating an institution with up to $7 billion in initial capital, paving the way for the bank to begin operating as early as 2008.

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