Unasur Agreement

The United Nations Economic and Financial Council was established on 12 August 2011 in Buenos Aires at a meeting of finance ministers and central bank representatives from the 12 countries in the region. Argentina`s Deputy Economy Minister Roberto Feletti said the council would consider measures to strengthen regional trade in national currencies without using the dollar. “We have reached an agreement on three areas of work, one of which is to advance multilateral payment mechanisms, maintain trade and protect the volume of reserves,” Feletti said, noting that trade between countries in the region is worth $120 billion a year. “The use of national currencies, without the dollar, protects reserves and increases trade because there are lower transaction rates.” He also presented the plans of the technical groups, which focused on the development and strengthening of development banks such as the Andean Development Corporation (CAF) and the Bank of the South. He said technicians would review the Latin American Reserve Fund (RSF) to give bloc governments greater capacity to respond to speculative attacks on monetary or sovereign debt. [49] South American leaders signed an agreement in 2009 to establish the Bank of the South, a development bank advocated by Venezuelan President Hugo Chavez. The bank, which is based in Caracas, could eventually finance economic development projects in UNASUR member states. In April 2012, Argentina, Bolivia, Ecuador, Uruguay and Venezuela ratified the creation of the Bank. In June 2012, the Secretary General of UNASUR said that the institution would make progress with a regional programme of industrialization and infrastructure construction. A 2010 Americas Quarterly article reported that Argentina, Brazil and Venezuela were committing $6 billion, which is the bulk of the Bank`s original budget of $7 billion.

Some observers expressed doubts about the Bank`s long-term prospects. UNASUR was conceived in a 2004 agreement to promote regional integration by bringing together members of Mercosur and the Andean Community. In May 2008, heads of state and government from 12 South American countries established the UNASUR Constitution Treaty to promote regional economic and political integration. When Uruguay ratified the Charter in December 2010 as a ninth member, the agreement obtained the votes needed to make UNASUR final. The contract came into force in March 2011 at a meeting at the group`s headquarters in Quito, Ecuador. The following parts of South America are or have been territories of non-South American states and therefore do not participate: UNASUR is the successor of the International Community of South America (Comunidad Sudamericana de Naciones; CSN), which was founded when 12 South American leaders signed the Cuzco Declaration in the Peruvian city of Cuzco in 2004.

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