July 8, 2004
Venezuela joins Mercosur trade bloc
(Associated Press, Reproduced by Forbes.com) - "Venezuela joined the growing list of Mercosur 'associate' states as the South American trade bloc also encouraged Mexico to complete free trade talks toward eventual admission.

The announcements made at the 26th summit of the trade body marked a key milestone in the regional growth of the Mercosur bloc, which began as a customs union led by Brazil and Argentina over a decade ago.

Venezuelan President Hugo Chávez lauded his country's acceptance into Mercosur, saying it capped five years of efforts.

'We can now say that Venezuela is part of Mercosur,' said a beaming Chávez just before a final communique by Latin American presidents was issued at the end of a two-day summit in this northeastern Argentine city.

The announcement came hours after Chávez had announced a new strategic oil and energy alliance with Argentina called 'Petrosur'. That declaration, reached on the sidelines of the Mercosur summit, also justify open the door for other Latin American nations to join an energy alliance.

Mercosur was formed in 1991 by nations in southern South America in a bid to ease tariffs and spur commerce. South American powerhouse economies Brazil and Argentina are full members with Paraguay and Uruguay. Peru, Chile and Bolivia have joined as associates in recent years.

In a statement, Mercosur countries said they welcomed Venezuela with 'great satisfaction as the newest member of Mercosur'. They also said they had formally invited Mexico to complete negotiations with Mercosur on a free trade agreement designed to lead to eventual acceptance as an associate member.

Argentine President Nestor Kirchner, who was turning over the six-month rotating Mercosur presidency to Brazil, expressed optimism about Mercosur's growth.

'We appreciate the interest that various countries in Latin America have shown toward incorporating as associate states of Mercosur', said Kirchner, without elaborating further.

Argentine political analyst Rosendo Fraga said the incorporation of new associates within Mercosur follows an inevitable trend toward regional integration that is the result of globalization".