MercoPress. South Atlantic News Agency

President Chavez and Mercosur summit stage

The half year Mercosur summit to be held this week in Montevideo, Uruguay, will test the re-vitalized Buenos Aires-Brasilia axis which was the highlight of the recent presidential meeting, next to the Iguazu falls, between Argentina's Nestor Kirchner and Lula da Silva from Brazil.

The main issue in next Thursday/Friday agenda is Venezuela's integration to Mercosur, which is supported by all members, (Argentina, Brazil, Paraguay and Uruguay), but at different "pace".

Another challenging point is the free circulation of goods which means imports would pay an only tariff and in the first Mercosur port of entry, contrary to what happens now.

The summit is also scheduled to approve the first projects to be financed by the Reconversion Structural Fund which has an initial capital of 100 million US dollars and was specifically created to compensate the economic "asymmetries" of the smaller Mercosur members, Paraguay and Uruguay.

Finally there's the proposal to hold summits once a year instead of one each six months.

But Venezuela and its flamboyant president Hugo Chavez, who's arriving Wednesday in Montevideo, will undoubtedly be in the limelight of regional politics.

Fresh from a landslide victory in Sunday's congressional election, but with only a 25% turnout because of the opposition boycott which casts doubts over the legitimacy of the electoral process, Mr. Chavez will be facing two different positions.

On the one side, Brazil which conditions Venezuela's full membership to complying with each and all of the steps demanded for incorporation (a several month process). And if not, the associate member condition such as Chile and Bolivia.

However Argentina would like to see Venezuela's Chavez joining the different bodies and commissions as it advances in the formal integration timetable.

According to Argentine analysts this would ensure an active (political) presence of Venezuela plus the fact it would begin trading with the four full members and would have to accept the common external tariff.

This means privileging Mercosur over other partners and since Venezuela is a member of the Andean Community, which has rules governing associate conditions, it could cause problems.

But Argentina is anxious to have a new Mercosur member that can help counterbalance the overwhelming Brazilian presence.

The host Uruguay, which has excellent political relations with Venezuela and is waiting for promises of trade and financial support to become true, but is also aware of Washington's feelings, has chosen to make the regular block summit into an outstanding event.

Ten presidents, two vice-presidents and delegations from Mexico, Russia, China, Dominican Republic, Israel, Surinam, Guyana, Austria, France and Namibia, plus representatives from Andean Community of Nations, Interamerican Development Bank, European Commission, the Iberoamerican Secretariat, Latinamerican Integration Association, among others have been announced.

The presidents are, Argentinas Nestor Kirchner; Brazil's Lula da Silva; Paraguay's Nicanor Duarte Frutos; Bolivia's Eduardo Rodriguez; Peru's Alejandro Toledo; Chile's Ricardo Lagos and vice presidents from ColÃÂÂ'mbia Francisco Santos and Alejandro Serrano Aguilar from Ecuador.

Mexico will be represented by Foreign Affairs minister Luis Ernesto Derbez; China by Construction Minister Wang Guangtao; Russia, Prime Minister Mijail Yefimovich Fradkov; France, Cooperation and Development minister Brigitte Girardi.