(AP)
Updated: 2007-08-27 09:45

Most of the funding - $6.3 billion - involves energy projects, some of which directly benefit Venezuela's oil industry, such as a $3.5 billion refinery to be built in Nicaragua. That also includes funding for electricity plants in Haiti and Bolivia, and an estimated $1.6 billion in fuel financing to at least 17 nations.

Venezuela has pledged $772 million in development aid, including AIDS treatment in Nicaragua, housing in Dominica and Cuban doctors in Haiti.

In Bolivia, $20 million went directly to mayors selected by leftist President Evo Morales for projects including health clinics and schools. Mayor Miguel Avila gratefully accepted a $427,000 check for his town of San Lorenzo to build a new farmers' market.

Critics warn that scant oversight leads to waste and corruption.

"You don't do things well by just giving money away," said Liliana Rojas-Suarez, a former IMF economist at the Washington-based Center for Global Development. "If you give money without any conditions attached, without any expectations, without anything, what are the incentives?"

But Mark Weisbrot of the Center for Economic Policy Research says Chavez has succeeded in providing more financing options and breaking up a "creditors' cartel" of Washington-based lenders whose economic prescriptions failed to improve the lives of the poor.

Chavez helped Argentina pay off its IMF debt by buying some $5.1 billion in Argentine bonds in recent years, and now proposes a "Bank of the South" that would use billions from Venezuela's international reserves as seed money.

Meanwhile, Venezuela's state development bank, Bandes, is expanding into Bolivia, Uruguay, Honduras, Guatemala and Haiti. In Nicaragua, it is offering loans at just 5 percent interest, compared to 35 percent by some private banks.

Nicaraguan farmer Juan Vicente Castillo, whose cooperative plans to grow black beans to pay off part of a $750,000 Bandes loan, says: "We are very grateful to President Chavez's government for this loan that the commercial banks wouldn't give."

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