South America Leaders Propose Haiti Aid, Avoid Strife (Update4)

Feb. 9 (Bloomberg) -- South American leaders agreed to provide $300 million in aid to Haiti at a summit in Ecuador after skirting regional disputes that have undermined relations on the continent since 2008.

The 12 members of the Union of South American Nations, or Unasur, endorsed an accord today calling for a $100 million fund as well as a credit of up to $200 million from the Inter- American Development Bank. The money would be channeled to programs benefiting Haiti’s reconstruction in areas such as agriculture, electricity infrastructure, health and education.

“Latin America has stood up,” Ecuadorean President Rafael Correa said, addressing the summit at his presidential palace. “The time has come to create a new kind of south-south aid.”

The meeting marks Colombian President Alvaro Uribe’s first visit to Ecuador since his armed forces staged a cross-border raid on a guerrilla camp there almost two years ago. The attack killed rebel leader Raul Reyes, prompted Correa to break off ties with his northern neighbor and led Venezuela’s Hugo Chavez to order tanks to his country’s border with Colombia.

“This show of solidarity with Haiti will allow our differences to be overcome,” Correa told reporters after the summit.

Leaders including Organization of American States Secretary General Jose Miguel Insulza said aid efforts should follow instructions from the government of Haitian President Rene Preval. Preval told reporters after the summit that he was “extremely satisfied” with the accord, which calls for member nations to scrap tariffs on Haitian imports.

IDB Support

Correa also said Unasur countries should consider subsidizing natural gas exports to the Caribbean nation, and that more concrete commitments, including financing details, would be hammered out at a summit of the Rio Group nations later this month in Cancun.

Carlos Melo, the IDB’s representative in Ecuador, said he spoke to bank chief Luis Alberto Moreno, who supported a 15- to 20-year “preferential” credit to be taken on by Unasur. Correa said member countries should consider contributing 25 cents per inhabitant to the $100 million fund.

Chavez canceled his attendance because of an electricity crisis he’s facing at home, Ecuadorean Foreign Minister Ricardo Patino told reporters today. At a gathering in Argentina last August, Chavez assailed a deal allowing the U.S. access to seven Colombian military bases, saying it was part of a strategy to dominate the region.

Regional Integration

About 100 protesters gathered today outside the presidential palace, carrying signs reading “Uribe equals the threat of war” and chanting criticisms of Correa for receiving his Colombian counterpart.

Unasur was formed two years ago in a bid to promote regional integration. In 2008, at a summit in Santiago, the group provided political backing to Bolivian President Evo Morales after clashes between his supporters and government opponents over a new constitution left 30 people dead.

The leaders of the continent’s two biggest economies skipped today’s talks. Argentine President Cristina Fernandez de Kirchner has canceled foreign travel amid a political dispute over control of the central bank’s reserves.

Brazilian President Luiz Inacio Lula da Silva didn’t attend because of conflicts in his agenda, according to his press office. He sent his top foreign policy adviser, Marco Aurelio Garcia, to represent him.

Brazil Aid

Unasur countries rushed doctors, food and emergency supplies to Haiti, the hemisphere’s poorest country, in the aftermath of the Jan. 12 earthquake. At least 200,000 people died in the quake, Haiti’s government said Feb. 6.

Lula signed a decree Jan. 26 providing 375 million reais ($200 million) in aid to Haiti. Brazil, which leads a United Nations peacekeeping contingent in Haiti, had already pledged about $17 million to the country, the most among Latin American nations, according to UN data.

Venezuela forgave Haiti’s oil-related debt and donated 225,000 barrels of fuel, while Colombia sent more than 200 search-and-rescue personnel and committed hundreds of tons of humanitarian supplies. Ecuador has sent rescue teams and donated several tons of food, UN data show. Peruvian President Alan Garcia, speaking at the summit today, said Peru was willing to contribute $10 million.

Correa, speaking to reporters after the meeting, said Ecuador “can’t forget” Colombia’s March 2008 raid. Still, he said his government will “try to normalize relations as quickly as possible” with its “brother nation.”

Diplomatic Relations

Colombia and Ecuador began taking steps late last year to restore full relations. The neighbors named diplomatic envoys and re-established military ties in November. Ecuador this month also eliminated the last of the tariffs it imposed on Colombian goods in 2009.

“It’s a sign of progress in overcoming the difficulties that emerged from the March 2008 incursion,” said Peter DeShazo, director of the Americas program at the Center for Strategic and International Studies in Washington.

Still, DeShazo said, “as relations improve between Ecuador and Colombia, all that does is show that the relationship between Venezuela and Colombia remains a real sore point.”

To contact the reporter on this story: Alexander Cuadros in Quito at acuadros@bloomberg.net