Bank of the South

Second open letter to the Presidents of Argentina, Bolivia, Brazil, Ecuador, Paraguay, Uruguay and Venezuela

7 December 2007


Dear Mr. Presidents,

We are addressing you for the second time to express the high expectations created in our peoples on the initiative to establish a Bank of the South. We are also encouraged by the positive response of other countries of South America who have manifested their wish to participate in the Bank of the South.

Signatories are from social networks, organizations and movements, labour unions and professionals who are fighting against the scourge of illegitimate public debt and the twisted policies and practices of the existing international financial institutions and the current global trade system. We are sure that the decision to establish a Bank of the South can be a significant big step and an opportunity not only for South America, but for the whole of Latin America and the Caribbean, as also other regions of the Southern Hemisphere.

We come from a recent history of struggle against dictatorships in almost the whole continent. This explains our determination to open and institute new spaces for participation and direct democracy. However, the not very transparent and non participative way in which the negotiations on the establishment of the Bank of the South are being carried forward, without public debate and without consultation with our societies, can indicate that we are facing something that could turn out to be more of the same.

It is our conviction that a new South-South financial entity should be focused not only on going beyond the negative experiences of economic opening , with always the same consequence of higher indebtedness and capital drainage, deregulation and privatization of the public patrimony and basic services suffered by the region; but also beyond the well-known non-democratic, non-transparent , regressive and discredited behaviour of multilateral bodies such as the World Bank World Bank
The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

, the CAF, the IADB and the IMF IMF
International Monetary Fund
Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.
. Our recent history has shown that the latter’s choice of economic, social, and environmental policies imposed on our governments through conditionalities, have ended in the decapitalization and deindustrialization of the region’s economies, and have imprisoned these in the agro-mineral-exporter model that stops their development and deepens their subordination to the North economies, while worsening social inequity, ecological damage and the “eternal” financial, historic, social, cultural, and ecological debts.

Knowing how important it is for the countries involved in the establishment of the Bank of the South to reach an agreement upon key issues related to its nature and objectives, and its financial and operational structure, we think it is essential for us to pose the following proposals that express the aspirations of ample sectors of our countries’ societies, according to what was clearly manifested by their main representatives consulted:

1. That the focus of the Bank of the South should be in promoting a new development framework whose essential values be the sovereignty of our peoples on their territory and their own development; a responsible self-determination on our economic, social, and environmental policies; on solidarity, sustainability, and ecological justice; that for the Bank economic and technological development be conceived as a means for the superior goal which is human and social development.

2. That the action of the Bank of the South be guided by concrete goals such as full employment with dignity, ensuring food, heath and housing, universalization of basic public and free education, a redistribution of riches overcoming inequity, even gender and ethnic ones, reducing greenhouse effect gases and their effects on the continent’s population and the other peoples of the south.

3. That the Bank of the South be an integral part of a new Latin-American and Caribbean financial architecture which includes a South Fund with the functions of a Continental Central Bank Central Bank The establishment which in a given State is in charge of issuing bank notes and controlling the volume of currency and credit. In France, it is the Banque de France which assumes this role under the auspices of the European Central Bank (see ECB) while in the UK it is the Bank of England.

capable of articulating a great continental payment system with a state of the art telematics platform; capable of linking the policies which promote macroeconomic stability with development and reduction of structural asymmetries policies; and which considers a development in the future of a common monetary system at the service of a strategy which strengthens economic and commercial ties within the region, introducing trade interchange with national currencies, and working towards the establishment of a regional currency at least for intraregional interchanges. The building of a space for supranational monetary and financial sovereignty demands a lot of local flexibility to avoid sub imperialist temptations, and the victory of monetarist orthodoxy in some aspects as those in recent the European experience.

.4. That the Bank of the South be useful to recover the values related to historic, social and ecological debts of which our peoples are creditors. That its financing be oriented towards going beyond the social asymmetries and inequities, and the ecological damage perpetrated in the continent for more the five centuries.

5. That the Bank of the South consider the participation of citizen organizations and social movements, no only in the development of its original architecture but also in financial and operational decision making, and in the monitoring of the use given to the funds awarded.

6. That the Bank of the South implements its management in an egalitarian way among its member countries, instituting and keeping the egalitarian principle of “one associate one vote” in all levels of collegiate decisions, and that it aspires to channel regional savings in the region.

7. That capital subscriptions of the Bank of the South be proportional to the capability of the economy of its member countries; that other sources of capitalization may include part of international reserves and loans from member countries, global taxes and donations. Financial resources from the present multilateral financial institutions and from states that have plundered our continent should be excluded. That these dispositions of the Bank of the South may allow an increasing growth in putting member countries’ reserves out of the sphere of the dollar and the euro, and encourage the return of national capitals deposited abroad.

8. That the Bank of the South be committed to transparency in its administration, settling public account for its functioning and activities, submitting to permanent external audits of its loans and its internal functioning with social participation.

9. For the Bank of the South not to become “more of the same”, the quality, austerity and management efficiency must be permanently evaluated, forbidding any kind of immunity privileges to its officials, and based on the maximum in time transparent reporting, and the democratic and social control of its management. To avoid excessive expenditures and bureaucratic deviations a small body of simultaneously diversified, efficient, effective and managerially polyvalent officials must be designated.

.10. That the loans be destined to the promotion of a genuinely cooperative regional integration, based on principles such as active subsidiarity, proportionality and complementarities; financing of public investment projects; paying attention to self-managing local development, and promoting equitable and solidarity commercial exchanges between family farmers, small producers, the cooperative sector and social solidarity economy, indigenous and traditional communities and women’s, fishermen’s, workers’, identity etc. socioeconomic organizations.

11. That the Bank of the South adopts as investment priority those projects oriented towards food and energy sovereignty; research and development of appropriate technologies for an endogenous and sustainable development of the region, including free software; the programmed and complementary production of generic medicines; the recovery of ancestral wisdom, systematized and accepted as an agro ecologic science; the promotion of environmental justice; the improvement of public services: support to victims of forced displacements; promotion of communications and intraregional culture; the creation of a University of the South and an equivalence system for diplomas issued in all the region: infrastructure starting from other logics of space organization instrumented by communities for local solidarity and self-management development. That the bank should not reproduce the financing model of present day international financial institutions with the construction of mega-projects that damage the environment and biodiversity.

12. The Bank of the South must be considered an essential tool for the custody and channelling of savings, breaking the repeated cycles of collection of the national and regional efforts through manœuvres and suspicious deals with indebtedness and public titles, subsidies to privileged and/or corrupted private local and international economic and financial groups, and a permanent guarantee to the speculative movements of capital entry and outflow.

We understand that all the above is in keeping with what was emphasized in the Ministerial Statement of Quito, on May 8, pointing that: “The peoples have given their governments the mandate to provide the region with new instruments of integration for development which must be based on a democratic, transparent, participative, and accountable to their citizens’ design”.

We are worried about the postponements in the signature of the founding act, which could indicate the existence of significant unresolved issues. We hope that in the negotiations to overcome these unresolved issues, the proposals presented in this setter will be taken into account.

The current regional and international economic and financial situation is still favourable to give concrete steps in this direction, but it may not last. We trust in that you will take advantage of this historic possibility to create what could turn into a real Solidarity Bank of the peoples of the South.

Yours sincerely,

November 2007

Sign up writing to Jubilé Sud - Américas : jubileosur at
and Jorge Marchini : jorgemarchini at



Regionals :

Alianza Social Continental (ASC)
Consejo Latinoamericano de las Ciencias Sociales (CLACSO)
Convergencia de Movimientos Populares de América (COMPA)
Grito de los Excluidos/as Mesoamericano.
Jubileo Sur/Américas
Justicia, Paz e Integridad de la Creación (JUPIC)
Observatorio Internacional de la Deuda en América Latina (OID)
Organización Caribeña y Latinoamericana de Estudiantes (OCLAE)
Programa de Incidencia sobre Deuda Externa Ilegítima, Federación Luterana Mundial
Red latinoamericana sobre Deuda, Derechos Humanos y Desarrollo (LATINDADD)
Red Solidaria por los Derechos Humanos REDH
Servicio Paz y Justicia en América Latina (SERPAJ-AL)
Sociedad Latinoamericana de Economía Política (SEPLA)


Convocatoria No al CIADI, Sí a la Soberanía
Diálogo 2000
Espacio No-Deuda; Federación Judicial Argentina (FJA)
Mate Amargo
Museo Che Guevara
Movimiento por la Paz, la Soberanía y la Solidaridad (MOPASSOL)
Multisectorial de Solidaridad con Cuba
Movimiento por la Soberanía y la Integración de los Pueblos (MoSIP)
MoSIP- Lanús; Periódico El Espejo
Red de Mujeres y Minería
El grito de los excluidos
Movimiento Boliviano por la Soberanía y la Integración Solidaria de los Pueblos
Brazil :
Red Jubileu Sul Brasil
Rede Social de Justiça e Direitos Humanos
Rede Brasil sobre Instituciones Financieras Multilaterales
Esplar, Centro de Pesquisa e Assessoria
Sodireitos - Sociedade de Defesa dos Direitos Sexuais na Amazônia
Enquanto E-Changer/Brasil
Fórum de Mulheres da Amazônia Paraense – FMAP
FASE/AM (Federação de Órgãos para Assistência Social e Educacional)
Fórum da Amazônia Oriental – FAOR
Centro Acadêmico Josué de Castro
Common Frontiers
Federación de Prosumidores Agroecológicos "agrosolidaria”; Kihili zafra kunturpillku khamaqshiani
REMTE- Red Latino-americana de Mujeres Trasnfomrando la Economia
Centro Memorial Martin Luther King Jr.
OCLAE; Jubileo 2000-Red Guayaquil
Grupo Nacional de la Deuda
Andres Mendoza Reynoso Proyecto Comunitario Bastion Popular
El Salvador:
Red de Acción Ciudadana frente al Comercio e Inversión, SINTI TECHAN
Mesa Global
Bloque Popular
Coordinadora Nacional de Resistencia Popular
Centro de Estudios Internacionales
Iniciativa Paraguaya por la Integración de los Pueblos - Capítulo Paraguayo de la ASC
SOBREVIVENCIA/Amigos de la Tierra
Marcha Mundial de Mujeres
Cátedra sobre Desarrollo Humano Hernán Méndez Castellano, de la UCV
FSBT, Fuerza Socialista Bolivariana de los Trabajadores/as; Movimiento de Trabajadores "Alfredo Maneiro”
Nuevo Sur SUDACA
Coalición de Tendencias Clasistas
Manuelita Sáenz (MOMUMAS)

Other parts of the world signatures:

Comité por la Abolición de la Deuda del Tercer Mundo (CADTM)
Jubilee South
Noviolencia International, Washington, DC, Estados Unidos
International NGO Forum on Indonesian Development
Migrant CARE Care Le concept de « care work » (travail de soin) fait référence à un ensemble de pratiques matérielles et psychologiques destinées à apporter une réponse concrète aux besoins des autres et d’une communauté (dont des écosystèmes). On préfère le concept de care à celui de travail « domestique » ou de « reproduction » car il intègre les dimensions émotionnelles et psychologiques (charge mentale, affection, soutien), et il ne se limite pas aux aspects « privés » et gratuit en englobant également les activités rémunérées nécessaires à la reproduction de la vie humaine. Jakarta Indonesia
FODEX, República Democrática del Gongo
Indian Social Action Forum (INSAF), India
Alianza Internacional de los Habitantes
Asociación A Sud – ITALIA
India - World Bank Tribunal’ network., India
CADTM Senegal
CADTM Francia
CADTM Lubumbashi (RD Congo)
APASH Congo Brazzaville
RNDD Níger
VAK India
CADTM Pakistan
ATTAC Morocco
AGAS Siria
CAD Mali

 Individuals signatures:

Laura Interlandi, Argentina
Pedro Peretti, Secretario adj coprofam, Secretario RRII FAA, Argentina
Cristina Castello Poeta y periodista, Argentina
Antognazzi Irma. Directora del Grupo de Trabajo Hacer la Historia. Argentina
Raquel Abourachid, Argentina
Rev. Fred Morris, Presidente Companheir@s da Fe das Americas, Chile
Marta Harnecker, escritora, Chile
Jesuita Pedro Marchetti, Honduras
Andrés Thomas Conteris - Director, Programa de las Américas
Noviolencia International, Washington, DC
Julio Escalona, cordinador Cátedra sobre Desarrollo Humano Hernán Méndez Castellano, de la UCV , Venezuela
Luis Guilhermo Pérez - FIDH (Federação Internacional de Direitos
Socorro Damasceno - Sindsaúde (Sindicato dos Trabalhadores em Saúde) – Brasil
Walter Baior – Transtorm, Brasil
Joana P. E. - FEPS/PA (Fórum de Economia Popular Solidária, Brasil.
Socorro Pereira – ASWOP, Brasil
Maria Luisa Mendonça - Rede Social de Justiça e Direitos Humanos. Brasil
Nasir Mansoor - CADTM (Comitê pela Anulação da Dívida do Terceiro Mundo) Pakistan
Bonfond Olivier - CADTM (Comité por Anulaión de la Deuda del Tercer Mundo) Bélgica
Jean Michel Aupoint - UTG (União dos Trabalhadores Guianenses) y OGDH (Organisation Guinéenne des Droits de l’Homme) Brasil
Joel Suárez - CMMLK (Centro Memorial Martin Luther King Jr.) Cuba
Cândido Grzybowski, Instituto Brasileiro de Análises Sociais Económicas, Brasil
Hector de la Cueva - RMALC/ASC
Dário Bossi -Missionários Colombianos, Colombia
Roseli Macedo Silva - CMP (Central dos Movimentos Populares) Brasil
José Paulo Guedes Pinto - ATTAC Brasil
Antonia Soares Salgado - Marcha Mundial das Mulheres – Brasil
Maria Luiza de Carvalho Nunes - Centro de Estudos e Defesa do Negro no Pará-Brasil
Atilio A. Boron, , Argentina
Dr. Carlos Marichal, Mejico
Eduardo Letelier, Cetsur, Chile
Andres Mendoza Reynoso Proyecto Comunitario Bastion Popular, Ecuador
Jorge Castañeda Zavala, Instituto de Investigaciones Dr. J. M. Luís Mora, México D.F.
Pedro Marchetti, S.J.Instituto Centroamericano de Espiritualidad
Juan A. Krzanowski, Argentina
Eduardo Letelier Economista CETSUR, Chile
Diego Castellanos (Venezuela) ex- Presidente del Banco Central de Venezuela
Eric Toussaint (Bélgica) Doctor en Historia. Presidente del Comité por la Abolición de la Deuda Externa (CADTM)
Jorge Marchini ( Argentina) Profesor Titular de Economía (UBA), Coordinador del Observatorio Internacional de la Deuda (OID)
François Houtart, prof. em. d l´Universite Catholique de Louvain
Maria Alice de Paula Santos (Brasil)– Fórum Estadual de Educação de Jovens e Adultos
Meriem Choukroun ( Argentina)- periodista
Eduardo Lucita (Argentina). EDI-Economistas de Izquierda, Revista Cuadernos del Sur
Daniel Baigorria (Argentina) Docente de Economía (UBA)
Eric Berr, economista, Francia
Alexander Buzgalin, prof universidad Moscu, Alternativy




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