Panama City, Panama - Mexican President Vicente Fox (right) listens during the first private session of the Fourth Summit of the Association of Caribbean States, or ACS, in Panama City, yesterday. At centre is Leonel Fernandez, President of the Dominican Republic, and at left is Patrick Manning, Prime Minister of Trinidad and Tobago. (Photo: AP)

July 30 PANAMA CITY, Panama (AP) - The ideological clash that has swept much of South America reached north into the Caribbean, as Cuba and Venezuela led opposition to free trade and market policies yesterday at the Summit of Caribbean States.

Venezuela won praise with offers of oil on easy terms or in exchange for local products, while Cuba offered free medical care as part of efforts to broaden President Hugo Chavez's leftist "Bolivarian Alternative for the Americas".

"Venezuela has given the world, and especially the Caribbean, an example of solidarity and brotherhood," Cuban Vice-President Carlos Lage told the summit of the 25-member Association of Caribbean States, or ACS.
"Venezuela and Cuba have taken the first steps toward the Bolivarian Alternative for the Americas."

He invited the rest of the region to join and offered to provide medical care to 100,000 poor people from the region. "If we integrate the peoples of our countries, we can't be dominated," he said.

Chavez, an outspoken critic of US President George W Bush, has used the name of 19th century South American independence hero Simon Bolivar to describe the vaguely socialist, stridently anti-Washington programme he has championed in Venezuela.

Lage, who was attending in place of Cuban President Fidel Castro, asked a question that has worried many at the two-day summit: "What will poor countries with no oil do when prices reach US$100 per barrel?"

He praised PetroCaribe, Venezuela's plan to offer easy terms - or even accept goods in barter - in return for oil.

Chavez was also absent from the summit, but officials denied that either man feared an assassination attempt in Panama, where Cuban exile Luis Posada Carriles allegedly hatched a plot to kill Castro in 2000.

Lage lashed out at the US war on terror, which he called "a campaign of pillage," and said "the recent terror attacks in Madrid and London prove that you can't defeat terrorism with terrorism."

Chavez's plans drew praise even from President Alvaro Uribe of Colombia, a close US ally, who advocated linking the Caribbean islands with undersea oil pipelines and power lines.

"I can envision Venezuela playing a great leadership role," Uribe said.

Pulling in the opposite direction was Mexican President Vicente Fox, who called for a "strategic alliance" based on free trade and lower investment barriers, and advocated "technology that allows us to leverage growth."

The United States drew praise after the US Congress approved on Wednesday the Central American Free Trade Accord, or CAFTA, which includes Guatemala, El Salvador, Nicaragua, Costa Rica, Honduras and the Dominican Republic.

"I think the step taken yesterday is a historic one. This is a step for Central America toward development, that puts us in the big leagues of trade," said Salvadoran President Tony Saca. "This will mean jobs will be created."

However, many say the United States already dominates trade with the Caribbean too much.

Almost all commerce flows north and south, mainly to the United States, and only about eight per cent of trade is between Caribbean nations, a fact that Panamanian President Martin Torrijos attributed to "historic trends of domination".

Dominican President Leonel Fernandez said "regional integration has all too often been reduced to trade integration," an approach he called "insufficient." Fernandez called rising energy prices "a terrible threat to economic growth" to the largely oil-dependent region and praised Chavez's plan.

Thirteen of the 15 members of the narrower Caribbean Community group, or Caricom - mainly island nations - have already signed onto Venezuela's oil initiative, and similar plans have been launched in South America.

Cuba managed to get a clause condemning the US economic boycott inserted in a draft resolution of the summit declaration, which also stated support for greater representation of developing countries on the UN Security Council.

However, leaders of the 25 member states appeared to have deleted a proposed ban on the transport of radioactive waste through the Caribbean, and softened proposed language on Haiti, where some ACS member countries have refused to recognise the US-backed interim government.