HAVANA, Cuba (AP) – Venezuelan President Hugo Chavez and Cuba’s interim leader, Raul Castro, oversaw the signing yesterday of economic partnerships in areas ranging from oil production to tourism as the nations moved to further integrate their economies.

Cuba and Venezuela, Washington’s two strongest critics in Latin America, are strengthening their ties under the Boliviarian Alternative for the Americas regional trade pact, said the 76-year-old Castro, who has led Cuba during his 81-year-old brother Fidel’s extended illness.

Venezuela and Cuba “can form a confederation of republics, two republics in one, two countries in one,” said Chavez, whose weekend visit included a meeting with his friend and ally Fidel Castro and an hourlong chat Sunday while hosting his weekly live television and radio show from the central city of Santa Clara.

Chavez has championed his Bolivarian trade agreement, which counts Cuba, Bolivia and Nicaragua as signatories, as an alternative to US free trade pacts.

Castro appeared somewhat frail, but alert and in good spirits in a videotape release of the Saturday meeting. Castro sounded animated during his hourlong telephone chat with Chavez on his Alo, Presidente! programme, marking the first time the ailing Cuban leader had spoken live in a broadcast on the island since falling ill.

US State Department spokesman, Tom Casey, yesterday commented sarcastically that he was “delighted that Fidel Castro has had an opportunity to discuss things with his good friend President Chavez”.

“It’s too bad that in almost half a century of misrule in Cuba, he’s never had the same conversation with his own people,” Casey said.

Among other agreements, Cuba and Venezuela also agreed to explore creating joint cement and mortar production plants, mining and other energy projects and even a five-star hotel.

Trade between the two nations has burgeoned in recent years under the close alliance formed by Chavez and the elder Castro.

Venezuela currently sells Cuba 90,000 barrels of crude daily under highly preferential terms, and overall trade between the countries is expected to reach US$1.3 billion this year.