Iran and Venezuela on Friday inaugurated a joint bank to finance their development projects, during a visit by Venezuelan President Hugo Chavez to Tehran, state media reported.

The Iran-Venezuela bank, based in Tehran, has an initial capital base of 200 million dollars, with each nation providing half of the funds, the state broadcaster said.
Half the initial capital of the bank will be financed by Iran and the remaining half by Venezuela.

Venezuelan President Hugo and Iranian President Mahmoud Ahmadinejad attended the opening ceremony.

Iran's ministers of economic affairs and finance and foreign affairs were present at the inaugural ceremony.

The creation of the bank was announced in May 2008, following up on an agreement which the two countries signed in March 2007.

Chavez met Iranian President Mahmoud Ahmadinejad in Tehran before the two leaders inaugurate a joint development bank tomorrow with $200 million in starting capital.

Chavez is on a tour of the Middle East and Asia this week, seeking to bolster economic ties and secure funding for oil projects. Iran and Venezuela are also studying the possibility of building two jointly owned refineries, Venezuelan Basic Industries Minister Rodolfo Sanz said, according to an e-mailed statement.

Venezuela, the fourth-biggest supplier of oil to the U.S., is courting China and Japan to land billions of dollars in energy investments, Oil and Energy Minister Rafael Ramirez said March 13.

The South American country needs $12 billion to develop natural-gas resources and $6 billion for Orinoco belt oilfields, the minister said.

Agencies