DOHA - South American and Arab leaders on Tuesday sought to forge a common alliance to confront the global financial crisis on the eve of the Group of 20 summit of industrialised nations.

Ahead of Thursday's G-20 forum in London, leaders of the 22-member Arab League and 12 South American states staged their second summit in four years in the Qatari capital, Doha, aiming to create united political and economic fronts.

Prime Minister Nader Dahabi, who returned to Amman later yesterday, chaired the Jordanian delegation which included Foreign Minister Nasser Judeh and other officials.

At the opening of the summit, Emir of Qatar Sheikh Hamad Ben Khalifa Al Thani said the Latin American and Arab worlds face similar challenges, underlining the need to foster inter-regional ties, particularly in light of the current global financial crisis.

Brazilian President Luiz Inacio Lula da Silva said: "The world will follow carefully to see if South America and the Arab countries are capable of taking measures to prevent the financial crisis from becoming a social and political earthquake."

South American and Arab leaders seek to bolster their economic ties, buoyed by the fact that trade between them has almost tripled to around $18 billion since their first summit in Brasilia in 2005.

Leaders also hope to make progress towards forming an economic partnership and a political alliance in global institutions, diplomats said.

South America and the Arab region are geographically far apart, but each contains a major oil producer, with Venezuela and Saudi Arabia among the world's top exporters.

Venezuelan President Hugo Chavez sought Arab support Tuesday for a proposed oil-backed currency to challenge the US dollar in his latest swipe at Washington's dominance in global financial affairs.

Regional issues, such as deadlocked Israeli-Palestinian peace talks and the international arrest warrant facing Sudanese President Omar Bashir for alleged war crimes in Darfur, were also raised by South American leaders.

The warrant, issued on March 4 by the International Criminal Court, is "a judicial horror and a disrespect to the people of the Third World", Chavez told reporters.

"Why don't they order the arrest of [former US president George W.] Bush, why don't they order the arrest of the Israeli President [Shimon Peres]?" he asked.

Lula urged the incoming Israeli government under Benjamin Netanyahu to resume peace talks with the Palestinians, leading to the creation of an independent Palestinian state.

"It is important for the new government in Israel to commit itself firmly to the peace process and respect peace agreements previously reached," he said.

Business leaders meet

In a meeting on the sidelines of the summit, Arab and Latin American businesspeople recommended yesterday the establishment of an Arab-South American bank to help finance projects in their countries, especially in light of the current global economic downturn.

They called for establishing regular maritime and air transportation routes to facilitate transportation of goods and people and to stimulate bilateral ties.

The Arab and Latin American businesspeople underlined the importance of the removal of tariff and non-tariff barriers and said it was important to organise trade fairs to introduce both regions’ products and features.

The business leaders said it was in the interest of both sides to boost trade volume between the two regions, which they said was below desired levels despite recent increases.

Emphasising the need to promote the establishment of a general union for the Arab and South American chambers of commerce, the businesspeople said it was important to facilitate the issuance of visas to businesspeople from both sides.