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Honduras joins Venezuelan pact; Chavez promises oil

(L-R) Nicaragua's President Daniel Ortega,Venezuela's President Hugo Chavez, Honduras' President Manuel Zelaya and first lady Xiomara Castro, Cuba's Vice President Carlos Lage and Bolivia's President Evo Morales attend the signing of accession of Honduras to the Bolivarian Alternative for the Americas (ALBA) in Tegucigalpa, August 25, 2008. REUTERS/Edgard Garrido

TEGUCIGALPA (Reuters) - Honduras, long considered an ally of the United States in Central America, joined on Monday a Latin American pact that has been pushed by Venezuela as a way to contain U.S. influence in the region.

Honduras is a member of a free trade pact between Central America and the United States.

But President Manuel Zelaya, a logging magnate seen as a moderate liberal, has been drifting toward closer ties with Venezuela’s President Hugo Chavez, a U.S. foe.

On Monday, Honduras joined the Bolivarian Alternative for the Americas, or ALBA, which is based on complementary trade and cooperation instead of free-market competition.

Venezuela has used the pact and its oil wealth to expand its influence in the impoverished region.

“All the energy that they need ... in Honduras is assured for the next 100 years,” Chavez told a cheering crowd of about 50,000 people in the Honduran capital.

ALBA also includes Cuba, Bolivia, Nicaragua and Dominica.

Honduras was a cold war ally of the United States and allowed U.S.-backed “Contra” rebels from Nicaragua to operate from its soil in the 1980s. Honduras still hosts U.S. troops at one of its military bases.

Coffee-producing Honduras is one of the poorest countries in the Western Hemisphere.

Reporting by Anahi Rama and Gustavo Palencia; editing by Todd Eastham