It is Ahmadinejad's second visit to Venezuela in the past five months, and the two leaders were scheduled to talk about strengthening their economic ties. From here, the Iranian president is to visit Ecuador and Nicaragua, where leftist presidents aligned with Chavez are being sworn in this month.

Venezuela's government promoted the visit as an example of Middle Eastern solidarity with Chavez's opposition to U.S. foreign policy.

Venezuela has vociferously defended Iran as the United States steps up efforts to circumscribe Ahmadinejad's government, most recently through a military raid last week that netted five suspected Iranian operatives in Iraq.

State television here showed images of Chavez embracing Ahmadinejad and of Iranian cars rolling off an assembly line at a recently opened factory in the city of Maracay. Fifty cadets from Venezuela's naval academy were on hand to receive the Iranian president at the international airport in Maiquetia.

The two leaders also said they would use a $2 billion investment fund to finance projects in Venezuela, Iran, and other countries. In addition, they said they were considering ventures to train teachers and produce manioc starch in Venezuela. Ch?vez also said Venezuela and Iran would press for exporting cuts within OPEC in an effort to push oil prices up from a 19-month low.

Nowhere has Iran's search for allies in Latin America been more fruitful than in Venezuela. The two countries have signed an array of agreements in recent months, pledging to work together here in oil exploration, building low-income housing and assembling tractors and bicycles, among dozens of other ventures.

The tightening alliance with Iran comes as Chavez pushes for broad changes in Venezuela's political and economic structures. Last week, Chavez's government said it would nationalize the electricity industry and the country's largest phone company.

Ahmadinejad's visit has alarmed Jewish organizations, which are concerned about the Iranian president's aggressive talk in relation to Israel. Heinz Sonntag, a Venezuelan sociologist and political commentator, said the visit by Ahmadinejad was an "affront and an eventual threat to our fellow countrymen who are Jewish." International Herald Tribune