Leaders of the South American trade bloc Mercosur closed a summit in Montevideo yesterday demanding urgent international support for Argentina.
President Jorge Batlle of Uruguay, the current president of Mercosur, told a press conference after the summit the Argentine crisis "will be overcome in full respect to the system of institutional democracy" in the country.
Mercosur groups Brazil, Argentina, Uruguay and Paraguay with associate members Chile and Bolivia.
In the absence of Argentina's outgoing President Fernando de la Rua, the presidents in a statement called for "the attention of the international community and financial organs and institutions so that . . . they lend their co-operation and support to the Republic of Argentina with the urgency that the case requires".
President Fernando Henrique Cardoso of Brazil, President Luis Gonzalez Macchi of Paraguay, President Ricardo Lagos of Chile and President Jorge Quiroga of Bolivia attended along with Mr Batlle, in the absence of Mr de le Rua, who resigned on Thursday.
The Mercosur summit was scaled back as a result of the crisis in Argentina and Mr de la Rua's enforced absence, Mr Batlle explained. "The Mercosur meeting, given the circumstances in Argentina, was a meeting without a formal character."
Argentina is due to take over for the next six months the rotating presidency of Mercosur, a trade bloc which has a combined economic output of over $1.17 billion and more than 230 million people.
"We look forward to the next summit in Argentina as soon as its government deems it opportune," the presidents' statement concluded.
As the presidents met, Argentina's neighbours and trade partners watched anxiously as the country headed for bankruptcy, fearing fallout from the massive debt default.
Brazil, South America's largest economy, said it had yet to feel shock waves from the collapse but officials in other countries predicted that investor confidence in the continent would be undermined.
"A nation in such a predicament poisons the entire neighbourhood," said Colombia's Finance Minister, Mr Juan Manual Santos, "because not only Argentina will be seen as a country with problems, but Latin America will be seen as a continent in difficulty."
President Cardoso of Brazil urged calm, saying Argentina's crisis had not affected the Brazilian economy as badly as feared.
"There is no risk of contamination. Brazil is different, we have no institutional, social or political crisis," Mr Cardoso said.
President Lagos of Chile also counselled calm in his country.
In Paraguay, however, politicians and business leaders feared their country could face a similar economic melt-down. Paraguay is a country "inundated with corruption, impunity, delinquency and unemployment, a veritable kingdom of smugglers, gangsters, drug traffickers, the crooked and corrupt," said Mr Gustavo Volpe, president of the Federation of Production, Industry and Commerce.
Panama's Foreign Minister, Mr Jose Aleman, blamed Argentina's woes on the International Monetary Fund which has been advising Buenos Aires.
"This is a message to all Latin American leaders," Mr Aleman said. "You must stay close to your people and reject formulas from international financial organisations without first adapting them to the reality of your country."
Mexico and Ecuador said they hoped Argentina's troubles could be resolved through democratic means and called on the international community to help Argentina cope with its onerous foreign debt.