The Libyan leader planned to meet with the Venezuelan president on Monday and was expected to sign a series of accords to deepen cooperation between their governments.
Chavez and Gadhafi led a weekend summit where South American and African leaders pledged to deepen links between the continents. Chavez made diplomatic inroads while offering African countries Venezuela's help in oil projects, mining and financial assistance.
Gadhafi, who is making his first visit to Latin America, said the two regions should unite to wield more influence and form a defense alliance, a "NATO for the South" - calling it "SATO."
"Those who were betting on NATO, we now say to them that we're going to bet on SATO," Gadhafi said during the summit. "We're going to have our treaty, too."
Chavez, a former army paratroop commander, says the United States poses the greatest potential threat to Venezuela, and has raised the idea of a South Atlantic defense bloc with other allies in the past.
On the economic side, Chavez said Venezuela signed agreements to work together on oil projects with South Africa, Mauritania, Niger, Sudan and Cape Verde. Chavez's government agreed to partner with South Africa's state oil company PetroSA in developing oil fields in Venezuela, and offered to help with oil projects in the other countries.
Venezuela also intends to form joint mining companies with nations including Namibia, Mali, Niger and Mauritania, Chavez said.
It is unclear how much investment and aid Chavez is prepared to offer in Africa since his oil-producing country is coping with a sharp drop in its revenues due to lower world crude prices.
The summit on Venezuela's Margarita Island addressed a wide range of concerns, from hunger in Africa to the economic crisis and a common response to climate change. It also gave Chavez an opportunity to increase his influence in Africa while criticizing U.S. and European influence in poorer nations.
"South-South" cooperation was a buzzword at the summit, which brought together both the African Union and the South American bloc Unasur.
Gadhafi, who has ruled Libya since he seized power in a 1969 coup, has sought a higher profile internationally in recent years and is currently chairman of the African Union.
He criticized the "imperialism" of some wealthy countries, and denounced the U.N. Security Council as an elite club where nations such as Libya have no voice. He called for both regions to unite to demand change in the United Nations - something all the leaders agreed to do in a summit declaration, saying the council should be more "democratic" and "representative."
The Libyan leader said of leading world powers, without mentioning which countries: "They say they face terrorism. They're terrified. ... But they themselves have created the phenomenon."
"In the North, they live in a state of terror as a result of the hatred they've generated," Gadhafi said through an interpreter. He said a larger role for African and South American countries can help restore "equilibrium at the international level."
