A new immigration law passed by the European Union has provoked an angry backlash at a summit of South American leaders.

The new law could see illegal foreigners being detained for up to 18 months and bars violators from re-entering Europe for five years.

The law is seen as a threat to Latin American economies largely dependent on billions of dollars in overseas remittances.

In a declaration ending a meeting of the Mercosur South American trade bloc in Argentina on Tuesday, leaders condemned what they said was a "shameful" move by the EU.

Hugo Chavez, the Venezuelan president, said the rule to expel illegal immigrants in Europe amounted to a virtual "wall in the Atlantic".

"We need a strong stance ... in defence of the dignity of our people," he told leaders of Brazil, Argentina, Bolivia, Uruguay, and Chile.

"'Civilised' Europe has legalised barbarism," he said.

'Wall of shame'

Chavez said the new EU law was is in stark contrast to moves by South American governments to encourage passport-free travel across 10 nations on the continent.

Comparing the new regulation to the "wall of shame" the US is building along its Mexican border, the Venezuelan leader urged regional leaders to go beyond "just protesting".

"Truly we cannot remain quiet," he said.

The Venezuelan leader suggested "a law of return of all European investment in Latin America" and urged for "a common stance" against both EU and US immigration policies.

His comments were echoed by Tabare Vazquez, the Uruguayan president, who spoke of being the grandson of poor European immigrants.

"It hurts us deeply that there is no respect for the human rights of Latin American immigrants, who had to leave and seek elsewhere what they don't have in their own lands  - just like their grandparents did."

The Mercosur meeting also focused on the global food and energy crisis, noting that member nations have the potential to thrive, since its members include major energy and food exporters.

Brazil is the world's largest producer of sugar and of cane sugar ethanol, and second in soy while Argentina, also an important soy grower, is the world's second biggest corn producer and the fourth in wheat.