Morales, left, and Chavez, were among the Alba leaders who praised the new currency [AFP]

Leaders from Latin America and the Caribbean have agreed during a summit in Bolivia on creation of a regional currency aimed at reducing the use of the US dollar.

The decision came shortly after members of the Bolivarian Alternative for the Americas (Alba) gathered in the central city of Cochabamba for the start of the two-day summit, the AFP news agency reported.

Top on the agenda for the left-leaning regional trade group, which includes Venezuela, Ecuador and Nicaragua, were talks to implement the new currency, known as the sucre, for use among Alba nations.

"The document is approved," Evo Morales, Bolivia's president and summit host, said on Friday.

Earlier, Hugo Chavez, the Venezuelan president, described the new currency as a "revolution of paradigms".

"The sucre is born in the Alba," Chavez said ahead of the meeting.

"The sucre - an autonomous and sovereign monetary system that will be agreed upon today so that it can be implemented in 2010."

Coup criticism

The Alba leaders were also expected to discuss climate change and trade issues during the summit, as well as renew their criticism of the June coup in Honduras.

The coup forced Manuel Zelaya from office on the same day that he planned to hold a non-binding referendum on changes to the Honduran constitution.

"They have shown their claws again in Honduras and overthrown a legitimate, democratic and progressive government; an ALBA government of the Bolivarian Alliance," Venezuela's Chavez said.

"And they aim for legitimacy before a world community that does not recognise them. The coup in Honduras will be defeated, history will defeat them, they are already defeated."

Zelaya's overthrow was roundly criticised by Latin American countries, including Alba members, and the US.

Talks to resolve the political crisis in Honduras are continuing.