Paraguay 24/01/11

Brazilian government prioritizes agreement with Paraguay over Itaipú dam, while CONARE grants Mario Cossío status of political refugee.

The Brazilian chancellor António Patriota told reporters this week that the Senate’s ratification of the 2009 31-point agreement between Paraguay and Brazil regarding the Itaipú dam will be on top of President Dilma Rousseff’s to-do list.

‘Soon we will be focused [on the Brazilian Senate’s ratification]. I have kept close contact with the Minister of Institutional Relations, who bridges the Executive branch and Congress, in order to give high priority to this approval’, said Patriota after meeting with Paraguayan President Fernando Lugo this Monday.

Inaugurated in 1984, the Itaipú dam is currently the world’s largest producer of hydroelectric energy, reaching world record levels of 93,4 GWh (Gigawatt hours) in 2000. A bi-national power plant shared on a 50/50 basis between Paraguay and Brazil, it sits on the Paraná River, on the border strip linking the city of Foz do Iguaçu in Brazil to Paraguay’s Ciudad del Este.

Although only 10% of the electricity produced is used to fuel Paraguay, that amount provided for 94% of its energy needs in 2000. As a result, the country has long been prone to selling its surpluses from Itaipú to Brazil, a high demand market which consumed the bulk of the dam’s energy to meet only 20% of its needs in the same year.

In 25 July 2009, Paraguay’s President Fernando Lugo and his Brazilian counterpart at the time, Luiz Inácio da Silva met in Asunción for the provision of the joint 31-point agreement regarding Itaipú.

Among the 31 sections of this agreement, Brazil vouched to pay US$360m for Paraguay’s surplus energy, up from the initial US$120m.

The three fold increase was demanded by Paraguay since, as stated by Dr Elena T. Baeza, ‘Brazil is bound by the Treaty [Itaipú Treaty, 1973] to pay market prices for Paraguayan energy.’

Other points included the right held by Paraguay to sell its energy directly to Brazil, rather than through the state-owned energy company Eletrobras (Centrais Elétricas Brasileiras, S.A.).

However, the Brazilian Senate put negotiations on ice by refusing to ratify the agreement when President Lula presented it to the floor.

As a result, the issue has passed on to Dilma’s government, which, according to the Brazilian chancellor, will engage with developing an ‘ambitious agenda’ with Paraguay. ‘I look upon this bilateral relationship with much optimism and enthusiasm’, added the chancellor António Patriota.

In other news, Bolivian suspended governor Mario Cossío was finally granted political asylum by the Paraguayan branch of the Comisión Nacional de Regufiados (National Refugee Council – CONARE). The statesman had been requesting the status of political refugee since he initially fled into Paraguay in December 2010.

Commenting on CONARE’s unanimous decision, Cossío declared he reacted to the news ‘with joy, but also with […] the deepest respect with which [he] would have accepted the opposite decision, because if there is something which characterizes democracy is the respect for the law and for democratic institutions’.