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Article

19 Aug 2019

Author:
America's Quarterly

Paraguay: Leaked Itaipú dam agreements and negotiations with Brazil spawn political crisis

“Why Has Energy Spawned a Political Crisis in Paraguay?”-14 August 2019

…A secretive deal brought Paraguay’s president dangerously close to impeachment – and risks splattering into Brazil…The unfolding scandal centers on the vast Itaipú dam. Bridging the Paraná River between Paraguay and Brazil, the shared hydroelectric facility was built by the countries’ military dictatorships in the 1970s following a border crisis. Its construction was mired in allegations of billions of dollars in kickbacks, the murder of an ambassador and the mass eviction of indigenous communities…This chord was hammered in late July, with the leak of an agreement concerning Itaipú signed on May 24 between both countries’ diplomats that would have landed Paraguay’s state electricity firm ANDE with a deficit of some $250 million and signaled substantial energy rate hikes…senators of a faction from Abdo’s Colorado party loyal to former President Horacio Cartes (2013-18) threw their weight behind impeachment. Throwing Abdo a lifeline, Bolsonaro agreed to cancel the deal. Then, early on Aug. 1, the Cartes camp stepped back from impeachment…In total, the crisis has forced the resignation of eight officials (and counting) and left Abdo fighting for his political life...Abdo named an advisory council to help shape Paraguay’s approach to renegotiating the Itaipú terms in 2023, though its powers and resources are unclear…“The only guarantee that Itaipú works for the development of the country is an informed, awake and mobilized population,” argued Angeles Ferreira, a campaigner and social science professor…