Argentina's throttling of Paraguay's economy

Argentinaís customs barriers control Paraguayan exports.

President Cristina Kirchner of Argentina.

At a time when Paraguay voted in favor of Argentina to join the UN Security Council, the administration of Cristina Kirchner violates treaties and international laws which specify the status of products that are in transit. According to international agreements, Paraguayan products that are in transit through the Port of Buenos Aires, should not be examined by its customs check point. In addition to these obstacles, Argentina owes to Paraguay more than USD 193 million from the purchase of electrical energy at Yacyreta Hydroelectric Dam.

On November 2nd, the Customs of Argentinean Government in Buenos Aires informed Paraguayan river transportation companies that they will inspect all containers originated from Asuncion and destined to international markets. This new measure will further complicate and elevate the obstacles for Paraguayan products in International Markets. Paraguayan ship owners have rejected this new measure by Argentinian government. These procedures will cause a delay and crash the Paraguayan businesses that ship their products through the port of Buenos Aires.

Paraguayan president, Federico Franco, has expressed his concern and at a press conference in e Department of Cordillera assured the public that “Paraguay will defend its sovereignty, file a note of protest to appropriate international organizations and make sure to defend our national sovereignty.”

These verification procedures will enable Argentinean customs to open the Paraguayan containers in Buenos Aires, unload its contents and even destroy the security seals at every container, therefore will tamper all commodities coming from Asuncion in transit through Rio de la Plata.

According to the president of the Center of Maritime Ship-owners of Paraguay (CAFyM), Guillermo Ehrecke: “this situation is totally unusual, but coming from Argentina, it is not a surprise to Paraguayans”

Mr. Ehrecke said that this measure violates international treaties and agreements, in which is clearly established that the goods in transit from one country to another cannot be checked at ports where the goods are in transit. These non-sense measures will cause an additional expense of USD 800 – 1,000 dollars/container to Paraguayan exporters.

On November 2nd, I contacted three times by phone the Embassy of Argentina and no one was available to comment on the current situation caused by Argentinean Customs’ services. It is evident that Kirchner wants Paraguay to become another province of Argentina. Buenos Aires’ current measures will elevate the sense of nationhood amongst Paraguayans and Kirchner’s actions will certainly backfire sooner or later.

With current blocking measures against Paraguayan exports, President Kirchner wants to harm the Paraguayan economy and reduce its impressive level of growth, which Argentina envies and is certainly far away from reaching the level of Asuncion’s macro-economic stability.  

Speroforum columnist Peter Tase is an analyst of Latin American affairs

The views and opinions expressed herein are those of the author only, not of Spero News.

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