Brazilian President Dilma Rousseff praised or at least highlighted the outstanding voter turnout for Paraguay’s April 21 general elections. But she also reiterated that Paraguay’s re-entry into the MERCOSUR trading bloc remains impossible so long as Paraguay continues to regard Venezuela’s incorporation into MERCOSUR as an illegal and unprecedented act.  Paraguay refuses to endorse the integration of Venezuela, which remains controlled by the Bolivarian movement as a legacy of President Hugo Chavez, who died earlier this year. 

Rousseff’s recent statements about Paraguay are part of Brazil’s interventionist strategy towards its landlocked southern neighbour. The South American giant is implementing a strategy to undermine the administration of the newly elected Paraguayan President Horacio Cartes by trying to impose conditions and actions that only Paraguay’s independent national congress ought to make.  The goal of Rousseff’s statements is to thwart Cartes’ plans to demand the end to the exploitation of hydroelectric energy produced by the Itaipú bi-national hydroelectric dam shared with Brazil, and negotiate for a better price for the electric energy produced there for Brazilian consumers.

Brazilian diplomats are trying to prevent the potential meetings with their Paraguayan counterparts in late 2013, with whom they have to negotiate adjustments urgently needed in view of the coming 40th anniversary of the Itaipú treaty.  There is no question that Brazil wants to exploit Paraguay’s natural resources undercharging for electrical energy that legitimately belongs to Paraguay.  President Rousseff’s government has accused the government of former president Federico Franco of being established illegitimately when his predecessor, President Fernando Lugo, was impeached in June 2012.  However, the Organization of American States has certified that the process of Lugo’s impeachment and removal were in accord with Paraguayan law and parliamentary procedure. For Brazil, the election of Cartes remains suspect.

Even while Venezuela had violent protests after its April 2013 presidential elections, and is calling in the military into a law enforcement role, Brasil was eager to acknowledge the legitimacy of Hugo Chavez’s successor, President Nicolas Maduro, who attempted to orchestrate a military coup in Paraguay last year and is persona non grata there.  Brazilian president Rousseff was unwilling to speak to Paraguay’s supposedly “illegitimate” President Franco and would not answer phone calls from him.  This pressure seeks to keep Paraguay isolated and so that it will not succeed in its claims over the unfair bilateral agreement with Brazil and the need to renegotiate the Itaipú treaty.

However, things have changed.

Horacio Cartes won in the April 21 presidential election and confirmed Paraguay’s status as a firmly democratic republic.  He won with a landslide victory with over 46 percent of the total votes cast, while his Colorado party has a majority in both chambers of Congress. The people of Paraguay have invested President-elect Cartes with the serious responsibility of leading the country over the next five years. He has already shown a willingness to negotiate with neighbouring countries, such as Argentina, so that Paraguay can once again become a functioning member of the MERCOSUR trade bloc from which it was suspended following the impeachment of former president Fernando Lugo.

Cartes’ legitimacy is unquestioned, but Brazil quickly began to show signs of treacherous diplomacy. For example, President Rousseff congratulated the newly elected Cartes from a stage at a public event rather than calling him on the night his election was called or on the following day.

Since Rousseff was supposedly was worried over Paraguay’s alleged rupture of “democratic order,” it would have been logical for her to act quickly and applaud the recent institutional restoration in Paraguay, which she had considered to be an irreparable loss. Indeed, the recent elections proved Rousseff and other regional presidents to be wrong for the second time in less than a year: the first time being the impeachment of Lugo.  Conversely, instead of commending the excellent outcome of civic participation in the elections, Brazil sent threatening messages to the new leader with the sole purpose of diminishing Cartes’ authority and stature to demand changes to the Itaipú treaty signed by the two countries in 1973.

Paraguay, as a founding member, deserves to have its suspension lifted by MERCOSUR and readmitted as a full member of the UNASUR and CELAC groupings.  It is the people of Paraguay who determine the fate of their country and have shown that they have a greater level of democratic participation than many countries of the region. 

In short, Brazilians have invented a trap that will be used systematically to avoid paying a rate for electrical energy produced by the Itaipú facility that the people of Paraguay deserve. This is a reprehensible and intolerable act of blatant imperialism that the Paraguayan people as a whole must firmly reject and denounce with perseverance in the most emphatic and determined possible way before the world.   Given these circumstances, once he takes office in August, Cartes should forcefully engage with his Brazilian counterpart, making clear the Paraguayan people’s aspirations for economic independence national dignity.

That Argentina, Brazil and Uruguay should once again stand together to thwart economic growth and democratic processes of Paraguay is not lost on the Paraguayan people who still recall that it was the same three powers that invaded the country in 1864. It was the genocidal War of the Triple Alliance that divested Paraguay not only of nearly half of its territory, but it also resulted in the loss of as many as 1 million people or 90 percent of its pre-war population, making it the deadliest war in modern history.  Cartes will have to rely not only on direct diplomatic confrontation with the South American countries currently arrayed against Paraguay, but must also call upon partners from outside the region, such as the United States and the European Union, to address the economic warfare now being waged against his small and landlocked country.

Spero columnist Peter M. Tase analyzes international business and diplomacy. 



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