After Lugo’s Impeachment, Paraguay Faces Tensions with Neighbors

By Rachel Glickhouse

Argentina, Brazil, and Venezuela have seen strained relations with Paraguay following the country’s impeachment of President Fernando Lugo.

Following the June 22 presidential impeachment in Paraguay, the country has seen shifting relationships with other Latin American countries—particularly Argentina, Brazil, and Venezuela. Late last month, regional blocs Mercosur and the Union of South American Nations (UNASUR) suspended Paraguay until its presidential elections in June 2013. Meanwhile, the Organization of American States (OAS) indicated this week that Paraguay should remain a member. The United States has not taken an official stance on the impeachment.

On July 10, after concluding a trip to Asuncion, OAS Secretary General José Miguel Insulza stated Paraguay should not be suspended from the regional organization but urged the OAS to monitor preparations for next year’s election. He cautioned that an OAS vote to suspend Paraguay “would have serious economic implications for the country, given the direct impact of such a decision on other institutions of the Inter-American system and its indirect impact on other aspects of the international system and the country’s economic and financial well-being.” Noting that Insulza’s report will aid the U.S. decision on Paraguay’s situation, U.S. State Department Spokeswoman Victoria Nuland said: “[Insulza will] get a full, comprehensive picture of how all parties view these events, and then we’ll go from there.”

Paraguay’s relationship to Venezuela perhaps represents the largest rupture. Venezuela’s government refused to recognize the new administration in Asuncion and halted oil shipments to Paraguay on June 25. Paraguayan officials accused Venezuelan Defense Minister Nicolás Maduro of meeting with Paraguayan military and police leaders shortly before the impeachment, urging them to defend former President Fernando Lugo. Paraguay’s representative at the OAS called it an “intolerable interference” that violates international agreements. In addition, President Federico Franco’s communications minister expressed concern that Lugo will ally himself with Venezuela to try to return to power. As a result of the impeachment and Maduro incident, both countries withdrew their ambassadors.

President Hugo Chávez later acknowledged that Maduro had in fact met with the military. However, he also claimed a group of Paraguayan senators asked Venezuela for a bribe to let the Andean country enter Mercosur. Mercosur voted to admit Venezuela as a member in 2005, and legislatures in Argentina, Brazil, and Uruguay subsequently ratified the decision. But Paraguay’s Congress has held up Venezuela’s membership to the bloc since 2006. Now, Venezuela will become a full member at the end of July, after heads of state at a June 29 Mercosur summit agreed to allow the country to skip ratification by Paraguay. On July 7, Franco submitted a formal request to allow Paraguay to rejoin Mercosur, as well as to halt Venezuela’s membership.

The fallout from the Brazilian government’s decisions on the impeachment caused consternation in Paraguay—as well as in Brazil. Brazilian officials denounced the Paraguayan impeachment, voting to suspend Paraguay from Mercosur. In response to Paraguay’s suspension, Paraguayan Minister of Foreign Relations José Félix Fernández said the decision lacks “validity” and “is not only illegal, but also…violates due process.” Initially, Franco said Paraguay’s suspension from Mercosur would free the country from Argentina and Brazil’s “tutelage.” He also reminded Argentina and Brazil of their dependence on Paraguay for electric power generation, noting that both their largest cities depend on energy generated in Paraguay.

Some in Brazil also criticized the government’s response to the impeachment. One of Brazil’s opposition parties, the Brazilian Social Democracy Party, threatened to bring a case to the Supreme Court to challenge President Dilma Rousseff’s Mercosur decision on Venezuela. “If you don’t accept what happened in Paraguay, how can you accept what has happened in Venezuela?” said Sergio Amaral, a former Brazilian trade minister. Some in Congress also showed discomfort with the government’s response. But, testifying before the Senate on July 11, Brazilian Foreign Minister Antonio Patriota defended the government’s actions, saying Paraguay’s suspension from Mercosur sends “a clear message” against any “anti-democratic adventures.” He also defended the decision to incorporate Venezuela. “Both were hard decisions, but they were made carefully, with criteria so that they would not affect the Paraguayan people.”

Argentina, which supported Mercosur’s suspension from regional organizations, also faces tensions with Paraguay after the impeachment. The political crisis exacerbated a source of discord between the two countries: an Argentine infrastructure project on the Pilcomayo River that transects the border. Argentina is building a new canal on the river without consulting Paraguay first, though the two countries signed a 1994 agreement to allow a binational commission to administer construction on the river. The canal could leave Paraguay’s Chaco region without water and represents a “violation of Paraguay’s sovereignty,” says Enrique Salyn Buzarquis, the country’s minister of public works.

Learn More: