Revising Itaipu treaty a challenge, says Paraguayan president
Paraguay’s President Mario Abdo Benítez on Tuesday (Mar. 12) said that the revision of the Itaipu treaty will be a challenge for Brazil and Paraguay. Abdo met with President Jair Bolsonaro at the Planalto presidential palace during the former’s official trip to the country.
“Today we addressed topics that bring challenges to our relation, like Itaipu. Whatever the process of negotiation may be I’m confident that, as was the case in the beginning, it will continue to be beneficial for both nations and strengthen our connections,” he said.
The two countries are preparing to revise Annex C of the treaty, which outlines the financial bases for the enterprise. The Brazilian–Paraguayan firm has a yearly budget of $3.5 billion, 70 percent of which earmarked for the payment of the construction, which is expected cleared by December 2022, when Annex C of the treaty is due.
As it stands today, each country has the right to half of the country produced by the plant, but Paraguay uses just 15 percent of the total. Under the treaty, Brazil must be the priority buyer of Paraguay’s surplus. This is one of the rules Paraguay seeks to reconsider as part of the talks, so that the country has more autonomy over its energy surplus, making it possible, for example, for Paraguay to sell energy to other countries, or bringing energy to the free market in Brazil.
The plant is a global record breaker, and boasts over 2.6 billion megawatt hours (MWh) since the beginning of its production, in 1984. Last year, having generated 96.6 million MWh, the facility served 15 percent of Brazil’s energy market, and 90 percent of Paraguay’s.
New bridges
Bolsonaro and Abdo also talked about the construction of two other buildings linking Brazil and Paraguay, which should cost about $70 million each.
One of the bridges will be built over Paraná river and will connect the city of Foz do Iguaçu, Paraná, to the Paraguayan city of Puerto Presidente Franco. This will be under Brazil’s responsibility and will serve to ease the traffic of the Friendship bridge, between Foz do Iguaçu and Ciudad del Este. The funding for the project will stem from the Brazilian part of the binational company.
The other bridge, over Paraguay river, will be an enterprise to be embarked upon by the neighboring country, and will be in turn funded by the Paraguayan section of Itaipu. This bridge will connect the city of Porto Murtinho, in Mato Grosso do Sul state, to Carmelo Peralta, in Paraguay. The goal is to facilitate access to the Pacific Ocean.
After meetings at the Planalto palace, the two heads of state talked to the press and proceeded to the Foreign Ministry, where lunch was served. Abdo is expected to return to Asunción today.
