Paraguayan, Brazilian leaders meet at binational dam


Paraguayan President Mario Abdo Benitez and Brazilian counterpart Jair Bolsonaro met here Tuesday to discuss the future of this binational hydroelectric dam.

The two presidents spoke privately for 30 minutes before witnessing the installation of Joaquim Silva e Luna as the new director of the Brazilian half of the operation.

In a brief joint statement, Bolsonaro and Abdo Benitez said that their discussion focused mainly on preparations for the scheduled renegotiation of the Itaipu Dam accord in 2023.

Itaipu, one of the world’s largest hydroelectric dams, was built on the Parana River between 1974 and 1982. Brazil financed the construction.

Under the 1973 Itaipu Treaty, Brazil - Latin America’s biggest economy - and Paraguay each have the right to 50 percent of the electricity generated by the dam, while any unused electricity must be sold to the other partner at cost.

Paraguay meets 90 percent of its electricity needs using very little of its share of the power from Itaipu, while energy-hungry Brazil uses every bit of its portion, plus the Paraguayan surplus.

Abdo Benitez urged Bolsonaro to expedite the process of re-evaluating Annex C of the agreement, which regulates the price of the energy Paraguay sells to its giant neighbor.

Annex C has long been a sore point with Paraguay, which, as South America’s second-poorest country, could certainly use the additional revenue that would result if Brazil started paying something closer to market rates for the power.

In 2016, Itaipu generated enough electricity to supply all of Brazil’s needs for 2 1/2 months and meet Paraguayan demand for nearly seven years.

“We Paraguayans and Brazilians have an important challenge in front of us ... the analysis of the entity’s financial basis and provision of services,” Abdo Benitez said.

With 2023 looming, “the priority is to expedite the internal consultations and technical studies needed to satisfy the legitimate aspirations of both countries,” he said.

Abdo Benitez also referred to the agreement he signed in December with Brazil’s then-president, Michel Temer, for the construction of two international bridges near Itaipu, a pact that Asuncion wants Bolsonaro to ratify.