Brazil and Paraguay:Brazil concedes on Enerdy Deal

Brazil and Paraguay: Brazil concedes on Itaipú Energy Deal, Signals Commitment to “Good Neighbor” Policy

July 25, 2009 marked the passage of a landmark piece of reform that was brokered between Brazil and Paraguay. The agreement, signed in Asunción, finally resolved a decade long disagreement between the two governments regarding the Itaipú dam. The revisions in the Itaipú treaty had far reaching implications for the national standing of Paraguay’s President Fernando Lugo and Brazil’s President Luíz Inacio Lula da Silva as well for Brazil’s leadership role in Latin America. It is also expected to bring about a series of new prospects for energy initiatives in the region. The agreement represents a historic turnaround on the part of Brazil, which had been vehemently opposed to tariff concessions for decades. Analysts believe that the new agreement is indicative of the “good neighbor” policy that Lula has recently advocated in the region, as Brazil attempts to solidify its leadership role and shore up a base of moderate democratic support for its foreign policy initiatives.

The dam is already one of the world’s major hydroelectric projects, as it straddles the triple border area between Brazil, Paraguay and Argentina on the Paraná River. It was the product of a 1973 treaty between the then-dictatorial governments of Brazil and Paraguay, and has been a subject of contention ever since. Paraguay has long protested the stipulation in the treaty that required it to sell its surplus energy exclusively to the national Brazilian company, Electrobrás, for a fixed annual rate of $120 million. The issue came to a head after Bolivia nationalized its gas reserves in 2006, resulting in Brazil having to pay the country a much higher price for natural gas. As demand for power surged dramatically in Southern Cone countries such as Argentina and Ch ile, Paraguay calculated that it could earn billions if it were allowed to sell its Itaipú surplus on the open market. When President Rodrigo Lugo embarked on his presidential campaign, he made the revisions to Itaipú agreement a key part of his platform, demanding “energy sovereignty” and the right to sell its share of surplus power directly into the Brazilian market. Paraguayan officials have argued that the terms of the treaty were invalid, as they were the result of mismanagement by Dictator Alfredo Stroessner, who signed the Paraguayan half of the agreement in 1974. Stroessner and his Colorado party allegedly used Itaipú revenue for acts of personal acquisition rather than for national development. For full article click here This analysis was prepared by COHA Research Associate Ana gha Krishnan Immigration Issues in the Galapagos Islands The crown jewel of Ecuador, the Galapagos Islands, is one of the world’s most fascinating wonders. Located 1,000 kilometers off Ecuador’s Pacific Coast, it is home to a unique array of flora and fauna, including some of the rarest species. The islands’ aquatic life, including marine iguanas, blue-footed boobies, and giant tortoises that can live up to 150 years, draws in over 150,000 tourists a year who marvel at the spectacular diversity and beauty of the islands. The climate, a result of interacting ocean currents, differing coastal conditions, and the islands’ volcanic origin, helps create an environment that nourishes the variety of ecological and biological life forms that have intrigued so many, including scientist Charles Darwin, whose theory of natural selection was inspired by his visit to the islands in the 1830s.

As important to the rest of the world as they are to Ecuador, the global significance of the Galapagos was officially recognized in 1979, after the United Nations Educational, Scientific and Cultural Organization (UNESCO) classified them as a World Heritage Site. Since then, the islands have undergone many international efforts to preserve their natural beauty and wildlife. Approximately 97 percent of the land area of the islands has been declared a national park, and in 1984, the Galapagos became part of the World Biosphere Reserves under UNESCO’s Man and Biosphere program. While such preventative measures have been integral to the success of the islands’ preservation, it has also created a number of problems for its inhabitants, both human and otherwise. For full article click here This analysis was prepared by COHA Research Associate Tara Patel Tuesday, August 11, 2009 | Press release 09.205

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