The Brazilian government wants to confirm the increase of the values paid to Paraguay for the exciding power of the hydroelectric Itaipu power plant. But, in the Congress, where the agreement needs to be approved, there is still resistance from the opposition.

By the proposal, the payment for the cession of the Paraguayan power would go from U$ 120 million to U$ 360 million per year. For deputy Antonio Carlos Mendes Thame, it is an appeasement act of Brazil.

He reminds that Itaipu plant was built fully with Brazilian resources. “This review of the treaty will mean a huge burden that, without a doubt, will be passed to the consumer, to the industrial, to the Brazilian producer.”

Geopolitical gains

However, according to the deputy Dr. Rosinha, Brazil has conditions to afford the increase, and Eletrobras will not need to pass this expense to the Brazilian electric power bills.

To Dr. Rosinha, the social and geopolitical gains justify the granting to the neighbor country. “Itaipu is not a company, is not an enterprise that was planned to make de country grow or planed to correct the Brazilian power shortfall.”

According to the member of the parliament, Itaipu was planned to solve an old demand of border with Paraguay. “It was a demand previous to the Paraguayan War, which has aggravated with the conflict. Itaipu was then created to flood the geographic areas of border dispute.”

Social problems

Dr. Rosinha defends that the Brazilian help to Paraguay’s development will avoid that the border Paraguayans search for a solution to their social problems in the Brazilian side.

There is still, according to the deputy, an agreement in order to the new resources be used also to regularize the situation of Brazilian living in Paraguay.

By contrast, Mendes Thame is not convinced. “All this is justification, pretext to the donation be made. I do not know to what extent, the ones paying more for this power should really reimburse any compensation given to those Brazilian living in Paraguay."

Special Commission

The agreement to the review of the taxes was signed in July of 2009 by the ex-president Luiz Inácio Lula da Silva and by the Paraguayan president, Fernando Lugo. Approved by the Mercosur Parliament Brazilian Representation

(Parlasur), the agreement will be sent to analysis of the special commission of the Chamber.