In Response to Paraguay’s Outcry Over Itaipu Brazil Offers US$ 1 Bi Loan

Itaipu Brazil is planning to offer a financing package worth one billion US dollars for industrial projects in Paraguay, Brazilian financial newspaper Valor Econômico reported. According to the newspaper, which cited unnamed sources, the financing will be offered through Brazil's National Development Bank, or BNDES.

Details of the operation will be unveiled on April 29 during a meeting between Brazilian President Luiz Inácio Lula da Silva and his Paraguayan counterpart, Fernando Lugo.

The financing is a response by the Brazilian government to pressure from Paraguay on the price that Brazil pays for electric power from the bi-national Itaipu hydroelectric facility.

Currently, Brazil's pays US$ 45 per megawatt. Paraguayan officials have demanded changes in the existing contracts that would allow for a considerable hike in line with international prices.

The 14,000-megawatt Itaipu dam was built as a Brazilian-Paraguayan joint venture and began operating in the 1980s. The dam is located at the border of the two countries on the Paraná River and is one of the largest dams in the world. It provides almost all of the energy consumed in Paraguay and 20% of Brazil's entire demand.

Since taking office last year President Lugo has been calling for energy "fairer prices" and a renegotiation of the whole Itaipu operation, since all surplus electricity can only be sold to energy starved Brazil.

The issue has been increasingly controversial, and Paraguay has admitted it's a long term negotiation emulating the situation with that of Panama and the United States over the Panama Canal, a long term negotiation process."

Paraguay so far has rejected several Brazilian financial alternative options plus several infrastructure projects. President Lugo needs windfall earnings to honor much of his electoral campaign promises to invest in social, health and education affairs.

Mercopress

Tags:

Ads

You May Also Like

Jungle Boogie

And then I am in Fortaleza, my friends are there to meet me, my ...

Brazilian President Tells at UN Brazil Is Ready to Help the US and Europe

Brazilian president Dilma Rousseff, on addressing UN’s 66th Assembly General, in New York, said ...

Brazilian Car Racer Gets Pole Position in Miami’s Real Estate Race

The world of auto racing has attracted fans from across the globe. Perhaps people ...

Brazilian Congress Flooded with Requests for Ouster of Legislators

The president of Brazil’s Chamber of Deputies, Severino Cavalcanti (PP-PE), said, Wednesday, August 3, ...

Brazil’s Lula Finds Culprit for Global Crisis: White People with Blue Eyes

Brazilian President Luiz Inácio Lula da Silva and British Prime Minister Gordon Brown agreed ...

African Diaspora Finds in Brazil That Education Is the Way

The 3rd Conference of the Association for the Study of World African Diaspora (ASWAD), ...

Brazil Reduces Ethanol Added to Gas to Force Prices Down

The Brazilian government’s decision to reduce the sugarcane-based ethanol additive it puts in gasoline ...

Brazil Wants US Condemned for Cotton Subsidy

Brazilian cotton producers are waiting for the World Trade Organization (WTO) to release its ...

Brazil Won’t Raise Taxes, Promises Minister

Brazil’s Minister of Finance, Antonio Palocci, said that the government will pursue the commitment ...

Brazil to Create Technological Center at Border with Argentina and Paraguay

Authorities and representatives of organizations for business fostering in Argentina, Brazil and Paraguay participated ...