Monday, December 17th 2012 - 06:50 UTC

Paraguay’s next government ‘must debate on whether to remain or abandon Mercosur’

Foreign minister Jose Felix Fernandez Estigarribia said that Paraguay needs an open discussion on whether the country should remain or not in Mercosur, particularly since the issue has become extremely divisive. However the discussion must be addressed by the elected government that takes office in August 2013.

Foreign minister Fernandez Estigarribia admits its has become a very divisive issue in public opinion

“The new government must define our permanence or not as full member of Mercosur. This is a pending debate since in Paraguayan public opinion there’s a growing feeling, probably majority who oppose Mercosur. This is so in the business community and even some presidential hopefuls support the idea”, said Fernandez Estigarribia.

The minister said that the debate on the issue is a task for the government after the April 2013 elections: “we have to be very careful about what we finally do, taking into account all interests, of all sectors from Paraguay”.

Fernandez Estigarribia revealed that once a month his ministry brings together representatives from the different chambers which is when “we have a good idea what the business and manufacturing community thinks, and they are divided, there are some pushing to exit Mercosur as full member and others against it”.

Precisely last week on occasion of the end of the year gathering the head of the Paraguayan Industrial Union, UIP Eduardo Felippo said the future of Mercosur was ‘uncertain’. Among the authorities present was President Federico Franco.

“Paraguay must open to the world; we must accept that Mercosur has not meant positive results, rather the contrary, it has us in a slow persistent anaesthesia to the extent we didn’t realize that the others were growing vigorously (Chile, Peru) and we were stalled and dying happily”, said Felippo emphasizing that if in 20 years no real integration was achieved, much less under current circumstances with Paraguay suspended from the group.

He added that in twenty years Mercosur has not materialized a single integration process of relevance, not even with the European Union could we reach an agreement on trade. And how can this be achieved now when we have Venezuela among us, a country dedicated to blast its own production machinery?”

21 comments Feed

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1 Britworker (#) Dec 17th, 2012 - 10:36 am Report abuse
Is this a question they even need to think about, Mercosur have treated them like shit. I'm surprised they haven't told them to shove it already and linked up with the Chileans.
2 Anglotino (#) Dec 17th, 2012 - 10:54 am Report abuse
Mercosur is an inward looking economy, whereas Colombia, Peru and Chile are outward looking.

The differences are quite startlingly when you compare the two groups. Paraguay has always been quite inward looking and perhaps it is time it starts looking outwards.
3 DanyBerger (#) Dec 17th, 2012 - 11:33 am
Comment removed by the editor.
4 Condorito (#) Dec 17th, 2012 - 12:09 pm Report abuse
Thanks for that Dany.
Back on topic.
Yes Fernandez is right. Paraguay needs to rethink its place in South America.
5 ChrisR (#) Dec 17th, 2012 - 03:02 pm Report abuse
Bit of a no-brainer really.

Stay with the nutters of Mercosur or get into the fast lane with Chile.
6 cornishair (#) Dec 17th, 2012 - 03:04 pm Report abuse
Condorito, any idea why some parts of south america seem to be stuck in a very 20th century idea of leftist goverment (i mean god, we've seen the mess it made of eastern europe for half a century)?
7 Condorito (#) Dec 17th, 2012 - 06:33 pm Report abuse
As I am sure you a direct consequence of the Iberian conquest, Latin America was opened up for plunder, a process that allowed a few to control the wealth and the masses to become poor and uneducated. The Brits replaced the Spanish, then the Americans the Brits, but the process of bleeding the continent continued uninterrupted until the 20th century. As news of the French revolution inspired the independence movements of the early 19th century, the changes in Russia kindled the egalitarian fire in the 20th. Dirty wars and covert meddling wreaked havoc with Latam in the 20th century as people-power movements advanced in upsetting the established order. The result was bloody coups, dictatorships and the crushing of dreams of Latam utopia. As the cold war thawed, the dictatorships came to an end and most of the continent experimented with the free market. The problem was that most countries had (and still have) weak and corrupt institutions – as was true in Eastern Europe - when introduced to the free market you get jungle capitalism and you are almost back to where you started with the Spanish.

So, to answer your question IMHO, most people 40 and over have lived though dictatorships and the worst kind of capitalism and having seen nothing improve are seduced by that unfulfilled socialist dream.

The solution as I see it is all about the strength of institutions. These are the foundations of a country. Economics are secondary. Whether you go left or right makes no difference if you are building your house on straw foundations – you will fail.

In Chile we were lucky: we went from the frying pan to the fire and learned neither were good. We came out the other side with a strong grip on resources and solid institutions. Others were not so lucky and continue to jump from the pan to the fire and back to the pan.
8 GeoffWard2 (#) Dec 17th, 2012 - 06:34 pm Report abuse
C #6,
because military governments are seen as of the Right - and the Right is seen as military, and anti-military is seen as of the left.
The left is not viewed as that of Eastern Europe, Russia, China, etc.;
it is the Left of Fidel and Cuba, of Bolivarism (strangely), of the charismatic early years of Che Guevara, of anti-USA.
It is supposedly 'of the People', of the poor, of 'hope' .......

.... and, most importantly, it is where the most tractable, proportionately large, populations are that can be used to keep a 'left' in power.
9 Condorito (#) Dec 17th, 2012 - 06:39 pm Report abuse
Yes, I agree with Geoff.
10 emerald (#) Dec 17th, 2012 - 06:42 pm Report abuse
Think ...........*..*..........
You don't know Latin America enough,so your comments are the same replicated points.
11 Pugol-H (#) Dec 17th, 2012 - 08:30 pm Report abuse
After recent events Paraguay will probably want out of murcosur, it’s been a hard lesson in whom your friends are.

Not sure how practical it would be for them, as they are now surrounded by murcosur. Which could switch them on and off like a light if they wanted to.

Can’t see any easy answers for Paraguay.
12 Elena (#) Dec 18th, 2012 - 01:16 am Report abuse
@ 7 -8

Great review, is as simple as that. The only difference I find here is that ppl from 40 years or older are usually more optimistic than those of 20-30 years maybe because older ppl have seen the changes and younger ppl have had to deal with the worse crisis. Our older institutions from estatal mixed capitalism are still strong and those mix badly with the new ones more flexible but weaker, but progress has been made. It did help that Zedillo begun the transition both in political and economic ways, now we just need to actualice old institutions and make stronger the younger ones.

I think Paraguay is making the right questions, it needs broarder perspectives and more friends in South America. to stablish a good relationship with Bolivia, Peru and Chile while keeping what is there still of positive from Mercosur would be good steps IMO. Also, great decisión to begin with the need goverment of 2013.
13 Ernie4001 (#) Dec 18th, 2012 - 02:05 am Report abuse
At the end of the day Paraguay will play smart and will kick mercosur off. People and goverments can lie but numbers don´t, so a smart move for this country is shifting to the Pacific. The future is already there.
14 ProRG_American (#) Dec 18th, 2012 - 03:10 am Report abuse
Paraguay, you can leave anytime. I wonder how you will deal with those nasty American agricultural subsidies? Just like Uruguay the last time they tried to negotiate an FTA agreement with the USA? They walked out on the 2 nd day of negotiations.
15 Anglotino (#) Dec 18th, 2012 - 06:27 am Report abuse
I never realised there was just one other economy to trade with outside of Mercosur. I guess China isn't big on purchasing agricultural products from South America.... hang on!

Hmmm considering the US has FTAs with:
Costa Rica
El Salvador
Dominican Republic

Might not be as difficult as some would have us believe.
16 Condorito (#) Dec 18th, 2012 - 12:55 pm Report abuse
If Chile has a FTA with USA for agricultural products, why couldn't Paraguay. In fact it would be much easier for Paraguay to negotiate alone without cumbersome, inept Mercosur getting in the way.

And as @15 points out, it is not about 1 FTA with the USA it is about dozens. Chile's fruit exports to US fell about 10% last year, but that was recovered by exporting to Asia (we have FTAs with all Asia's main economies). With half of the world’s population crammed into south east Asia, the question is, why would you NOT want FTAs in place.

15: Exactly.

12: Quite right.
But are you optimistic or pessimistic? ;)
17 Pugol-H (#) Dec 18th, 2012 - 10:10 pm Report abuse
Getting out of murcosur and signing FTA’s should not be a great problem for Paraguay, it’s the logistics I wonder about.

What rights of navigation for shipping does Paraguay have down to, and out of the river plate estuary?

Or are we looking at just flying over or crossing borders with goods.

Given the considerable differences in the respective geographies of the two countries, specifically one has a very long coastline and the other has none, Chile has to be the most unlikely comparison for Paraguay.
18 Elena (#) Dec 18th, 2012 - 11:37 pm Report abuse
optimistic but I am on my twenties :)
19 British_Kirchnerist (#) Dec 23rd, 2012 - 02:25 am Report abuse
#7 Great first paragraph, followed by some rationalisations to avoid the obvious, pro-left, conclusions to the processes you summarised so well. I would only add that after all the disasters inflicted by right wing dictatorships and extreme IMF capitalism, the left has proven far better not only at distributing the wealth (as it really should) but also achieving growth in the last 10 years; also that the deep desire for continental unity feeds into the left's popularity...
20 cornelius (#) Dec 25th, 2012 - 03:36 pm Report abuse
To #19 How about the human cost of the left they do not create jobs they plunder the wealth of those who produce (Higher taxes) they use all the resources they confiscate property and crimes that go unpunished why? Because most of the crime is on those who have a little more the left have murder more people than any other system they way the murder is crime but that does not count! Thousands of people murder in Venezuela(More crime than Mexico and more murders)) Brazil Argentina Bolivia Paraguay( when Lugo was President) Ecuador all this countries in control of the left the left is a virus that take the thinking brain and make them useless.
21 ChrisR (#) Dec 25th, 2012 - 06:17 pm Report abuse
20 cornelius

Agree 100%.

B_K has always been just short of a six-pack, but since he has returned I think the lobotomy he underwent was a little too radical! LOLs

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