MercoPress. South Atlantic News Agency

Brazilian press calls Paraguay “rich beggar”, superb actor in asking for alms

Paraguayan president and former bishop Fernando Lugo

One of Brazil’s most influential weekly magazines with strong penetration in political and business circles, ‘Veja’ has a main article this week calling neighbouring Paraguay the “rich beggar”, a role which the successive Paraguayan governments “have played to success attracting significant international aid and grants”.

The syndrome of the rich man-beggar is not common, but not unusual to residents in the big cities says Veja. Most of the day he takes to the streets dressed as a beggar to ask for alms and pity, and this also works in Latinamerican diplomacy, with Paraguay superbly playing that role, argues the Brazilian magazine article, which has been posted in the Brazilian Foreign Affairs Itamaraty website.

According to Paraguay’s Central Bank data, the country is the second poorest in South America. However a review of that information by economist Wagner Enis Weber from the Paraguay-Parana Social and Economic Studies Institute shows that the “GDP figures are as false as the cigarettes, whisky and perfumes which Paraguayans smuggle into Brazil”, points out Veja.

“Officially Paraguay’s per capita income is 2.300 US dollars, but the right figure is according to economist Enis Weber is 6.160 USD which puts the country four steps higher above Colombia and Peru in regional ranking”.

However under-estimating the country’s GDP is not a creation of President Fernando Lugo, but rather a long established practice, “at least three decades old”, insists Veja.

The aggressive article is seen as a strong reply from the Brazilian business community to President Lula da Silva’s promise to triple payment for Paraguayan power and to pick the bill for infrastructure investments valued at over a billion US dollars, particularly an urgently needed grid line to supply power to the capital Asunción costing 500 million.

All the energy is generated by the shared and world’s largest operational dam of Itaipú, of which half belongs to Paraguay, but since it consumes only 10%, the rest is sold to its associate Brazil, at rates dating back to the seventies when contracts were signed.

For Paraguay to recover its “energy sovereignty” (and updated payments) has become a political issue and for Brazilian industry and energy distributors, following Lula da Silva’s promises to Lugo currently, under discussion in Congress, a major cost challenge.

In this scenario the influential “Veja” published the rich-beggar article and offers what it considers, besides “manipulation of numbers”, examples of that pity-begging attitude.

First in the list comes the Mercosur Development Fund created to boost infrastructure projects in the group’s smaller economies (Uruguay and Paraguay) for which Paraguay contributes with 1% and is entitled to 50 million US dollars. The lump sum is calculated on the country’s GDP and development indexes.

According to Veja the ‘poor-neighbour’ argument was used by Lugo to convince Lula da Silva to pay 360 million USD annually for Paraguayan power instead of the current 120 million USD.

But in Congress the argument, absent of all technical support for the increase, was confirmed as a philanthropic attitude of Brazil towards Paraguay, by a member of the ruling coalition that made the presentation, but rejected by most of the House.

“Those 240 million USD can make a big difference in a very poor country like Paraguay and it is Brazil’s duty to contribute”.

“Very poor country? According to the Paraguayan Statistics Institute, the Standing Research on Households incomes shows that in 2008 total income of Paraguayan families was 17.9 billion US dollars.

“The fact that total families’ incomes is far higher that the total products and services of the economy expressed in the GDP only confirms that most Paraguayan official data is falsified,’ statistics aberration’ precisely with the purpose of attracting international aid and pity” underlines Veja.

The article credited to Duda Texeira ends reminding readers that Paraguay is one of the most corrupt countries in the world, only loosing to Hugo Chavez Venezuela. And “then they surface hand out asking for money from us”.

The bill in support of the July 2009 agreement between Presidents Lugo and Lula da Silva increasing payments and promises of public works is currently under a heated discussion in the Brazilian congress.