MercoPress. South Atlantic News Agency

Paraguay said to have recognized Argentina's right to charge tolls along Paraná Waterway

Royón said the issue was agreeing on the amount of the fee

Argentina's Energy Secretary Flavia Royon said Wednesday that Paraguay had recognized her country's right to charge a fee (toll) to barges sailing along the Parana River Waterway and that the issue at this point was to discuss the price, for which a technical commission will be instated to assess the crossed claims between the neighboring countries for debts related to the Yacyretá Binational Entity (EBY).

“Today we were in Paraguay together with José Beni, from AGP [Argentina's Port Authority], and [with] directors of EBY meeting with the Paraguayan Minister of Foreign Affairs, Rubén Ramírez Lezcano, and his team. A point of agreement was reached on Argentina's right to charge tolls for the operation of the waterway,” she said in a Twitter thread.

Paraguay questions Argentina's charging of a toll on barges to finance the dredging and beaconing of the Santa Fe North section of the Troncal Waterway (VNT).

Since last year, US$1.47 per ton of cargo transported by ships coming from or going to foreign ports is charged, while Argentine-flagged vessels pay a symbolic amount of AR$ 1.47 per ton.

This collection has been challenged by Paraguay, together with Uruguay, Brazil, and Bolivia, who understand it as a unilateral measure “arbitrarily established outside the Santa Cruz de la Sierra Agreement and other international regulatory provisions in force.”

But, according to Argentina's Ambassador to Asunción Domingo Peppo, what is being charged is not a toll but a fee for the dredging and beaconing services provided. “It is only fair that those who use it the most should pay, and that is the Paraguayans,” Peppo told Última Hora.

This conflict in the end brought back old debts from the construction and purchase of the energy generated by Yacyretá. In protest against the toll, Paraguay unilaterally opened the gates of the Aña Cuá arm last Thursday, compromising the level of the reservoir required for the normal operation of the power plant, and only reversed them to their usual position after Argentina's complaint.

Since 1994, the energy generated there is divided equally between the neighboring countries, but since Paraguay only requires about 15% of it, the rest is sold to Argentina, which is now behind with its payments. Argentina admits it owes Paraguay about US$ 85 million worth of energy supply but Paraguay would owe Argentina around US$ 20 billion -interests included- for the construction of the dam.

In 2017, an agreement signed by then-Presidents Horacio Cartes and Mauricio Macri stated that Paraguay owed Argentina around US$4.5 billion. Only Paraguay's Congress has ratified this understanding. Argentina's Parliament is yet to review it.

In this scenario, the Council of Ambassadors of Paraguay (CEPSIR) highlighted Wednesday in a statement that several international treaties supported Paraguay's stance regarding its rights. The Centro de Armadores Fluviales y Marítimos del Paraguay (Cafym) echoed the declaration.

CEPSIR members consider that the unilateral and arbitrary decision violates international treaties, both bilateral and multilateral, many of them dating back more than 150 years. The document also contains a special reference to the Paraguay-Paraná Waterway Treaty from 1992, which provides that a retributive fee may only be charged once the service is effectively proven (Article IX).

Argentina's toll collection jeopardizes Paraguay's foreign trade, it was also explained.