Brazil’s Lula receives Paraguayan president-elect

Brasilia, May 16 (EFE).- Brazil’s Luiz Inacio Lula da Silva received Paraguay’s president-elect, Santiago Peña, here Tuesday for talks on deepening the strategic partnership between the two nations.

Peña, a former International Monetary Fund economist running as the standard-bearer of the conservative Colorado Party, won Paraguay’s April 30 presidential election and is set to take office in August.

The two men discussed a range of bilateral and regional issues, as well as the current state of the Mercosur trade bloc, comprising Argentina, Brazil, Paraguay, and Uruguay, Lula’s office said in a statement.

The chief issue on the bilateral agenda at the moment is an ongoing renegotiation of the 50-year-old accord governing the Itaipu hydroelectric dam, owned and operated jointly by Paraguay and its giant neighbor.

Under Annex C of the treaty, Paraguay and Brazil are each entitled to 50 percent of the power generated by the dam, but if either doesn’t use its share, it is required to sell it to the other party at a favorable price.

Brazil, with 214 million people, is Latin America’s largest economy and the 12th-biggest globally, while Paraguay has a population of just 6.7 million.

Paraguay has long called for a modification to Annex C, complaining that it is being forced to sell electricity to Brazil at below-market rates.

In March, during a meeting at Itaipu with outgoing Paraguayan President Mario Abdo Benitez to mark the appointment of a new managing director of the complex, Lula said that Brazil is committed to reaching a fair agreement with Paraguay on the dam.

“I am sure that will we achieve a treaty that will take very much into account the reality of the two countries and the respect that Brazil must have for an ally, our beloved Paraguay,” he said.

The new accord, Lula said, “will be more beneficial for the maintenance of the development of Brazil and of Paraguay, and for the maintenance of good coexistence between the two countries.”

Tuesday’s discussion between Peña, 44, and the 77-year-old Lula also touched on binational infrastructure projects, such as the Integration Bridge linking Foz do Iguacu, Brazil, and the Paraguayan city of Presidente Franco, and cooperation against transnational crime.

EFE ed/dr

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