Paraguay, Brazil at odds over Itaipu dam revenues

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Paraguay’s president-elect, Fernando Lugo, is the ‘change’ candidate who got elected.

The former Roman Catholic bishop last month broke the hegemony of Paraguay’s long-dominant Colorado Party, which had governed the landlocked nation for more than six decades. The colorados and Mexico’s Institutional Revolutionary Party were for years the longest continuously ruling parties in Latin America. The Colorado Party’s reach was so pervasive it maintained power after its longtime standard-bearer, ex-dictator Alfredo Stroessner, was ousted.

Lugo is scheduled to take office Aug. 15. One of his stated first priorities is to cut a better deal with neighboring Brazil on the colossal Itaipu hydroelectric project on the two countries’ border.

Lugo says Brazil benefits from a sweetheart contract, writes Patrick J. McDonnell from Itaipu. But Brazilian President Luiz Inacio Lula da Silva says the 35-year-old treaty that created the project is not up for renegotiation. Brazil needs electricity to power its galloping economy. A potential conflict looms between two left-leaning presidents.