With less than two weeks to go before Paraguay’s presidential election, left-wing front runner Monsignor Fernando Lugo Mendez has promised a moderate foreign policy in an interview with Emerging Markets.
As Lugo has gained ground in the polls, concern has grown among foreign investors that south America may soon have another radical leader alongside Hugo Chavez of Venezuela, Evo Morales of Bolivia and Rafael Correa of Ecuador.
But Lugo rejected the expression “strategic alliances” regarding his regional diplomatic plans.
“We do not like to speak about strategic alliances,” he said. “I may be prejudiced, but to me that sounds like ‘agreements for confrontation’, ‘discriminatory blocs’, etc.
“We would rather use expressions like ‘solidarity’, ‘integration for common action’, ‘agreement for reciprocal benefits’, stuff like this, which reflect a real and brotherly will of unity between our countries,” he said.
Lugo, if elected, would prioritize Mercosur, of which Paraguay is a full member. His plans for “energy sovereignty” include the renegotiation of a big electricity contract with Brazil.
Both countries jointly own the huge Itaipu hydroelectric plant on their border; Paraguay only uses 5% of the output, and sells the rest of its share to Brazil. Lugo wants to increase the price of the electricity it exports.
“Brazil is usually dealing with corrupt Paraguayan governments. I am convinced that when it will negotiate with a serious, responsible and honest government, it will change its attitude,” he said.
Lugo was received by president Lula in Brasilia last week, but there is little sign that Brazil is willing to make concessions on this issue.
He also praised the Bank of the South, launched at the end of last year by several South American countries, including Venezuela and Argentina.
“This is a very relevant and valuable initiative and my government will follow this very seriously,” he said. Nevertheless, Lugo remained short on specifics.
“Our government programme is basic but at the same time very comprehensive,” he said. It includes “land reform, economic recovery and social justice”.
Lugo, who is leading the opinion polls, could put an end to six decades of rule by the Colorado Party – which was led by the brutal dictator Alfredo Stroessner from 1954 to 1989, and has clung on since then under the current system of free elections.
Lugo resigned from the Catholic priesthood in December, to deal with Paraguay’s constitutional law that forbids religious ministers running for public office.
He is running against education secretary Bianca Ovelar, from the Colorado party, and a former general, Lino Oviedo, in the poll on April 20.
On economic policy, Lugo said that he was already considering preventive measures to stem the potentially destabilizing impact of the US recession on the impoverished economy of his country.
“Do you think it is possible to escape from the effects of the instability of such a powerful economy, whose currency is a reference for world trade? “We have to take preventive measures which limit its impact, even though it may not offset them completely,” Lugo said.
“The strengthening of our domestic economy, the development of national production, the industrialization of our commodities, will be among others measures defence mechanisms in the face of the cyclical financial crisis that is shaking the world,” he added.