Political and Institutional Chaos in Paraguay

By Gaudin, Andres | NotiSur - South American Political and Economic Affairs, May 11, 2012 | Go to article overview

Political and Institutional Chaos in Paraguay


Gaudin, Andres, NotiSur - South American Political and Economic Affairs


In a pre-election climate that is becoming heated as the different political parties begin to endure the generally exhausting struggle among the leaders who aspire to be their presidential candidates, in April Paraguay experienced a new phase in its recurrent power clashes. This time, the war was between the Senate and the Corte Suprema de Justicia (CSJ) regarding CSJ justices refusing to step down when their term expired and seems to have ended in favor of the latter, but no one yet dares to say or even think that the differences have truly and definitively been overcome.

On a continent that each day shows more pride in its new instruments of institutional democratic structure, it was significant that all sides, including President Fernando Lugo, spoke during the crisis of submitting the dispute to Organization of American States (OAS) arbitration. Various media analysts said that several South American foreign ministries were surprised that a progressive government such as Lugo's would consider allowing interference from the most discredited multinational agency when the region has its own new organizations such as the Union de Naciones Suramericanas (UNASUR), the Comunidad de Estados Latinoamericanos y Caribenos (CELAC), and the Southern Cone Common Market (MERCOSUR).

The century-old Partido Colorado, which supported the dictatorship of Gen. Alfredo Stroessner (1954-1989), was the first to see the disputes come to the fore among the contenders to be the party's candidate in the April 2013 presidential elections. And the one who took the lead was Horacio Cartes, a shady businessman who has been linked to smuggling, drug trafficking, financing multinational mafias, and money laundering (NotiSur, Oct. 7, 2011).

The Brazilian daily O Globo made the most recent accusation against Cartes, reporting on March 29 that the US Drug Enforcement Administration (DEA) believes that Cartes, together with "members of his inner circle," runs "a money-laundering enterprise, an organization believed to launder large quantities of United States currency generated through illegal means, including through the sale of narcotics, from the TBA [Tri-Border Area] to the United States." Cartes, said the paper, "uses the Banco Amambay, which he owns, located in the TBA," where Paraguay, Argentina, and Brazil come together.

The "others" whom the Rio de Janeiro paper says are being watched by the DEA for their role in the "obscure financial network specializing in legalizing money obtained from illicit activities" are Surinam political and military leader Desire Delano Bouterse and Brazilian Fernandinho Beira-Mar, who, as head of the Comando Verhelho, was the major drugs and arms trafficker on the continent until his 2001 arrest.

The DEA's interest in Cartes was made public in November 2011, when several South American newspapers began to publish the secret US diplomatic cables released by WikiLeaks. In a Jan. 5, 2010, cable, Cartes is identified as the head of a money-laundering organization within the TBA.

The Paraguayan daily ABC Color mentioned a previous cable dated Aug. 27, 2007, in which the US Embassy in Asuncion mentions negotiations regarding money laundering between Cartes, as owner of Banco Amambay, and a former president of the Banco Central de Paraguay (BCP). The newspaper also alludes to a third cable, the date of which was not known, in which Cartes is linked to "one of the most powerful men" in the Mexican Sinaloa drug cartel, who was detained in Paraguay when he went to meet with the now-presidential hopeful of the Partido Colorado.

The WikiLeaks cables seriously damaged Cartes' reputation. ABC Color and the Web site E'a said his illegal operations were confirmed during Operation Heart of Stone, a coordinated transnational investigation approved as a Consolidated Priority Organization Target (CPOT), involving several US agencies, which reportedly dismantled an important drug-trafficking association that operated in the TBA. …

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