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What’s Behind Last Week's ‘Coup’ in Paraguay?

Latin American analysts draw connections between agribusiness and the Paraguayan elite

by Altilio Boron and Idilio Mendez Grimaldi (translated by Jay Hartling)

Paraguayan President Fernando Lugo at the World Economic Forum in 2010. Copyright World Economic Forum (www.weforum.org) / Edgar Alberto Domínguez Cataño [CC-BY-SA-2.0 (http://creativecommons.org/licenses/by-sa/2.0)], via Wikimedia Commons
Paraguayan President Fernando Lugo at the World Economic Forum in 2010. Copyright World Economic Forum (www.weforum.org) / Edgar Alberto Domínguez Cataño [CC-BY-SA-2.0 (http://creativecommons.org/licenses/by-sa/2.0)], via Wikimedia Commons


Last Friday Paraguay’s president Fernando Lugo was impeached by congress in a move condemned by the landlocked country’s South American neighbours as a coup d’état. “The coups have returned, but disguised,” said Cuban president Raúl Castro. Canada, Germany and Spain are reported to have recognized the new government despite the objections of most Latin American governments.

Jay Hartling, an independent journalist from Halifax living in El Salvador, translated the following two articles from Spanish to help explain to English-speaking audiences the powerful influence of multinational agribusiness corporations on the political situation in Paraguay.


Last Friday (June 22, 2012), the Paraguayan Congress rushed through one of the most blatant acts of fraud in the political history of Latin America: the removal of President Fernando Lugo, in a summary trial that appeared more like a political lynching than a constitutional process. 

With a speed proportional to its illegitimacy, the most corrupt Senate in the Americas (and that’s saying a lot!), found him guilty of “poor performance” of his functions as President because of the tragic deaths that occurred in an eviction of landless farmers in Curuguaty. 

This massacre was a trap devised by a right wing that has waited since Lugo assumed the presidency in 2008 for the right moment to get rid of his government, which, despite not affecting its interests, opened a space for social protest and popular organization that was incompatible with the dominance of the ruling class. The eternal dishonour attached to being the leader of this institutional coup belongs to Mr. Aldo Zucolillo, the director and owner of the daily newspaper ABC Color, and the lofty leader of the sinister Interamerican Press Society (SIP).1 

The coup in Paraguay imitates the 2009 coup directed against Mel Zelaya in Honduras,with the exceptional difference that Mr. Zelaya was removed from his house by the military at the point of a bayonet.  Zucolillo, “illegitimate child” of the Stroessner era 2 – is the same as various others of his type in the rest of the region – an unscrupulous businessman who developed his wealth under “freedom of the press” and the improbable “independent journalism”, the loincloth that doesn’t hide what Paraguayan economist Idilio Mendez Grimaldi says -- that Zucolillo is the main partner of Cargill in Paraguay, one of the largest agro-industrial transnationals in the world.” 

ABC Color launched an intense campaign prior to the coup d’etat, preparing a political climate that permitted Lugo’s express political hanging.  

The leadership of Cargill and Monsanto in the “democracide” perpetrated in Paraguay is scandalous. Mendez Grimaldi, in a detailed analysis of the sistematic plunder of Paraguay by Cargill and Monsanto, notes the following:  

· Agro-industrial transnationals in Paraguay pay almost zero taxes, due to their ferocious protection in Congress, which is dominated by the Right.  

· Tax collection in Paraguay is just under 13% of GDP.  

· 60% of taxes collected by the Paraguayan state are the IVA [similar to GST].  

· Large-scale landowners do not pay taxes.  Land taxes represent scarcely 0.04% of taxes

collected – about $5 million, according to a study by the World Bank.

· Agro-industry produces an income equal to 30% of GDP, which represents approximately $6 billion.  

· 85% of all land in Paraguay – approximately 30 million hectares – is in the hands of 2% of the population, who also dominate the national political stage. The “2%” make their money in extractive industries and land speculation; have tight ties to the transnational financial sector; and, in one way or another, are linked to agro-industry. 

Due to the operation of these conditions in the country, where perks and bribes are the engines of the accumulation of capital, it was very unlikely that Lugo could stabilize power without constructing a powerful social base. 

Nonetheless, and despite the numerous warnings of allies inside and outside Paraguay, the ousted president did not undertake the homework of consolidating a broad-based and heterogenous social movement with the same enthusiasm that brought him to power in 2008.

His support in congress was minimal.  Only four senators opposed the parliamentary coup, and he didn’t have much more support in the lower house.  His only strength to discourage his bitter enemies was his ability to mobilize in the streets.  However, he stubbornly resisted this, even though a wide range of sectors and regional governments were willing to accompany him. 

Unfortunately, he missed his opportunity, and throughout his mandate made continuous concessions to the Right, ignoring the fact that it didn’t matter how many concessions he made – they would never accept his presidency as legitimate. 

His concessions to the corrupt Paraguayan oligarchy only served to embolden them, and did nothing to pacify their virulent opposition.  And, despite making these concessions, Lugo was still considered a bothersome intrusion, even though he promulgated, instead of vetoing, anti-terrorist laws requested by “the Embassy” – another important protagonist in his downfall. 

The US embassy, together with the agro-industrial transnationals and the oligarchy, made up the gang that dominated Congress. The Paraguayan Right worked hand in glove with Washington to impede, among other things, the entrance of Venezuela in Mercosur [Mercado Comun del Sur, or Common Market of the South; a political and economic alliance between Paraguay, Brazil, Uruguay and Argentina]. 

The first declarations made by Lugo’s illegitimate successor, Federico Franco, are proof of this.  Mr. Franco publicly assured the White House that the Paraguayan Senate would not vote in favour of Venezuela’s entrance to Mercosur. What the usurper didn’t realize is that there is a higher probability that it will be HIS country that will be left out of Mercosur, UNASUR and other regional organizations.3  

Meanwhile, several countries have released statements saying they would not recognize the new government of Paraguay (Venezuela, Argentina, Brazil, Bolivia, Chile, Peru, Ecuador, Nicaragua, El Salvador), several have suspended relations with Paraguay and recalled their ambassadors, and others are in the process of consideration. 

In addition to recalling its ambassador, Venezuela has cut all petrol shipments to Paraguay.  Canada, the US, Great Britain and Spain have all announced their support of the “new” government.4

Lugo realized too late what little democracy there really is in the institutionality of the capitalist state, which removed him in a tragicomic political show trial that violated with impunity all standards of due process. 

His strange reaction that validated the legal monstrosity perpetrated against him seemed more like the actions of some bishop forgiving a humble parishioner of a minor sin than that of a popular president stripped of his office by a gang of looters. Why did he not call on the people to resist, surrounding the congressional building with a human wall to prevent the coup d’etat?

Let this be a lesson for all of the people of Latin America and the Caribbean: only the mobilization and popular organization of the people can guarantee the stability of governments interested in enacting a project of social transformation, no matter how moderate or accommodating it is in its reformist proposals, as it was in the case of Lugo. The oligarchy and imperialism will never stop conspiring and acting. 

And, if at times it seems as if they are resigned to the advancement of a government elected by a popular majority, this appearance is deceiving – more illusion than real, as we have just seen one more time in the case of our suffering brother of a country, Paraguay.

Atilio Boron is a widely-published Argentine sociologist and political theorist and commentator.  Dr. Boron is professor of political and social theory at the University of Buenos Aires. The original Spanish version of this article can be found at http://www.telesurtv.net/articulos/2012/06/24/por-que-cayo-lugo-la-conexion-del-agronegocios-195.html



Synthesized and translated from an article written by Idilio Mendez Grimaldi

On Friday, June 15, 2012, police carrying out an order to remove a group of people from a major land-holding in the Department of Canindeyu on the Brazilian border were ambushed by snipers, mixed in with a group of campesinos who were reclaiming the land.

The order was given by a judge and a public prosecutor in order to protect a large land-holder.  The landholder is Blas Riquelme, former president of the Colorado Party and former senator, who amassed a fortune in landholdings, including this 70,000 hectare ranch, during the dictatorship of Alfredo Stroessner. 

Part of Riquelme’s ranch includes 2,000 hectares of public land that were obtained through dubious means. The campesinos were demanding, through Lugo’s land reform promises, the return of state land for local production.     

The judges’ orders were carried out by members of the Special Operations Group (GEO), whose elite members were trained in counter-insurgency techniques under the former Uribe regime in Colombia. 

It is difficult to comprehend, as the mainstream press would have it, that an elite squad of Special Forces could be ambushed by a group of rag-tag campesinos, resulting in six police deaths. It is believed that internal sabotage within the police force is the actual culprit, and that the sniper shots caused a panic reaction in the police forces that opened fire on the campesinos. 

Interestingly, the public prosecutor’s office, the national police and judicial powers in the country are all controlled through agreements with the U.S. Agency for International Development (USAID).

As a result of the attacks, 17 people died; 6 police and 11 campesinos, and 50 people more seriously wounded.  Among the dead is the Chief of GEO -- the brother of President Lugo’s security.

The objective? To criminalize and demonize to the point of pure hatred, all campesino organizations in order to force them to abandon the countryside for the exclusive use of agro-industry. 

The consequences? President Fernando Lugo and his supporters on the Left are accused of instigating the campesinos by a congress dominated by the Right; the extractive transnational agro-industry in Paraguay, run by companies like Monsanto, advance in their campaign to demonize and persecute campesinos and suddenly attack them on their land; and finally, the installation of a comfortable stage for the oligarchy and parties of the Right for their triumphal return to power in the 2013 elections.  

Preceding the massacre were a number of events.  On October 21, 2011, the Minister of Agriculture and Livestock, Enzo Cardozo, illegally released Monsanto’s genetically-modified (GM) cotton seed, Bollard BT, for commercial use in Paraguay. Protests by campesinos and environmental organizations were immediate.  The gene of this particular cotton is mixed with the gene of Bacillus Thuringiensis, a toxic bacterium that kills some cotton blights, such as weevil larvae. The GM seed was not registered by the state institution, the National Service for the Quality and Health of Seeds (SENAVE), because it had not received approval from the Ministries of Health and the Environment, as required by law.

As a result of SENAVE, and the two ministries’ resistance, Monsanto worked closely with the

Association of [Agro] Producer’s Unions (UGP) to attack SENAVE and its president (Miguel Lovera) for not registering Monsanto’s GM seed for commercial use throughout the country.  The UGP is closely associated with Grupo Zucolillo, which also publishes the daily newspaper ABC Color and is the principal partner of the agro-industry transnational Cargill in Paraguay. 

Reports in ABC accused Lovera of corruption and nepotism.  The accusations were made by a supposed union member Silvia Martinez. 

Martinez is the wife of Roberto Caceres, technical representative to various agro-businesses – all of them associated with the UGP - among them Agrosan, recently acquired by transnational Syngenta.

The day after the accusations made by Martinez, ABC Color carried a six column piece published by UGP “The 12 Arguments to Fire Lovera”.  These alleged arguments were presented to Vice President Federico Franco, who at the time was acting president, as Lugo was out of the country. 

On June 15, 2012, the day of the Curuguaty massacre, the Minister of Agriculture let a comment slip at an agricultural expo in front of the press that a group of agro-chemical investors from India cancelled an investment project in Paraguay because of alleged corruption in SENAVE.  The name of the company in question was never revealed.  

On the same day and at the same event, Monsanto presented a new cotton seed variety – the double GM seed Bollard BT AND RR (Roundup Resistant). The controversial RR seeds contain the glypohosate herbacide Roundup, which is made and patented by Monsanto. Monsanto’s objective is the registration of this new GM seed, as they have done in other countries around the world. 

Prior to the expo, ABC Color had systematically denounced the Minister of Health (Esperanza Martinez) and the Minister of Environment (Oscar Rivas) of corruption – they were the two ministers that did not give the green light for the release of Monsanto’s GM seeds.

Last year, Monsanto earned $30 million tax free on royalties from the use of GM soy seeds in Paraguay alone (because it does not declare this part of its earnings).  Independently, Monsanto also makes money from the sale of the GM seeds.  All of the soy cultivated in Paraguay, on more than 3 million hectares of land, with a production of 7 million tons in 2010, is genetically modified.  

** Idilio Mendez Grimaldi is a Paraguayan economist, analyst and investigative journalist.  He is a member of the Paraguayan Society of Political Economists, and author of the book “The Heirs of Stroessner”


1 The SIP represents the interests of powerful media owners in Latin America.

2 The dictator General Alfredo Stroessner came to power in a coup d’etat in 1954 and ruled Paraguay, as the leader of the Colorado Party, until 1989.                                                        

3 Paraguay has been banned from participation in the Mercosur summit that starts June 28, 2012 in Mendoza, Argentina.  http://www.worldcrunch.com/coup-detat-backlash-across-latin-america-paraguay-impeachment/5729

4 This paragraph was added by the translator from various news sources.







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