Itaipú: A National Cause
This project seeks to promote informed citizen participation in support of a fair and transparent agreement on the Itaipú dam, shared with Brazil, due for renegotiation in 2023.
DEMOS’ first contribution to this effort was to prepare a study on Paraguay’s forfeited energy wealth at this hydroelectric plant. The main findings were presented at a public event in Asunción, in April 2019, and will be published by El Lector in a forthcoming book.
No other dam in the world has generated as much energy as Itaipú. Its construction on the Paraná River resulted from a treaty signed in 1973 treaty, after a secret negotiation led by two autocratic governments. The treaty established equal energy shares, yet compelled Paraguay to cede its unused portion to Brazil at values well below market pricing.
To calculate Paraguay’s forfeited energy wealth, DEMOS assembled a comprehensive database covering the years in which energy exports were made to Brazil, form 1985 to 2018. Various authoritative sources were used to prepare the data set. Had Paraguay received a fair market price for these exports, over the course of 34 years it would have:
Received an additional income of 75.4 billion dollars; an amount close to the country’s GDP for both 2017 and 2018.
Stimulated the national economy and generated 147.2 billion dollars in additional growth; a figure equivalent to Paraguay’s GDP in the last four years.
Doubled its public investment in education and health care, and used a surplus of 33.4 billion dollars to modernize the country’s infrastructure and alleviate poverty.
Between 1985 and 2018, Brazil appropriated 86% of Itaipú’s energy wealth, while Paraguay received only 14%. Paraguay could have been a very different country with the equitable distribution of this wealth.
See the DEMOS presentation carried out in Asunción, in April 2019.
Image credit: Alexandre Marchitti (portada), APPG (evento).