Brazil and Paraguay on Thursday formally canceled a controversial energy agreement -- signed in May but only revealed last week -- after it threatened to upend the government of Paraguayan President Mario Abdo.
The deal is related to the Itaipu dam -- the second largest hydroelectric plant in the world in terms of capacity, which straddles the border between the two countries.
The two countries are partners in the plant, which provides power to both, but Paraguay is entirely dependent on its share.
The deal -- to establish a schedule for the purchase of energy from the plant until 2022 -- faced severe criticism in Paraguay where some experts claimed it would cost one of South America's poorest countries $200 million.
Foreign Minister Luis Castiglioni and three other officials resigned last week over the controversy, and when opposition lawmakers announced they would begin impeachment proceedings against Abdo, Paraguay told Brazil that the deal was dead in the water.
The two countries will resume "negotiations over the contracting of electric power from the Itaipu" dam, an official statement said.
The cancelation of the agreement means the opposition's move to oust Abdo is likely to lose steam.
In a public message, Abdo thanked those who supported him, including Brazil President Jair Bolsonaro, a close right-wing ally, adding that "democracy has triumphed."
While the Itaipu dam's capacity to generate 14,000 megawatts is dwarfed by that of the Three Gorges Dam in China (22,500), it holds the world record of generating more than 103 million megawatt hours in 2016.
Brazil and Paraguay on Thursday formally canceled a controversial energy agreement — signed in May but only revealed last week — after it threatened to upend the government of Paraguayan President Mario Abdo.
The deal is related to the Itaipu dam — the second largest hydroelectric plant in the world in terms of capacity, which straddles the border between the two countries.
The two countries are partners in the plant, which provides power to both, but Paraguay is entirely dependent on its share.
The deal — to establish a schedule for the purchase of energy from the plant until 2022 — faced severe criticism in Paraguay where some experts claimed it would cost one of South America’s poorest countries $200 million.
Foreign Minister Luis Castiglioni and three other officials resigned last week over the controversy, and when opposition lawmakers announced they would begin impeachment proceedings against Abdo, Paraguay told Brazil that the deal was dead in the water.
The two countries will resume “negotiations over the contracting of electric power from the Itaipu” dam, an official statement said.
The cancelation of the agreement means the opposition’s move to oust Abdo is likely to lose steam.
In a public message, Abdo thanked those who supported him, including Brazil President Jair Bolsonaro, a close right-wing ally, adding that “democracy has triumphed.”
While the Itaipu dam’s capacity to generate 14,000 megawatts is dwarfed by that of the Three Gorges Dam in China (22,500), it holds the world record of generating more than 103 million megawatt hours in 2016.
