Brazil, Paraguay sign bilateral agreements

Brazil has signed two bilateral agreements with Paraguay on Wednesday (Jun. 8), covering aviation and plans for a bridge over Paraguay River to connect Porto Murtinho, Mato Grosso do Sul (Brazil) and Carmelo Peralta, Alto Paraguay.

Paraguay Foreign Minister Eladio Loizaga says his country is interested in expanding trade relations and cooperation with Brazil. For José Serra, his Brazilian counterpart, the fact that Paraguay was the first country to arrange an official visit to Brazil following President Dilma Rousseff's suspension to stand the impeachment trial underscores the importance of the relationship between the two countries.

“This is a central relationship for Brazil, founded on historical backgrounds. We share a long border. About 300,000 Brazilians live in Paraguay—the second largest community of Brazilians abroad. Our ties have been strengthened in recent times,” Serra noted.

He said Brazil wants to expand business with Paraguay by removing non-tariff barriers and enhancing bilateral cooperation in combating smuggling and trafficking in drugs and weapons. “It is also crucial that we tap further into the waterway potential of the La Plata basin,” he said.

About MERCOSUR, Serra said there was “broad convergence” between Brazil and Paraguay about the pressing need to advance the bloc's foreign agenda. “We have discussed about the recent initial offers between MERCOSUR and the European Union. And we will work hard towards a balanced and beneficial agreement for MERCOSUR.”

Deals

The agreement on the construction of an international highway bridge over Paraguay river will have the costs for both its design and construction shared equally by the two nations. According to Serra, the new bridge will be key to forging a highway connection between the port of Santos, in Brazil, and those of Inquique and Antofagasta, in Chile. “Taking steps towards promoting the geographic integration between Paraguay and Brazil will also expand the Southern Cone's connection with both the rest of South America and the world's more economically dynamic regions,” he argued.

The agreement on aviation, in turn, stipulates, among other things, that air companies from one country will be allowed to fly across the border no landings or connections within the other country's territory. The deal also dictates that neither of the countries should charge air companies fees higher than those imposed on its own air companies providing similar international air services, or allow any such charges to be made.

“Brazil is the main destination of Paraguayan exports and the main supplier of products to that country. In 2015, bilateral exchange reached [$3.3 billion]. Bilateral trade is characterized by a large percentage of high value-added goods. Last year, manufactured products accounted for 93.7% of Brazilian exports to Paraguay,” Brazil's Ministry of Foreign Affairs says on its website.

Translated by Fabrício Ferreira / Mayra Borges