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Paraguay - Foreign Relations

One part of the Stroessner legacy was isolation — the “Albania of South America” that had gradually become politically, diplomatically, and academically alone. The constancy of the Stroessner regime and the elimination of political competition for thirty-five years meant that Paraguay was often ignored by Latin Americans.

Paraguay maintains close diplomatic relations with fellow Common Market of the South (Mercado Común del Sur - Mercosur) countries on economic, political, and social issues. In past years, Paraguay’s role as a conduit of black-market trade has caused tension with some Mercosur countries. Relations with the United States have been steady, especially as democratic reforms have flourished in Paraguay.

Paraguay is surrounded by larger neighbors with whom it has, during the last hundred years, engaged in bitter conflict--the disastrous War of the Triple Alliance against Brazil, Argentina and Uruguay (1864–70) and the exhausting Chaco War with Bolivia (1932–35).

The United States supported the ouster of authoritarian leader Stroessner and helped resolve the crisis that resulted from Paraguay’s contested 1998 election. Economic ties between the United States and Paraguay have rebounded after many years of decline during Paraguay’s economic collapse. The United States remains committed to providing some economic aid to Paraguay and to stopping money laundering in the region. Separating itself from its neighbors, Paraguay remained the only South American country to recognize Taiwan diplomatically.

Paraguay belongs to the United Nations and many of its specialized agencies. Paraguay is also a member of the Common Market of the South (Mercado Común del Sur—Mercosur), International Criminal Police Organization (Interpol), International Labour Organization, International Monetary Fund, Latin American Economic System, Latin American Integration Association, Organization of American States, Rio Group, and World Bank.

Paraguay is a party to a number of significant treaties, including international agreements on biological weapons, chemical weapons, copyright, human rights, intellectual property, nuclear weapons non-proliferation, refugees, and torture. In the environmental arena, Paraguay is party to the following agreements: Biodiversity, Climate Change (including the Kyoto Protocol), Desertification, Endangered Species, Hazardous Wastes, Law of the Sea, Ozone Layer Protection, and Wetlands.

European Union-Paraguay relations are based on the 1991 Framework Co-operation Agreement and on the 1995 EU-MERCOSUR Framework Agreement on Cooperation. The EU adopted its country strategy paper European Community-Paraguay in August 2002, which provided a multi-year strategy for 2001-2006 with an indicative allocation for assistance of US$69.25 million. The priorities agreed on by the EU and Paraguay are modernization of the state, productive development, competitiveness and investments, and poverty reduction. As of 1 May 2002, a delegation of the European Commission has been operating in Asunción. Additionally, the sixth European Community-Paraguay Joint Committee was held in Asunción on 10 November 2005.

As a member of MERCOSUR, Paraguay has adopted an active regional integration policy with Brazil, Argentina, and Uruguay. The MERCOSUR Common Council on 18 February 2002 decided to create a permanent legal tribunal in Asunción. As a member of MERCOSUR, Paraguay is party to ongoing negotiations for an EU-MERCOSUR association agreement. The main objective is the liberalization of trade in goods and services, aiming at free trade, in conformity with WTO rules, as well as enhanced cooperation and strengthened political dialogue. Paraguay also supports regional trade integration in the Western Hemisphere, notably by negotiating to establish a free-trade area of the Americas. International Organizations.

Lawmakers in Paraguay voted in June 2012 to impeach Fernando Lugo, after a botched eviction of peasant squatters that left several dead. In line with Paraguay's constitution, Lugo was replaced by Vice President Franco, who had been a strong opponent of the president. A South American trading bloc barred Paraguay's new president, Federico Franco, from participating in an upcoming summit, following the ouster of former president Fernando Lugo. Mercosur said Paraguay will not be allowed to take part in its meeting in June 2012 in Argentina. A Mercosur statement, issued by the Argentine Foreign Ministry, expressed the group's "most energetic condemnation of the rupture of the democratic order" in Paraguay.

Venezuelan President Hugo Chavez said his government will halt fuel sales to Paraguay. Brazil and Argentina withdrew their top diplomats from Paraguay, while Venezuela, Bolivia, Ecuador and Cuba said they would not recognize the new administration. Despite the international outcry, the ouster of Lugo in Paraguay was viewed as a stunning success by US and regional elites. The experience would serve as a prototype for future efforts to oust progressive leaders in the region.

The election of Horacio Cartes in 2013 helped return Paraguay to the international community.




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