Bilateral Relations between the US and Paraguay

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Paraguay is a country located in the southern part of America. It is part of Latin American countries. The country has a population of approximately seven million people, the majority of whom, about ninety percent are Roman Catholic Christians. The people speak Spanish and Guarani languages (Jermyn and Yong, 137).

The country has flourished in Agriculture and has pleasant forest and wood resources. Paraguay has a rich history characterized by wars and military interventions. The Chaco War between Paraguay and Bolivia defined a political system in Paraguay, which has undergone various transformations to form its current political and leadership system.

Paraguay has signed many bilateral and other relations agreements with its neighboring countries and other countries in the world. This is in effort of achieving political stability, economic growth, fight against narcotics and terrorism and other social evils in the region and the world at large. The United States on the other hand is a larger country located in the northern part of America. The country is more stable politically and economically when compared to Paraguay (Bowles, 2).

With its resources and desire to invest, the US has also entered into a number of agreements with many countries. It also gives such countries political, financial and military support to enable them to achieve their goals, which also interests the US. The bilateral relation between Paraguay and the United States is one of these beneficial relations that has realized much accomplishments and is also likely to yield more benefits for both the two countries in the future.

The start of the relation between Paraguay and the United States of America dates back to as early as 1845. The countries established the relationship so that they may meet their own interests. USA helped Paraguay in its domestic concerns while taking advantage of their president’s anti-communist stand in Latin America.

Paraguay wanted the US to assist them in their security concerns. Paraguay’s president, Stroessner, felt that his government was threatened by communists and thus supported US’s security policies to solicit US’s support in maters of security and development. The US, on the other hand was interested in trade and investment in Paraguay.

The relationship between these two countries was good between World War II and towards the end of 1970s. However, this relationship started wavering in the late 1970s due to a bridge of human rights and lack of political reforms. Stroessner’s dictatorial nature denied the citizens political and press freedom, an issue that America did not support (Mora and Cooney, 196).

His government officials also were involved in trafficking of narcotics, an issue which distorted the country’s relationship with America. Therefore, political, constitutional and governance reforms were necessary in Paraguay in order to rejuvenate its relationship with the US.

Alfred Stroessner, president of Paraguay, served for the longest time as president as compared to other Latin American countries. Stroessner reigned in Paraguay for eight successive terms between 1954 and 1989, for thirty-five years, after staging a coup d’état against the then reigning President Federico Chavez. Stroessner was born and brought up in a German family. His daddy came from Germany.

And his mother was from an influential wealthy family in Paraguay. Stroessner started his journey to power by participating in various public and background activities in Paraguay. He first participated in the Chaco War against Bolivia in 1929 (Morales, 101). This is where he excelled as a good commander and impressed the people who were craving for power once the war was over.

However, Stroessner acted in the background through the period of coups and periods of short governments in Paraguay, assisting presidential aspirants ascend to power through military interventions. In 1951, the then Paraguay’s president Federico Chavez appointed Stroessner as the commander in chief of the armed forces of Paraguay as a tribute to his assistance accorded to him to gain presidency.

Stroessner later overthrew Chavez in 1954 by staging a coup against him after differing over the issue of arming the police. Stroessner changed the constitution of Paraguay to enable him cling to power as long as possible (Mora and Hey, 2003). His government carried out many assassinations, torture, and was involved in corruption; drug trafficking, money laundering and gross election malpractice.

He suppressed the freedom of his opponents and the press an issue that made many of them to live in exile throughout his reign. General Andres Rodriguez staged a coup d’état against Stroessner on February 3, 1989 that ousted him. Stroessner then lived in exile in Brasilia, Brazil for seventeen years where he died. The Paraguayan government denied Stroessner state honors in his burial. His family members and a few of his friends buried Stroessner in Brasilia, Brazil.

Stroessner’s anti-communism attitude made him accepted by the US as a partner in many of its activities. The US used his anti-communism to fight anti-communists in Paraguay and in the Latin America. This friendship is what strengthened the relationship between Paraguay and the United States of America.

Stroessner depended on the US troops to offer his country security against communists and his political rivals while US was interested in investment and trade. He maintained his relationship with America to his advantage until America pushed him to allow political reforms in Paraguay.

Regional blocs played an important role in enhancing relationships between countries in their region (Haas, xi). Countries made regional blocs in order to strengthen their local economies, eliminate trade barriers, and even assist each other in governance issues (Mattli, 3; Laursen, 106). The American countries formed regional blocs after the Cold War. They believed that a state driven economy would lead to economic collapse and would not favorably compete with a market driven economy.

“After the Cold War, the market driven, liberal economic model has spread throughout the world and the world economy has become interconnected as a result of globalization” (Kantorun, Para.1). Kantorum also noted that some of the regional blocs formed around the world not only represent trade and economic policies but also other regional interests. Regional blocs of interest in this case include MERCOSUR, EU (European Union, and NAFTA (North American Free Trade Agreement).

MERCOSUR is one of the regional blocks, of Latin American countries. The founding members of MERCOSUR are Argentina, Paraguay, Brazil and Uruguay. The bloc unites countries of southern America. The aim of coming up with this bloc was to establish one market for the members and to do away with internal tariffs.

The countries’ motivation into forming a regional bloc was to enhance regional integration, improve their economies and promote democracy in member countries. Brazil and Argentina are the founding nations of the MERCUSOR trade block.

They came up with it deliberately to eliminate security uncertainties in these countries and avoid military coups and takeovers as those experienced before. These countries including Paraguay and Uruguay had experienced military coups before they attained democracy. The member countries therefore view this regional organization as an important tool, which is likely to prevent overthrowing of governments through military interventions and institutionalize democracy in their countries.

Another motivation for this regional integration is economic liberalization through common plans of industrialization and setting marketing tariffs (Aquin and Caro, 1; Barbato and Bucheli, 2). Uruguay and Paraguay, who were smaller members of MERCOSUR, transformed their policies to allow foreign investment and export substitution between member countries.

These are the policies, which enabled Paraguay to liberalize its trade and investment activities and undergo political, social and constitutional transformations to meet basic requirements for the relations. The member states formed committees to make policy and marketing strategies and set tariffs for the trading bloc.

They also made committees responsible for dispute resolution in member countries. However, since these countries had non-uniform constitutions, the member states made the last decision in line with their constitution.

North American Free Trade Agreement (NAFTA) came into action in 1994, with Mexico, Canada and United States as its founding members. Just like MERCOSUR, NAFTA’s aim was to eliminate trade barriers and tariffs between member countries and enhance regional integration (Hufbauer, and Schott, xi).

The heads of state of these member counties established NAFTA. Unlike MERCOSUR, NAFTA had no committees to bring together the heads of the member states to put plans in place for further integration. Thee bloc helped boost the economic growth of member states especially Mexico.

For US, NAFTA was to help it to minimize illegal immigrations and improve the economic relations between the two counties. MECURSOR had a more comprehensive regional integration plan than NAFTA and it succeeded in combating military interventions in member countries. The blocs also have served as tools for regional integration and globalization of trade and economy.

Paraguay’s major economy is Agricultural, some commercial activities, and a struggling industrial economy. The country has a large subsistence sector, high urban unemployment, a large labor population and re-export sector. It has a large electricity-generating sector, which is the world’s second largest hydroelectric generator.

The country is open to foreign investors and treats them with dignity. The country’s economic growth depends upon a number of export products. Some of these are cotton, sugar electricity, and various ceral crops.

The United States and Paraguay enjoy a cordial association in commerce and in various state operations that are intended for their mutual benefit. Paraguay is committed to counteract drug trafficking, human trafficking, money laundering among other trans-boundary evils taking place across its boundaries. It takes part in anti terrorism and anti narcotic activities in partnership with its neighboring countries and the United States. The United States is also committed to help Paraguay to meet its development goals. It supports the stabilization of Paraguay’s democracy as well as economic and constitutional reforms.

The two countries have continued to work together in fulfilling the requirements of a number of global agreements. There is also great improvement in bilateral trade between the two countries. There is an active exchange of imports and exports between the two countries. US’s multinational firms have also a number of branches in Paraguay to enhance this partnership in investment and trade.

This firms feature sectors like agro-industry, computer, banking, communication among other service-oriented sectors. (“Bureau of Western Hemisphere Affairs”, Para. 28). There are many US business agents in Paraguay and a good number of US citizens reside in Paraguay.

The US also offers Paraguay material, monetary and technical support. This includes the skills and tools the Paraguay government needs to achieve its goals.

The U.S. Department of State, the Drug Enforcement Administration, the Department of Justice, and the Department of Treasury “provide technical assistance, equipment, and training to strengthen counternarcotics enforcement, combat trafficking in persons, promote respect for intellectual property rights, and to assist in the development and implementation of money laundering legislation and counterterrorism legislation,” (Para. 30).

Paraguay has signed bilateral investments agreements with other countries. These include Argentina, Taiwan, South Africa, Brazil, France, Chile, United Kingdom and Uruguay.

It has also signed other agreements with other countries like Austria, Peru, Spain, Romania, Costa Rica, El Salvador, Germany, among others. The agreements that Paraguay has signed with the US include Agreement relating to investment guaranties of 1955 and Agreement relating to investment guaranties of 1992 (“2008 Investment Climate Statement”, Para. 30).

The signing of agreements between regional blocs like MERCOSUR and the European Union will open up marketing opportunities leading to globalization and economic development.

Apart from trade and investment agreements between Paraguay and US, the two countries also collaborate in military issues. Military agreement between US and Paraguay came into effect in 1994. The agreement was mainly aimed at averting local military interventions and terrorism. The agreement gave the United State’s military immunity to carry out humanitarian operations in Paraguay and enabled it to carry out joint exercises with the Paraguayan military. They also collaborate in protecting intellectual property rights (Beittel, Para. 2).

In conclusion, the bilateral relationship between Paraguay and the United states has been a long-term venture. Even though the relation started in 1845, many scholars do not agree with this fact.

This is because the relation between these two countries was not very much public during its establishment. The relation became public in the late 1970s when the US tried to force Paraguay to brig about reforms in its political system and constitution. This is what ended the tyrannical governance in Paraguay and reinstated humanitarian and press freedoms.

Even though the US and Paraguay have hand a long-lasting relation, there have been a number of challenges in this relationship. The relationship between the two counties has faltered a number of times due to war, political and humanitarian issues. Similar interests in combating narcotics, terrorism and communism made the relation flourish. The US signed an agreement with the US to get permission and protection to carry out investment activities in Paraguay.

Paraguay also entered into the agreement because it needed protection against communists and needed to develop the country. President Stroessner of Paraguay started this partnership agreement with the US in pursuit of his own interest of clinging to power. The relationship, however, forced him to be flexible to reforms and took Paraguay to another level.

The Policies of MERCOEUR, in which Paraguay is a member, prohibited the countries to make bilateral agreements with non-member states. This must have threatened the relation between the US and Paraguay. The signing of agreements between regional blocks like MERCOSUR, the EU, and NAFTA has changed the situation. With this globalization, Paraguay and the United States have a good prospective future in their relations.

Works Cited

Aquin, Nora, and Caro, Ruben. Políticas públicas, derechos, y trabajo social en el Mercosur. Buenos Aires: Espacio, 2009. Print.

Barbato, Celia, and Bucheli, Mario. Mercosur, una estrategia de desarrollo : nuevas miradas desde la economía y la política. Montevideo: Ed. Trilce, 2000. Print.

Beittel, S. June. Relations United States-Paraguay. Bloggers of the Americas. 2010. Web.

Bowles, Nigel. The government and politics of the United States. New York: St. Martin’s Press, 1993. Print.

“Bureau of Western Hemisphere Affairs.” Background Note. U.S. Department of State. 2010. Web.

Haas, Ernst B. The uniting of Europe; political, social, and economic forces, 1950-1957. Stanford, Calif.: Stanford University Press, 1968. Print.

Hufbauer, Gary C., and Schott, Jeffrey J. North American free trade: issues and recommendations. Washington, DC: Inst. für Internat. Economics, 1992. Print.

Jermyn, Leslie, and Yong, Jui L. Paraguay. New York : Marshall Cavendish Benchmark, 2010. Print.

Kantorun, Ufuk. Regional intergration in America: MERCOSUR, NAFTA. Bilgesam. 2010. Web.

Laursen, Finn. Comparative regional integration: theoretical perspectives. Aldershot, England: Ashgate, 2003. Print.

Mattli, Walter. The logic of regional integration: Europe and beyond. Cambridge: Cambridge Univ. Press, 1999. Print.

Mora, Frank O., and Cooney, W. J. Paraguay and the United States: distant allies. Athens, Georgia: University of Georgia Press. 2007. Print.

Mora, Frank O., and Hey, Jeanne A. K. Latin American and Caribbean foreign policy. Lanham, Md.: Rowman & Littlefield Publishers.

Morales, Waltraud Q. A brief history of Bolivia. New York: Facts On File, 2010. Print.

“2008 Investment Climate Statement”. Paraguay. U.S. Department of State. N.d. Web.

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Bilateral Relations between the US and Paraguay

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