Why the Harper government was happy with the ouster of Lugo in Paraguay

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 Fernando Lugo campaigning in 2008. (Photo: Fernando Lugo Méndez / flickr)

Six weeks ago the left-leaning president of Paraguay Fernando Lugo was ousted in what some called an "institutional coup." Upset with Lugo for disrupting 61-years of one party rule, Paraguay's traditional ruling elite claimed he was responsible for a murky incident that left 17 peasants and police dead and the senate voted to impeach the president.

The vast majority of countries in the hemisphere refused to recognize the new government. The Union of South American Nations (UNASUR) suspended Paraguay's membership after Lugo's ouster, as did the MERCOSUR trading bloc. Last week the Council on Hemispheric Affairs reported: "Not a single Latin American government has recognized [Federico] Franco's presidency."

But Canada was one of only a handful of countries in the world that immediately recognized the new government. "Canada notes that Fernando Lugo has accepted the decision of the Paraguayan Senate to impeach him and that a new president, Federico Franco, has been sworn in," said Diane Ablonczy, deputy foreign minister, the day after the coup. This statement was premature. After a confusing initial statement, Lugo rejected his ouster and announced the creation of a parallel government.

A week after the coup Stephan Harper's Conservatives participated in an Organization of American States mission that many member countries opposed. Largely designed to undermine those countries calling for Paraguay's suspension from the OAS, delegates from the US, Canada, Haiti, Honduras and Mexico traveled to Paraguay to investigate Lugo's removal from office. Ablonczy said the aim of the OAS mission was to "provide important context from Paraguay to inform international reaction. It is important that we avoid a rush to judgment and focus on the best interests of the Paraguayan people." The delegation concluded that the OAS should not suspend Paraguay, which displeased many South American countries.

In an interview three weeks after his ouster Lugo alluded to Ottawa's hostility. "With the current polarization between the United States, Canada and Mexico on one end and South America on the other, we have tried to find regional alternatives. The coup d'etat now attempts to attack the [South American] regional integration efforts." Both the Canadian Labour Congress and the newly formed international labour federation IndustriALL Global Union criticized the Conservatives move to recognize the new government.

On a couple of occasions the overthrown president has claimed Canadian economic interests contributed to the coup. "Those who pushed for the coup are those who want to solidify the negotiations with the multinational Rio Tinto Alcan, betraying the energetic sovereignty and interests of our country," Lugo told his supporters one month after the coup. IndustriALL Global Union concurred with the president, sending a letter to the CEO of Rio Tinto. "Rio Tinto, which has a legendary association with the government of Canada, has been quick off the mark to resume negotiations on behalf of Montreal-based Rio Tinto Alcan for a $4 billion aluminum plant," wrote Jyrki Raina, general secretary of IndustriALL Global Union. The labour federation called on "Rio Tinto to publicly disclose its interest and involvement, if any, in the coup d'état in Paraguay and the ousting of a legitimately elected democratic government of Fernando Lugo."

In 2010 Montreal-based Rio Tinto Alcan, a subsidiary of Rio Tinto, began lobbying the Paraguayan government for subsidized electricity to set up a massive aluminum plant near the Paraná River. The company was seeking a 30-year contract that could cost Paraguay's government hundreds of millions of dollars and they received Ottawa's backing. According to international media reports, the Canadian embassy in Buenos Aires, which is in charge of this country's diplomatic relations in Paraguay, lobbied the government on Rio Tinto Alcan's behalf.

The Lugo government was divided over the project, which would consume more energy than the country's entire 6.5 million population and damage the environment in various other ways. Three weeks before Lugo's ouster Vice-President Federico Franco, who represented an opposition party, complained to Ultima Hora newspaper: "I told the President of the Republic (Lugo): why did you send me to Canada to study the [aluminum] project if, finally, a Deputy Minister (Mercedes Canese) was going to oppose it." After the coup the vice-president became president and Franco announced that negotiations with Rio Tinto Alcan would be fast tracked.

Harper's Conservatives must be happy.


Yves Engler's the author of a number of books. His most recent is Lester Pearson's Peacekeeping: the truth may hurt.

This article was first published by iPolitics and is reprinted here with permission. 

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