- 14 minutes ago
Paraguayan former president Santiago Peña resigned amid a corruption scandal linked to Ueno Bank. What impact would this process have on Paraguayan politics? We joined Agustina Alejandro to analyze it.
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00:00We now welcome Agustina Alejandro. She is a specialist in international relations and geopolitics as well.
00:09Thank you so much, Agustina, for joining us once again here in the podcast of Tell Us Your English.
00:14We are going over this crisis in Paraguay that had already unleashed, but today it had a complete new chapter
00:21with the resignation and then the continuing of the impeachment process.
00:25Thank you, Agustina, and tell us from your perspective, how are you looking at this situation?
00:30What does this mean?
00:33Hello and good night to you and to everyone watching.
00:39Thank you for having me once again on this podcast.
00:43It is quite outstanding what happened.
00:47Paraguay woke up with a president who had resigned and an impeachment is underway
00:53and nobody is able to say what was – this would have happened yesterday.
01:06You were saying on Tuesday the central bank ordered the intervention and dissolution of Warner Bank
01:12and today, after two days of bank lines, anxiety, street protests, Santiago Pena resigned in a video posted on X.
01:22Minutes later, the Chamber of Deputies voted unanimously 78-0 to impeach him for serious and systematic dereliction of duty.
01:36And here's the track, if Congress accepts the resignation, which already happened, Pena becomes a senator for life,
01:48which is parliamentary immunity.
01:52It's really, really surprising what happened.
01:56Well, I don't know if surprise could be the word.
02:05Pena, it's a borough technocrat, a former IMF economist who came from the Liberal Party and only joined the Colorados
02:15in 2016.
02:16He was the party's export product.
02:19He was the face for Washington, the Wall Street, and the rating agencies.
02:24Here in Uruguay, we've had some right-wing politicians, such as the former president, Luis Lacalle Pau,
02:36who was congratulating Santiago Pena on the new score on the rating agencies.
02:46He'd never had a base of his own, but they were always, always pointing to Paraguay in Montevideo,
02:57that they were, we'd had to be looking to Paraguay and Paraguayan's miracle.
03:05And what collapsed in Paraguay, it's a narrative.
03:10That's what it meant for Uruguay, it's what it meant for Malay in Argentina.
03:16For three years, we were sold the Paraguayan, this Paraguayan miracle, investment grade, low taxes,
03:24maquina factories, high growth in a serious country.
03:28And underneath, the credit ratings that these banks were growing with pensioners' money lending to shale companies
03:38and its own group with the president as a former shareholder.
03:43Pena worked as a fuse, actually, with the circuit overlords on fuse bonds.
03:50So, the whole system survives.
03:53By putting him on trial, the Cholera Party turns on a structural crisis of corruption and final capture
04:05into the personal failure of one man and presents itself as the institution that listened to the people.
04:13This is dependency in its purest form.
04:20A small state with elites who treat public money as private property offering itself to capital
04:28with minimal rules and minimal oversight when the model works.
04:33It gets appalled from Buenos Aires and applauded from Washington and Montevideo
04:39when it blows up, the people at the bottom pay.
04:44Always the patrons wash their hands and the bottom of the society is paying on that.
04:54And on Malay and Pena's possible escape, we need to be precise.
05:00I don't know if you were talking on it.
05:03An opposition senator said Pena apparently left the country.
05:07We now know it is not like that, and Pena is going to face trial.
05:15But, of course, this was fed with the suspicions as a precedent stated by Flavio Bolsonaro,
05:26who left for the United States through Puerto Iguazu,
05:30escorted by Santiago Caputo, Millet's top advisor.
05:34And the question for tonight is, like, is Argentina becoming the regional escape hatch
05:41for a right-wing in trouble?
05:43That's what it seems like, right?
05:47When we first saw the news tonight, there were rumors, right, about Santiago Pena
05:54maybe escaping through Argentina again.
05:56All of us turned to each other and said, really?
05:59In the same week?
06:01Well, apparently the sources have confirmed that he should be in Paraguay for now.
06:07Of course, we never know, and we could just finish this interview with more information
06:12because that's how things happen.
06:15But definitely what you were mentioning, right?
06:18And you were hitting so many good points here regarding the role that Argentina is playing right now
06:25because Argentina became for a moment that symbol and the example of this new libertarian government
06:33and wanted to be the beacon of this new movement.
06:37And now there are things that are shaking up in other parts of the continent
06:43and not even to talk about what happened in the United States.
06:47And it seemed like Argentina is the place that is trying to provide that sort of help, right,
06:55aid in supporting that plan that they presented and continue to try to present as successful.
07:01But going back to one of the things, Agustina, that you were mentioning right now,
07:05and I think that it's such at the center of what is being discussed,
07:09is the links of these governments that talk of freedom and talk of capitalism as a realm of possibility
07:18and is really a political elite completely linked to an economic elite
07:24that are using that position in government and in state in order to profit from public funds in this case
07:32and have actually used this narrative against corruption as a way to get there
07:38but have nothing but links with all of these private companies that have no control,
07:47that have targeted any mechanism of control that was in place.
07:51And I think that is something that goes beyond Paraguay, right?
07:55It's a way in which these governments are working.
07:59What can you tell us about how this model was implemented?
08:05Using Paraguay as an example, but you were mentioning, for example,
08:08Uruguay with La Gallepo, Milay in Argentina.
08:11How do these links between the politics and economics truly work?
08:17Well, the markets already reacted for Paraguay,
08:22which the country risk is up 16% and the dollar is up 10%.
08:28In a few hours.
08:31The fight now is whether Pena ends up on trial or protected by immunity
08:36if Alianna takes over, Carter's machines governs until 2028.
08:43For Uruguay, we have three fronts.
08:49Mercosur, or she holds the bloc rotating presidency since July,
08:54the president of Uruguay, and Uruguay has to oversee an institutional transition
09:01in a partner country with the democratic clause in the background,
09:07which we can remember this clause from the Venezuelan expulsion or suspension
09:16from Mercosur.
09:19And we have a direct impact because with the collapse of Buena,
09:24the Buena Bank, the Vasquez group also hates Uruguayan workers.
09:30And the Uruguayan right, as I was saying earlier,
09:33this is where it really hurts.
09:35The opposition used Paraguay as a club against the government of the Frente Amplio of Uruguay.
09:44Colorado Senator of Uruguay, Robert Silva,
09:49warned that Uruguay was losing competitiveness
09:56against Argentina, Chile, and Paraguay,
09:59which he called a magnet for investments,
10:04which is odd in light of recent events.
10:09But businesses' chambers repeated that Paraguay had cheaper energy, fuel, and taxes.
10:16And tonight, the magnet has nearly 3 million people unable to withdraw their own money.
10:25It reminds us of, I was really young,
10:29but it reminds us of the crisis of the Corralito in Argentina,
10:34and its resounding impacts on Uruguay in the early 2000 and 2001.
10:44But every time someone tells you in Uruguay,
10:49Uruguay should copy Paraguay,
10:51we have to remember Buena.
10:54In a captured state,
10:58everything that is cheaper ends up being very expensive.
11:03And it's always the same people who ends up paying.
11:09And also, we have to look at the map of reactions on the region,
11:17because it takes a lot, really a lot,
11:22the right that embraces Paraguay and Pena.
11:28I think of a senator in Uruguay that were speaking marvelous things the weeks before
11:38about the financial system that this bank was offering the state of Paraguay.
11:46And now we see this reaction.
11:52The former president of Uruguay was some weeks ago in Paraguay,
11:58and he said publicly that when he would return to Uruguay and say that Paraguay is fantastic,
12:09and it's really amazing what everything has blown up on their faces.
12:18La Nación in Argentina has put it this way.
12:23While some leaders backed Pena and others criticized him,
12:29his main partners, Trump and Millay among them, stayed quiet.
12:35This goes for most of the Uruguay and right-wing politicians also.
12:46And the voices that did speak on the regional divide was Panama's president Molina
12:54was among the first that defended Pena,
12:58praising his deep love for his country.
13:03It makes sense.
13:04Pena was one of the sponsors of Panama's entry in Mercosur as an associate state.
13:12Castes in Chile played it safe, saying it's up to Paraguayans to resolve the crisis.
13:18Petro in Colombia, of course, was the harshest,
13:22calling it the fault of the region's first far-right president,
13:25one who turned his back into a deposit for pensions and the national budget.
13:34In Brazil, we cannot forget Brazil, which has made history recently,
13:41but many followers of Flavio Bolsonaro went to Paraguay seeking refuge
13:55or seeking this Paraguayan miracle.
13:59The lawmaker and former ministers from Lula camp read the resignation as a setback for Latin America's right
14:09and pointed that Pena's ties to Flavio Bolsonaro's family also.
14:15So, it is really, really interesting.
14:20And you mentioned Argentina, the crisis crossed the border.
14:24When it didn't stay in Asunción,
14:27Caetel, a subsidiary of the tech firm ITTI,
14:31the service of some 40,
14:34they serve like 40 companies in the group.
14:38So, they have more than 900 workers in Buenos Aires.
14:43They suspended part of its staff for 30 days today without any pay
14:49and didn't pay October wages.
14:52They were, I think, we can think that they were expecting some kind of event
15:02when October started and one affected worker of this subsidiary
15:12said that the suspension came by email with no formal written notice.
15:19So, reading this politically,
15:22the Paraguayan miracle also exported precarious workers,
15:28Argentine workers who depended on Paraguayan financial groups
15:35are left out in the cold
15:37with an Argentine government that says nothing
15:40and the prophet Millay with no followers left.
15:45Pena's fall comes in the worst possible way
15:47and weak for Millay and his politics.
15:52Tomorrow of days,
15:54he racked up Flavio Bolsonaro's defeat
15:57on Tallulah in Brazil.
15:59The Republicans set back in the U.S. elections this Tuesday
16:03and Netanyahu's loss of a governing majority this week also.
16:10And we can add Orban's fall in April's week,
16:14weeks after Millay backs him in Budapest.
16:17And the pattern is really clear.
16:20So, what can we expect?
16:25Pena was the closest partner for Millay in Mercosur.
16:31He's counterweight to Lula and Uruguay shifts under Orsi.
16:38And he was the first president to visit Millay in Argentina
16:42in February of 2024, actually.
16:45He was the showcase, the country Millay held up
16:49as proof of his receipt, that his receipt worked.
16:56So, meanwhile, Millay is in Spain campaigning for Vox.
17:01Weeks before the November 29 election,
17:05the Argentine opposition is already joking about him being a jinx.
17:10And they are mocking him with a list of defeated allies
17:19and asked for one more for his own district.
17:24So, the real damage on the right of the whole region.
17:32But, of course, the damage on Millay,
17:36which was the first defender of the Paraguayan model,
17:43is being left alone.
17:45He loses a regional argument with Lula re-elected,
17:49with Orsi in Uruguay at the Paraguayan crisis.
17:53His project of Washington alignment with Mercosur
17:58has run out of partners.
18:00It is really not looking good for the right-wing parties
18:07in our region and in the whole American countries.
18:16So, we have to wait for tomorrow, I think,
18:22if I'm not mistaken.
18:26It's expected to have the defense of the president
18:30for the accusation received at the representative's camera,
18:39but we will have to wait.
18:43It's so clear, Agustina, everything that you were just mentioning.
18:47And I was thinking, all the links between these governments
18:51and, of course, I was thinking,
18:54they are not coming out to defend him.
18:58How could Millay come out and speak to the process of impeachment
19:02and the links with this private bank
19:06when Millay's government at home has so much issues
19:10with his links with private banks and online banking
19:14and the impact that that is having in Argentine households
19:18and indebtedness?
19:19This is an issue that spreads beyond the borders
19:23and it's at the core of many of these governments
19:26that have to do with these ties between holding the state
19:30but also participating directly or having direct links
19:34with these private companies that are profiting,
19:37in this case, with something so sensitive
19:39as where people are getting their income,
19:42where pensioners are getting their money as well
19:45to continue to live their day-to-day lives,
19:49something so sensitive like that
19:51and to have that as a supposed example of a miracle economy,
19:58have it crumble like it is crumbling right now
20:01and then have its allies, political allies,
20:04not say anything about it.
20:05It really speaks a lot.
20:07I don't know if we are still having Agustina in the call.
20:12Yes, now I see you.
20:13I see you in the call again.
20:15So, thank you so much, Agustina, for joining us with this.
20:19Just before we wrap up, we have a couple of minutes,
20:22but if you want to share with us final impressions
20:25about what you think that this means,
20:28we have Praguayans are in the street
20:30asking for accountability,
20:32asking for this to be held as an example of one moment.
20:38They do not want this even to just end with the impeachment.
20:41They want real accountability.
20:44So, do you think this could be one instance
20:47in which Latin American society can stand up
20:51and ask for these great companies to be held accountable
20:55if they rob the money of the population, for example?
21:01Yes, I think this is a model that works for, worked actually for Paraguay
21:10and it's working on Argentina as well
21:12with Marcos Galperin and Mercado Libre.
21:18But for, it's the financialization of the economies.
21:23And they, for two years, they have told us
21:26we had to look more to Paraguay and this model.
21:29And today in Paraguay,
21:31three million people can't get their money out of their banks.
21:34In Uruguay, that has a name, regulation.
21:37What they called red tape is what protects us,
21:43the institutions that protect us.
21:47And Paraguayans in the streets and the Paraguayans on feet
21:52trying to help accountability,
21:54not only to the president
21:58and trying to prevent the Colorado's party
22:02to isolate on and personalize this scheme,
22:08which is actually a scheme on Santiago Pena
22:14and call out on this model of economy
22:19that is playing with public money
22:23to fund and to promote their own interests
22:32and to play with the money
22:35and gamble with the money of the populations and peoples.
22:41And you were saying something that,
22:44but for me, it's really interesting.
22:48Who would have thought that,
22:50who would have told us two weeks before
22:53We need to close up the conversation right now.
22:57This would be the...
22:59Alucina, do you hear me?
23:00I'm so sorry.
23:01We need to close the conversation right now
23:03just because we have the end of the show.
23:06But I want to thank you so much
23:08because it was so important to continue the analysis.
23:12And as usual, I hope that we continue in further times
23:17to really come and see what this means.