2023-05-14 11:00:22
Santiago Peña has just achieved a resounding victory in the Paraguayan elections nominated by the Colorado Party, the conservative force that has controlled that country for almost the last 70 years. A US graduate economist and former IMF official, former Central Bank board member and former finance minister, an intense career path for his 44-year-old, he does not feel comfortable being characterized as a liberal.
In this interview with Clarion defends the notion of a necessary political center in his country and the region; He praised the Brazilian Lula da Silva and affirmed that he waits for what happens in the elections in Argentina in order to advance in Mercosur.
-In a region with governments that are said to be left, do you open a new instance?
-I think that the victory reflects the feeling of Paraguay and the Paraguayans. Certainly my profile can be seen as a more right-wing profile, but in reality it is a nationalist vision of the development of Paraguay. The Colorado Party is centennial. He has also been able to understand the moments in history and the feelings of the population.
I somehow reflect a more modern vision of politics, of the public sector. It is not a question of whether we move more to the right or to the left. Here is how we move forward. I think that was the speech that won, beyond an ideological inclination to either extreme.
-What effects is the global economic crisis producing in the region? Do you see a shift of electorates to the center as in the Brazilian case?
-Socialism had its failures, but neoliberalism was also clearly a failure. We have to find the balance in the center again. I believe that strong, present States are fundamental in those areas where the State has a role that cannot be delegated. Public services such as health, education, security, the State will always be the only one capable of solving these problems in a fair and equitable way for all.
But also the only way to generate wealth is through job creation, investment, and there we need a market economy that recognizes private property, recognizes the rule of law above all, and States at the service of citizens and By this I also mean companies. This does not mean that the state has to be subject to private capital, but rather that we are great allies.
Mercosur
– Do you agree with Uruguay in the sense of generating an opening in Mercosur?
-We have to recognize that since the signing of the Asunción treaty in ’91 to this part there have been enormous advances in terms of economic integration. Now, when we compare it with other economic blocs such as those in Southeast Asia, the European Union, we are clearly far from an ideal scenario.
-How do you progress then?
-What we have to do is not look critically at the past 30 years, but project a much better future, where we advance in this integration process.
-How do you imagine?
-That integration has to be respectful of the political processes, because it is through politics that the peoples express themselves, we have to understand the moments. Today in Brazil, I believe that this third presidency of Lula can be emblematic for Paraguay, Uruguay and Argentina, of course for Brazil, to be able to leave a legacy for the future.
And well, waiting for what happens in Argentina, in the months of October and November so that there, yes, the four countries can unite and from a pragmatic perspective we can say, we decide to move forward.
– Do you see yourself governing in Mercosur with a proposal like Javier Milei’s? Paraguay has a leader with a similar profile, Payo Cubas, who was nicknamed the “Milei de Paraguay”
I think they are totally different proposals. Clearly there is a similarity in that we are both economists. We use much of the historical evidence of public policies, but clearly his gaze responds to the Argentine context, where unfortunately 70 years of fiscal deficit have led to Argentina having to remove 16 zeros from its currency.
So the proposal is very radical, which is like a response to the economic situation in Argentina. Unlike Paraguay, which historically has had a much more prudent macroeconomic behavior. It is not my merit that I was a minister or president of the Central Bank, but it is the conquest of a society that has understood that macroeconomic stability is a public good.
-It is an interesting concept in a region that has had serious failures in the management of the public treasury
-My proposal is that on these macroeconomic foundations I have to build a more developed state that generates high-level human capital. Health, education, infrastructure, that allows Paraguay to go from that Paraguay of 5,000 dollars per capita, to a Paraguay of 10,000 dollars, which is the average for South America, and then project ourselves to high-income countries, which are in 25 thousand, 30 thousand dollars per capita.
Stability is not impossible
-To what extent is it a challenge today to achieve that macroeconomic stability?
-In the case of Paraguay I would not tell you that it is an impossible challenge, we have shown it. This year we are going to celebrate 80 years of our currency, the guaraní. In that same period, Brazil went through innumerable cases of instability, the real plan, the crossed plan, hyperinflation. The same thing happened to Argentina, the same thing to Bolivia, the same thing happened to Uruguay.
As Augusto Roa Bastos said, Paraguay was an island surrounded by land. And that isolation also allowed Paraguay to shield itself from these political and economic ups and downs. I am convinced that Paraguay is a country doomed to success. To the extent that we can project and insert ourselves into an increasingly competitive world, a world that needs food, that needs water, a world that needs stable scenarios.
-You manifest yourself as a center, are you worried or afraid of governing in parallel with leaders of more rigid liberal ideas, as we pointed out in the eventual case of Argentina?
-No not at all. I think that if the Argentine people finally turn to a figure like Milei, for example, hopefully they have the ability to make changes. Argentina needs to make very profound economic changes. And these changes are going to have and are going to imply a very high short-term social cost for a long-term benefit.
-When you were recently asked about the tensions that influence the region between the US, China or Russia, you recommended being guided by “national interests”. Does Paraguay have diplomatic relations with Taiwan and not with China, how does this matter influence and how does it influence Mercosur?
-We relate to China much more than with Taiwan. Paraguay sources products from mainland China, and China is the main buyer of Paraguay’s biggest export product, soybeans. Now, we have a diplomatic relationship with Taiwan, for 66 years.
And we share principles and values. This world we live in, which is no longer the bipolar world of the Cold War, is a multipolar world. I believe that what must prevail are the national interests of each country. We may have a very important affinity with the United States, but we also have a very deep commercial relationship with China.
– How do you see the link with Russia with the circumstance of the war against Ukraine?
-Paraguay has a very deep commercial relationship with Russia, one of the main export markets for Paraguayan meat. But we cannot but sympathize with Ukraine. In Paraguay 153 years ago the cruelest war ended where we lost 60% of the territory, 90% of the male population and it was precisely the invasion of the greatest on the weakest. (The War of the Triple Alliance in which Brazilians and Argentines destroyed the Paraguayan population)
Will you join these proposals to start up organizations like Unasur promoted by Brazil?
-I have a strong vocation for integration. It embodies me to defend my ideas, but also to listen to the ideas of others. I am not afraid that we do not all share the same vision. Yes, I agree that we can sit at the table, call yourself UNASUR, CELAC, Mercosur, the Pacific Alliance. I believe that one of the great consequences of the pandemic has been a process of disintegration, we have concentrated more and more on looking within our territory and this has delayed the integration process.
We are discussing whether the waterway is going to be controlled by China or by the United States. The waterway has to be controlled by the countries that are part of the waterway. So I will try to do is try to be that voice that can bring good sense and rationality to political decisions that have a huge impact in that region and in the world.
-Speaking of the waterway, there is a latent claim from Paraguay that does not want Argentina to charge tolls as it is already doing.
-We have to streamline trade, reduce and not add costs. Finally, we end up transferring these costs to the final consumer and people go to buy another product.
-That is, it is against the collection of that toll as is the outgoing government of Mario Abdo Benitez.
-In addition. The toll is one of the issues we have to discuss. We have to discuss signaling, dredging, making it navigable 365 days a year. This is the most important route in our country and generates very important business and could mean a repositioning of Mercosur and South America in international markets.
Apart from the waterway, today we have a connection channel that is the bioceanic route, which joins the Atlantic with the Pacific and passes through the center of Paraguay. There are innumerable issues that I would love to be able to carry out from the presidency of Paraguay.
Natasha Blueflower
Marcelo Cantelmi
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