Brazil & Southern Cone - March 2014 (ISSN 1741-4431)

The surprise 3 March decision by Paraguay’s attorney general (AG), Javier Díaz Verón, to replace his chief anti-corruption prosecutor, Carlos Arregui, has led to intense speculation that it was a politically-motivated decision designed to shield various members of congress currently being investigated on corruption allegations. The issue has become the main political talking point in Asunción, with the government led by President Horacio Cartes under growing pressure to show that this was not the case; and that its commitment to fighting corruption is strong even when it involves going after influential figures in the ruling Asociación Nacional Republicana- Partido Colorado (ANR-PC).

As the head of the AG’s economic crimes and anti-corruption unit, Arregui was in charge of investigations into a series of corruption scandals (at least six) affecting legislators from the country’s three main political forces: the ANR-PC, the centre-right opposition Partido Liberal Radical Auténtico (PLRA) and the Frente Guasú (FG) leftist opposition coalition. These allegations were first levelled in the media in November 2013.

Official corruption has a long history in Paraguay, where it became deeply entrenched under the long military dictatorship led by General Alfredo Stroessner (1954-1989). But since the return to democracy in 1990 and the historic election defeat of the ANR-PC in 2008, things have been changing gradually and Paraguayans have grown increasingly intolerant of graft by their elected political representatives. The public reaction to the latest allegations was one of outrage; and that outrage was only exacerbated by the nonchalant way in which the allegations were first treated by congress.

After the senate narrowly voted against stripping ANR-PC Senator Víctor Bogado of his immunity so that could face investigation (as the first politician hit by the press allegations), there was public uproar. Social organisations staged mass demonstrations calling for Bogado’s impeachment, while local businesses launched a ‘civic campaign’ in which they refused to provide services to Bogado, his family and all of his 23 colleagues in the senate who had voted against removing his immunity.

This campaign against the ‘senaratas’ (‘rat senators’) was a success. After senators were booed and chased out of shops by members of the public, the senate held an extraordinary session and did an about-turn, voting on 28 November in favour of removing Bogado’s immunity. Both houses of congress also agreed to consider stripping the immunity of any other members facing formal corruption accusations after the long Christmas/summer recess (sessions resumed on 1st March).

Since then, more corruption allegations have emerged, primarily affecting ANR-PC legislators and former government officials, leading a group of ANR-PC congressmen led by Senator Enrique Bacchetta to accuse the local media of a ‘witch hunt’ against the ANR-PC. Bacchetta and his colleagues have also been highly critical of the anti-corruption prosecutors, accusing them of taking on cases to “please the press”. Bacchetta even suggested that the official anti-corruption unit itself should be investigated by congress for “poor performance of its duties”.

Suspicious changes

It was against this backdrop that soon after congress returned from recess  - and with the immunity of a growing number of legislators up for consideration - that AG Díaz ordered a reorganisation at the public ministry, as part of which Arregui was named the new district attorney for Central department. He was replaced by the district attorney for the Chaco region, Federico Espinoza. Arregui’s transfer raised immediate suspicions, after he told the press that he hadn’t expected to be moved just as he was working on a large number of important cases. He said that he would consider resigning in protest at this “demotion”.

In an official communiqué, Díaz said the changes were part of an administrative shakeup aimed at “improving the functioning of the public ministry and optimising results”. This failed to wash. Nine of Arregui’s 11 deputies signed a statement rejecting the decision on the grounds that it would “weaken the work being done by the unit and create uncertainty about the state of current investigations, especially those affecting members of the legislature”. They called on Díaz to reconsider. Díaz met with Arregui and his colleagues on 6 March to explain the changes, but afterwards declared that the decision was final.

Díaz’s refusal to reconsider prompted the Coordinadora de Abogados de Paraguay (CAP), the main association of lawyers, to issue its own public statement denouncing the decision as the clear result of “pressure exerted by certain political groups”. This was echoed by Arregui himself in tendering his resignation on 7 March. Stating that he respected Díaz’s power as AG to order his transfer, Arregui said that nonetheless he did not agree with the decision, “because I am convinced that it was influenced by political reasons… last year we opened a series of investigations that everyone knows implicates people with a lot of political influence…  I think that the Attorney General has come under pressure [from these people], that is my conclusion”.

Cue political firestorm

While Arregui and the CAP were careful not to point to any specific political group as responsible for pressuring Díaz, suspicions immediately turned to the ANR-PC. The press, along with some local social activists, have accused Senator Bacchetta of forcing the decision. Both Bacchetta and Díaz have strenuously denied the accusations (see sidebar), but a public campaign in repudiation of Bacchetta and calling for Díaz’s resignation has been launched, with a march on congress scheduled for 21 March.

All of this has been seized upon by the opposition to attack the Cartes government. PLRA Senator Carlos Amarilla declared that he was “absolutely convinced” that President Cartes himself had ordered Arregui’s removal in a bid to shield corrupt ANR-PC legislators from prosecution. Amarilla has said that he will promote Díaz’s impeachment by congress. It is unlikely that any motion to impeach Díaz would prosper, as the ANR-PC has comfortable majorities in both chambers. However, such remarks increase the pressure on President Cartes, who has made a conscious effort not to get involved in the scandal, to say something.

It also provides the PLRA and the rest of the opposition with another excuse to refuse the president’s invitation to join with him in a national political dialogue aimed at building broad-based consensus behind his proposed reform plans, amid growing signs of social discontent (see sidebar). Upon his arrival back from Chile, where he attended the inauguration of President Michelle Bachelet, Cartes said he would like meetings with the opposition parties to present the finer details of his government plan. He recently met the ANR-PC leadership [RBS-14-02] to consolidate support for his plan. But the invitation was immediately rejected by the PLRA and the FG, who said that they were not interested in listening to Cartes’ ‘monologue’, but wanted to discuss a broader agenda. Cartes may not technically need the opposition’s political support in congress, but he may need their backing should the current public discontent continue to spread.

• General strike called - On 26 February peasant farmer associations, labour unions and student unions grouped in the Coordinadora Democrática (CD) called for a national strike on 26 March in repudiation of the government’s economic policies. A statement urged other social organisations to adhere to the strike in “condemnation of the deterioration of the quality of life and the threat to the livelihoods of poor families, for the benefit of multinational corporations”. The CD wants a 25% general salary increase, a reduction in public transport fares to G$2,000 (US$0.46), and the repeal of the recently approved public-private-partnership law. Unions representing teachers, public health workers and airport workers unions have said they will join the strike.

• Díaz, Bacchetta deny accusations - At a 6 March meeting with the local Catholic Church’s Episcopal conference, Attorney General Díaz strenuously denied that he had ordered the replacement of the chief anti-corruption prosecutor, Carlos Arregui, because of political pressure. Díaz, who agreed to meet the Episcopal Conference to personally answer questions about this controversial decision, admitted that the timing may have been “inappropriate”, but he insisted that “political pressure did not play any part”. Senator Enrique Bacchetta also denied any role in Díaz’s decision, noting that Díaz himself had explained that it was an “administrative decision”. Bacchetta accused “certain sectors in the press of trying to harm me”.