Weekly Report - 28 July 2016 (WR-16-29)

The Paraguayan government led by President Horacio Cartes is preparing to contest a legal action taken against the state-owned oil firm, Petropar, before the International Chamber of Commerce (ICC). The action was taken by Venezuela’s state-run oil firm, Pdvsa, and relates to the outstanding debt that Petropar has with it. The two cash-strapped firms disagree over the size and terms of the debt and each one appears determined to get its way. The case thus looks set to put Southern Common Market (Mercosur) members Paraguay and Venezuela at odds with each other once again, which will only heighten the existing political tensions within the regional trade bloc.