The review of Annex C in the Binational Treaty between Brazil and Paraguay, overseeing the billion-dollar resources of the Itaipu hydroelectric plant, is projected to take 2-3 years, according to the Brazilian director general of Itaipu, Enio Verri.
Negotiations will officially commence on August 13, following the inauguration of the new Paraguayan government.
The review is considered crucial as it will determine the future allocation of Itaipu’s substantial resources, previously used for the installment payments of the plant’s construction half a century ago, the last of which was paid in February.
The plant reportedly holds a yearly cash surplus of about US$2 billion.
There is an ongoing debate on how to utilize these funds best.
Some advocate for investment in significant structural projects, as seen under the previous government.
However, the Brazilian government indicates a preference for investment in technology, research, and social initiatives.
Enio Verri stresses the importance of foreign ministers from both countries in the negotiations, which will need to be approved by both nations’ presidents and national congresses.
This process is expected to be lengthy, potentially extending beyond the initial estimate of 2-3 years.
As a binational entity, Itaipu operates under its unique legislation.
Its operations are overseen by six representatives from Brazil and Paraguay, with consensus needed for all decisions.
The functionality of Itaipu will continue as is during the negotiation period.