Waterway Fee Dispute Escalates Between Paraguay and Argentina
Disagreements are growing between Paraguay and Argentina about the Paraguay-Paraná waterway.
These issues could reach Mercosur’s highest levels soon. Argentina started charging tolls on January 1, 2023.
In September, they seized a Paraguayan fuel barge. Even after a US$27,000 payment, the barge stayed seized.
This led Paraguay to summon Argentina’s ambassador. President Santiago Peña of Paraguay is filing a lawsuit at the Mercosur Tribunal.
Experts say Argentina shouldn’t have set tolls without talking to other countries. They think Argentina should justify the tolls by explaining their waterway upkeep costs.
The issue affects a lot of trade. Every year, 20 million tons of goods move between Paraguay, Bolivia, and Brazil’s Mato Grosso state.
Legal expert Mario Paz Castaing advises Paraguay to use Mercosur’s courts and diplomats. He says failing to do so could weaken the entire regional group.
He calls for a special meeting of Mercosur’s top council.
Domingo Peppo, Argentina’s ambassador in Paraguay, says the problem isn’t Argentina’s fault. He blames Paraguay’s actions for escalating the issue.
He says Argentina invests around 25 million in the waterway, and so Paraguayans should pay the fees.
Background
The Paraguay-Paraná waterway has a long history of being a crucial trade route. It links Bolivia to the Atlantic Ocean, passing through several countries.
Historically, this route has operated under shared governance, making unilateral tolls unusual.
In 2012, Paraguay was suspended from Mercosur, signaling past tensions in the group.
These tolls could have a broad economic impact, affecting not just Paraguay but other states like Bolivia and Brazil.
Resolving this dispute quickly is essential to maintain smooth trade flows. Previous issues in the Mercosur bloc have often required high-level diplomatic intervention.
If not handled well, this toll dispute could be another blow to the unity of the Mercosur countries.
Key Facts
— Deep Dive
— For the complete picture, read our in-depth guide: Paraguay: Washington's Most Valued Ally in Latin America
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This article was drafted with automated assistance and reviewed before publication. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief