Theme: Paraguay

35 lawmakers submitted impeachment articles against President Santiago Peña in the 80-seat lower house on Wednesday and requested an extraordinary session on Thursday to debate the matter, according to Reuters. The opposition accuses Peña of conflicts of interest, misuse of pension funds and institutional cover-ups in the bank case. Paraguay's central bank intervened in Ueno after finding minimum solvency requirements breached, leaving about 3 million customers in a country of 6.5 million people unable to access their accounts. The opposition still lacks the two-thirds majority needed to advance impeachment but has won backing from dissidents of the ruling Colorado Party.

Santiago Peña announced a proposal to reimburse 98% of savers this week and named a new Central Bank of Paraguay (BCP) president after Carlos Carvallo's resignation. Ueno Bank has 2.9 million customers, about 40% of Paraguay's population, processes close to 3 million transactions a day and handles two-thirds of electronic payments at the big retail chains. The central bank decided unanimously to start resolution proceedings against the bank; according to the Public Prosecutor's Office, it faced severe insolvency, with capital below half the required minimum. Peña was a shareholder in Ueno's controlling group until April 2025, and Carvallo ran Financeira Ueno before Peña appointed him to the central bank in 2023; he left the post on Tuesday at the president's request, and Peña canceled his trip to the Ibero-American summit in Madrid because of the crisis.

The Central Bank of Paraguay ordered the intervention of Ueno Bank after finding a solvency ratio below 50% of the required minimum, following adjustments to its balance sheets during the regularization process. President Santiago Peña asked for the resignation of Central Bank president Carlos Carvallo and agreed with the heads of both chambers of Congress on a bill authorizing the use of the Guarantee Fund to start immediate payment to savers, including public funds and the IPS. Peña was a business partner of the bank until March 2025 and gave up his shares after criticism over a conflict of interest; the institution, linked to former business partners of the president, held hundreds of millions of dollars in public resources, including investments from Paraguay's social security system. On Wednesday, lawmakers began collecting signatures to file an impeachment request against Peña and Vice President Pedro Alliana. On Tuesday night, account holders and retirees protested outside the National Congress and the presidential residence, demanding the return of the blocked money and that authorities be held accountable.

Paraguay’s central bank board voted unanimously on Monday to put Ueno Bank into resolution, after its solvency ratio fell below half the legal minimum; the bank says it has about 3 million customers and manages $800 million to $850 million in public money, including about $380 million from the state pension and health fund; prosecutors sought the arrest of eight people, including President Juan Manuel Gustale and chief executive Federico Miguel Vázquez Villasanti; and President Santiago Peña canceled a trip to a summit in Spain, asked central bank chief Carlos Carvallo to resign, and promised to fast-track depositor repayment legislation. Peña’s party vice president Rodolfo Friedmann called for the president’s expulsion, while Senate President Basilio Núñez defended him and blamed the central bank.

Paraguay’s central bank seized Ueno Bank, a major digital lender with close ties to President Santiago Peña, over a solvency problem. Hours later, on Tuesday, Peña asked the head of the central bank, Carlos Carvallo, to resign. Carvallo said he had already signed his resignation letter but would stay on to oversee the takeover, because “the central bank needs calm to do its job.” Peña canceled a trip to a summit in Spain and agreed with congressional leaders to fast-track legislation that speeds up payouts to depositors and the return of public money.

The United States announced a partnership between an American company and a Paraguayan developer to build a high-performance computing facility powered by the Itaipu hydroelectric plant, on the border between Brazil and Paraguay, according to G1. According to the US State Department, the project should serve cloud computing customers in the United States and Latin America.

Paraguay’s technology minister, Gustavo Villate, said on Thursday that sanctions imposed by Beijing would only accelerate joint projects with Taiwan and wrote in a social media post that the relationship with Taipei would “never be on the negotiating table”. On Monday, China sanctioned Villate and Belize’s foreign minister over the two countries’ ties with Taiwan, which Beijing claims as its own territory.

China imposed sanctions from Monday on Paraguay's communications minister and Belize's foreign minister over the two countries' ties with Taiwan, according to Reuters, in a text republished by Internazionale. The measures include barring entry visas to Hong Kong and Macau and prohibiting Chinese organizations and individuals from engaging in transactions, cooperation or other activities, the ministry said in two notices.