Óscar “Nenecho” Rodríguez, mayor of Asunción, submitted an “Administrative Reorganization Plan” to the Municipal Board. It consists of a new indebtedness of G. 565 billion (US$ 82.2 million) to pay the maturity of debts contracted in previous years that cannot be paid.
Federico Franco Troche, former councilor of Asunción, explains that this plan will only mean a “cycling” of debts that will only further compromise the financial situation of the municipality.
“What the mayor says is that we are in a difficult situation, maturities of debts contracted in previous years are going to accumulate and we do not have the resources to pay. Before generating an institutional reengineering in order to avoid this situation of continuous indebtedness, he proposes a new indebtedness of G. 565 billion (US$ 82.2 million). This is not debt rescue, it does not mean administrative reorganization of the municipality. Contracted debts mean greater tax pressure on citizens”, he warned.
On the other hand, Franco questioned that to make discretionary use of this indebtedness, the commune requests the declaration of fluvial emergency in the city. A statement that is not justified since it is not a pandemic like that of Covid-19.
“Given that we are on the eve of internal elections, generating those resources without having the ability to pay in subsequent years is something really serious due to the history that exists. Especially since the uses that have been given to emergency resources have not been transparent, on the contrary, there are complaints that rest in the Prosecutor’s Office, ”he said.
FALLACIES
Finally, he questioned that the mayor is used to giving messages to delimit responsibility for the financial situation of the municipality, saying that no previous administration foresaw the ability to pay in the future. But, this turns out to be a fallacy, looking at the history during the last two years where he was as mayor.
“He six times the deficit that the municipality had been carrying in previous administrations. In his as in his interim, they deepened with loans that the commune did not have the capacity to absorb, ”he pointed out.
Finally, he said that this “Restructuring Plan” represents a Trojan Horse that appears as something that seems novel that will respond to a delicate financial situation but in reality, it will only present more debts.
“It could definitively destroy the institutional capacity of the commune to meet any demand such as storm drains and more. If we don’t have a healthy institution, we won’t be able to commission major projects”, he concluded.
