Caption: Santiago Pena
ASUNCION, Paraguay (AFP) – Thousands of Paraguayans gathered outside Congress on Thursday to protest against President Santiago Pena, whose resignation is pending as lawmakers prepare to go ahead with impeachment proceedings instead.
“Give back the money,” AFP journalists heard demonstrators yelling after the takeover of a bank linked to Pena blocked millions of people from accessing their accounts.
Pena, who stepped down amid a chaotic banking scandal, said he would attend his impeachment trial while his resignation awaited approval from lawmakers.
“I will appear and exercise my right to a defence. I will do so with arguments and evidence, with respect for the Constitution and the institutions of the Republic,” he wrote on X.
It took just two days for Pena to resign after a banking crisis blocked nearly half of the small South American country’s population from accessing their money.
The Central Bank’s takeover of Ueno Bank on Tuesday has plunged Paraguay into a political crisis. Angry protests have erupted around the country and, on Thursday, lawmakers voted unanimously to launch impeachment proceedings against Pena. But the US-allied leader beat them to the punch by resigning minutes beforehand.
Takeover
On Tuesday, the Central Bank seized control of Ueno because of a severe capital shortfall, in order to “protect depositors and preserve the stability of the financial system.”
Ueno Bank says it has more than three million customers in a country of 6.4 million people, and manages millions of dollars in pensions and other state funds.
Authorities issued arrest warrants for eight of Ueno’s top executives. The bank’s president, Miguel Vazquez, turned himself in to police, while Central Bank president Carlos Carvallo, who formerly chaired Ueno, resigned at Pena’s request.
Pena, who took office in 2023, owned shares in a group that controlled the crisis-hit bank, but he sold them last year.
Fury
Scrambling to contain the situation, Pena on Wednesday enacted a law to return most deposits within five days.
Meanwhile, 35 lawmakers filed a motion to impeach him, along with Vice President Pedro Alliana. They accuse Pena of a conflict of interest and of favouring Ueno through regulatory decisions and the placement of pension funds.
On Wednesday evening, protests roiled Asuncion for the second day in a row. “Give us our money back,” hundreds of angry depositors chanted, while some waved placards calling for a presidential impeachment. Others clashed with police, who used tear gas and water cannons to disperse the crowds.
Downfall
On Thursday morning, Pena’s own Colorado Party turned against him, with party leader Horacio Cartes announcing that he backed impeachment.
The Chamber of Deputies opened a session to debate the motion, but no sooner had it started than Pena posted a video on X announcing his resignation.
“I want to apologise to the people if at any point I failed. It was never my intention to betray the trust you placed in me,” he said.
Minutes later, the 78 deputies present unanimously approved the impeachment motion against Pena. In a second session, the chamber rejected the request to impeach Alliana by 48 votes to 30.
Both chambers of Congress must decide whether to accept or reject Pena’s resignation. A rejection would lead to a Senate trial to determine his liability in the scandal of national proportions.
If the presidency is declared vacant, Alliana must complete the term through 2028.
