Infrastructure as a diplomatic tool: the role of Itaipu in Brazilian foreign policy discourse and practice (1960-1979)Abstract
This article examines Brazil’s diplomatic strategy in creating the Itaipu hydroelectric dam, emphasizing its cooperative frameworks with Paraguay and Argentina to foster regional integration. It analyzes how Brazil leveraged the Itaipu negotiations (1960-1979) to balance national interests and regional cooperation. By using process tracing, the study examines the negotiations surrounding the signing of the Cataratas Agreement (1966), the Itaipu Treaty (1973), and the Tripartite Itaipu-Corpus Agreement (1979). Three causal mechanisms help explain the outcomes achieved in each historical context: national interest, need for cooperation, and pressure from public opinion. The research highlights Brazil’s diplomatic maneuvers in the agreements, showing how these efforts reinforced Brazil’s role as a cooperative regional hegemon while advancing broader regional goals.
infrastructure; diplomacy; transboundary waters; Itaipu; Brazilian foreign policy; process-tracing
Introduction
The role of infrastructure in the construction of political and social reality has become a subject of significant interest among scholars in the field of International Relations (IR) in recent years. The importance of infrastructure in IR is linked to two main aspects: the first relates to the crucial role these artifacts play in an increasingly interconnected world, dependent on these material networks; the second concerns the political dimensions that shape the construction of infrastructure, especially large-scale projects.
As noted by Bueger et al. (2023, 2) “infrastructures are both constitutive of, and constituted by politics, and shape the conditions of possibility of global affairs.” The political dimension becomes even more relevant in a world where the construction and provision of infrastructure have become a means for states to leverage their global influence (Neves and Honório 2024). The disputes between the United States (US) and China regarding the provision of these artifacts account for most of the literature produced on the subject (Luft 2016; Chen 2021; Petry 2023). In this sense, little attention has been given to the political role that infrastructure plays for middle powers, which possess the capacity to provide such services within their regional contexts.
This article contributes to the debate on infrastructure in international relations by presenting the case of the Itaipu hydroelectric dam’s construction. This project was built through a joint effort between Brazil and Paraguay (Menezes 1987). The negotiation process for the construction of Itaipu was complex. The hydroelectric dam harnesses the transboundary waters of the Paraná river for electricity generation. The Paraná river is, in turn, shared by Argentina, Brazil, and Paraguay. The realization of Itaipu required a significant diplomatic effort from Brazil to reconcile all the political and technical issues that the project demanded (Betiol 1983). As will become clear throughout this work, in addition to the objective of generating electricity, Brazil leveraged the construction of Itaipu as a diplomatic tool to advance its regional foreign policy agenda.
Thus, there are two political dimensions involved in the construction of Itaipu: the first concerns the political clashes that its construction caused between Brazil and Paraguay; the second is related to the sharing of the Paraná river’s waters between Argentina, Brazil, and Paraguay, and the political need to reconcile the interests of the three parties. The research question guiding this work is: in what ways and to what extent did Brazil use the construction of Itaipu to promote the interests of its regional foreign policy? The answer is provided through the analysis of official and journalistic documents produced in three periods: i) the signing of the Cataratas Agreement (1966); ii) the signing of the Itaipu Treaty (1973); and iii) the signing of the Tripartite Itaipu-Corpus Agreement (1979).
These periods represent distinct moments in which Brazilian diplomacy developed strategies regarding the defense of its national interest, both discursively and practically, with respect to the construction of Itaipu.1 The results of this article demonstrate how the construction of infrastructure projects creates opportunities for middle powers, endowed with the necessary material capabilities, to promote their regional foreign policy agenda. The research also provides insights into how infrastructure projects create incentives and political opportunities for cooperation and regional integration.
Notwithstanding the fact that geographic particularities impose contingencies on the technical aspects involved in the construction of infrastructure projects, the political dimensions of cooperation in such contexts follow patterns similar to the Itaipu case. In this sense, the article also provides interpretations regarding the formation of agendas around cooperation and regional integration in contexts of shared infrastructure and the use of natural resources.
The article consists of four topics in addition to this introduction. The first topic provides a literature review aimed at exploring the connection between infrastructure and diplomacy. The next topic presents the research methodology: process-tracing. Following this, the empirical analysis results of the three historical periods related to the construction of Itaipu are presented. The fourth topic discusses the research findings, demonstrating the implications of the Itaipu construction for the discourse and practice of Brazilian foreign policy. The article concludes with the final remarks on the relationship between infrastructure, diplomacy and foreign policy.
Infrastructure as a diplomatic tool
Infrastructure plays a crucial role in diplomatic processes by facilitating trade, enhancing connectivity, and fostering economic and political cooperation (Vidya and Taghizadeh-Hesary 2021). The development of both hard infrastructure, such as roads and ports, and soft infrastructure, including regulatory frameworks and institutional arrangements, significantly shapes the relationships between nations (Zaninovic et al. 2024). The European reconstruction after World War II through the Marshall Plan and the creation of the North Atlantic Treaty Organization (NATO) exemplify how these two types of infrastructure can be leveraged as diplomatic tools to consolidate alliances and stabilize geopolitical regions (Grgić et al. 2023). By investing in physical rebuilding and institutional frameworks, the US government not only facilitated economic recovery in Europe but also countered Soviet influence, highlighting the strategic importance of infrastructure in global diplomacy (Leffler 1988).
Recently, the role of infrastructure in political dynamics has become a focal point in academic research (Bueger et al. 2023). This renewed interest emerges in a context where China has positioned itself as a key provider of infrastructure financing and construction services worldwide, particularly through its Belt and Road Initiative (BRI) (Chen 2021). This initiative, involving over 140 countries, seeks to create trade corridors and enhance global connectivity, but has also been criticized for creating dependency through debt and increasing China’s geopolitical leverage (Jones and Zeng 2019). Significant portions of the research on this topic aim to understand how these dynamics influence diplomatic, political, and economic relations between China and other nations (Freeman 2017; Becard et al. 2020; Petry 2023). For instance, China’s investments in Africa have sparked debates on whether they represent genuine development aid or a new form of neocolonialism.
Moreover, researchers have increasingly focused on how technological infrastructures, such as telecommunications and data centers, create opportunities for both private and state actors to influence international relations (Plantin and Punathambekar 2019). The proliferation of digital connectivity has introduced new dimensions to diplomacy, often referred to as “digital diplomacy”, where states use technology to project soft power, disseminate narratives, and even engage in cyber strategies. The deployment of 5G networks by Chinese companies, such as Huawei, has become a contentious issue in global politics, with countries like the US and its allies arguing that these networks could be exploited for espionage, thus intertwining infrastructure with security concerns (Westhuizen 2024).
Despite this growing body of research, there remains limited exploration of how and to what extent infrastructures influence regional relations (Grgić et al. 2023). The regional context can be shaped by both external actors, such as foreign powers investing in infrastructure, and local actors who use these projects to pursue political interests (Wilson 2019). Infrastructure projects not only provide material benefits but also serve as tools for states to assert influence and legitimize their presence in a region. The construction of large-scale infrastructure, such as Itaipu on the Brazil-Paraguay border, exemplifies how such projects can redefine regional political and economic dynamics (Espíndola and Ribeiro 2020). Itaipu not only resolved bilateral disputes over water resources but also symbolized Brazil’s aspirations to consolidate its leadership in South America (Blanc 2018). The dam served as a platform for fostering regional cooperation (Cervo 2007, 181-190), but it also highlighted the asymmetries of power between the countries involved, raising questions about equitable partnerships in transboundary projects of infrastructure (Folch 2016).
Furthermore, considerations regarding the role of infrastructures for middle power countries with the capacity to provide these services remain underexplored in the literature. Nations like Brazil have historically employed infrastructure projects as diplomatic tools to strengthen ties with neighboring countries in South America and African nations (Dye and Alencastro 2020; Campos and Silva 2024). For instance, during the mid-20th century, Brazil financed and constructed highways and bridges to connect its territories with bordering countries, facilitating trade and political dialogue (Saraiva 2010). In the early 21st century, Brazil’s engagement with Africa through infrastructure investments, underscored its ambition to act as a bridge between the Global South, leveraging shared historical and cultural ties (Saraiva 2010).
As pointed out above, infrastructure extends beyond its functional role to become a strategic instrument in international relations. From post-war economic and institutional reconstruction to the projection of global influence through large-scale transnational initiatives and the transformation of diplomatic practices via digital interconnectivity, infrastructure emerges as a fundamental driver of power and cooperation. Nevertheless, the literature also highlights challenges, including asymmetries in partnerships, geopolitical tensions, and the risks of economic dependency. This range of perspectives reflects the complexity of the subject, emphasizing the need for further scholarly inquiry into regional contexts and the specific contributions of emerging actors, such as Brazil, in leveraging infrastructure projects to integrate development objectives with diplomatic strategies.
This research contributes to this agenda by offering a historically grounded and empirically informed analysis of the Itaipu project, demonstrating how Brazil mobilized infrastructure not only as an energy solution but also as a vehicle for projecting regional leadership and constructing a cooperative diplomatic framework with its neighbors. By tracing the discursive and strategic shifts in Brazil’s foreign policy across key moments of the Itaipu negotiations, the study provides new insights into how infrastructure can serve as both a source of tension and a platform for regional integration.
Methods
This research employs process-tracing in an adaptation designed for studies in the field of Foreign Policy Analysis (FPA) (van Meegdenburg 2022). The application of process-tracing enabled the identification of causal relationships between Brazil’s discursive and decision-making processes regarding the construction of the Itaipu hydroelectric dam and the political outcomes of these actions. By adopting process-tracing, the aim was to go beyond mere historical description, offering a more nuanced analysis. However, this research does not intend to establish a deterministic or generalizable model. Instead, its analytical propositions take into account the contextual contingencies inherent to the processes under examination.
For this reason, the decision not to adopt a case study methodology was intentional, as this approach is generally better validated when its results can be reproduced in other contexts (Levy 2008). By focusing on Brazil’s discursive interpretations and narratives as a means of establishing causality, the primary interest lies in the outcomes of these actions rather than the intentions underlying the discursive dimension. Consequently, discourse analysis was also not considered a viable methodological option for this research.
The process-tracing model adopted employs causal mechanisms through an analytic-interpretivist approach as defined by van Meegdenburg (2022). In this framework, historical analysis is conducted to extract insights that are also relevant to the present (Schrag 2021, 15). Nevertheless, it is important to clarify that these mechanisms can yield different outcomes even in cases where structural circumstances similar to those analyzed are present.
van Meegdenburg (2022) proposes the concept of mechanisms as analytical constructs. This dimension of mechanisms is guided by a Weberian perspective of ideal types, where mechanisms are understood as an “abstraction that captures the essence of a social phenomenon” (van Meegdenburg 2022, 409). In this sense, by treating mechanisms as analytical constructs, the research aims to: “(a) study how a mechanism or concatenation of mechanisms led to a particular outcome; (b) assess how the mechanism(s) functioned in a given context; and (c) abstract from the specific instantiation(s) more general propositions about foreign policy making” (van Meegdenburg 2022, 405).
This proposal for the use of process-tracing aligns with the objective of this research, as it not only provides guidance for analyzing the results but also adds depth to the analysis. In the historical contexts analyzed, three causal mechanisms that help explain the outcomes achieved were identified: (i) national interest, (ii) need for cooperation, and (iii) pressure from public opinion. Thus, there is a continuity of these mechanisms influencing the production of outcomes throughout the entire period of analysis (1960–1979). Nevertheless, some mechanisms operated with different degrees of intensity in each of the three contexts (see the subtopics of the fourth topic). Considering the element of continuity identified in the analysis, the topic on the dam’s construction and its impact on Brazil’s foreign policy presents a conceptual classification of the outcomes in each historical context. This classification is useful in demonstrating that, despite the element of continuity, each outcome contributed separately to the achievement of Brazil’s desired result. This classification may also be useful for analyzing contexts similar to that of Itaipu.
The sources analyzed consist of official documents produced by the Ministry of Foreign Affairs (MRE) of Brazil, which were gathered from historical archives and online collections at the Center for Research and Documentation of Contemporary History of Brazil at the Getúlio Vargas Foundation (CPDOC-FGV). Additionally, contemporary journalistic sources are used, which are available through the Brazilian Digital Newspaper Archive of the National Library Foundation.
Itaipu and its production of political meaning in three historical contexts
The Cataratas Agreement (1966)
The period analyzed in this subtopic is initiated by the Brazilian government’s unilateral decision, under João Goulart (1961–1964), to construct a hydroelectric dam in the Sete Quedas region of the Paraná river. The act resulted in a sequence of events shaping the diplomatic dynamics between Brazil and Paraguay, and later involving Argentina.2 The Brazilian decision was made unilaterally, with no consideration to the shared ownership of the Paraná river or the region where the hydroelectric plant was planned to be built.3 Paraguayans had an understanding that the Sete Quedas were located within their territory (Yegros and Brezzo 2013). This divergence in territorial interpretations was rooted in conflicting readings of the 1872 Boundary Treaty, which delineated the border between the two countries (Cotrim 1999). Notwithstanding these facts and the political-ideological differences that characterized the administrations of João Goulart and Alfredo Stroessner (1954–1989), the two leaders established a pathway for cooperation regarding the construction of a binational hydroelectric plant.4
The coup d’état of April 1964 marked a critical juncture in Brazil’s political trajectory, reshaping its domestic governance and recalibrating its foreign policy approach. This shift had direct implications for Brazil’s negotiations over the Sete Quedas hydroelectric project (Cotrim 1999). Despite expectations that the ideological alignment between the new Brazilian regime and Alfredo Stroessner’s government would facilitate cooperation, unresolved territorial disputes escalated tensions. The border question, rather than being mitigated through diplomatic alignment, became a source of heightened friction, with more intensive competing territorial claims over the Sete Quedas region. The situation reached a critical point when Brazil, seeking to assert its position, deployed military forces to establish a strategic presence in the disputed area (Blanc 2018).
The intensification of public debate within Paraguay over the Sete Quedas dispute was driven, in part, by opponents of Stroessner’s dictatorship, who leveraged the issue to challenge the regime’s position. In response, the Paraguayan government sought to navigate a precarious balance – asserting a firm stance against Brazil to maintain domestic legitimacy while avoiding actions that could irreparably damage bilateral relations.5 To what extent the anti-Brazil rhetoric was a calculated strategy by the Paraguayan government remains unclear, given the strict control over the media in Paraguay at the time. Nevertheless, state-controlled Paraguayan media framed Brazil’s military presence in the border region as an act of aggression, amplifying diplomatic statements that condemned Brazil’s actions while downplaying Brazilian responses.6 By portraying Brazil as an expansionist power, Paraguay aimed to increase international pressure and, ultimately, multilateralize the negotiations, seeking to shift the diplomatic balance in its favor.7
The Paraguayan strategy to multilateralize the Sete Quedas dispute unfolded through discreet diplomatic maneuvers, leaving limited documentary evidence of its concrete actions (Debernardi 1996, 62–63). However, one notable episode recounted by Debernardi (1996) highlights a mission personally authorized by Stroessner, in which a high-ranking minister was tasked with conveying Paraguay’s concerns to US officials during an official visit to the US. The objective was to frame Brazil’s military presence in the disputed border region as an occupation of Paraguayan territory (Debernardi 1996, 62). Further reinforcing this strategy, Stroessner is reported to have directly sought US intervention during a meeting with Secretary of State Dean Rusk in Asunción in November 1965. These actions illustrate Paraguay’s attempt to internationalize the dispute by engaging external actors, particularly the US, in an effort to counterbalance Brazil’s dominant position in bilateral negotiations.8
During the 1966 meeting of the Organization of American States (OAS), the Paraguayan press attempted to draw a connection between the issues discussed at the forum and the border dispute between Brazil and Paraguay. The Paraguayans sought to include a provision in the OAS Charter stipulating that disputes between countries in the American hemisphere should be submitted for consideration by the organization.9 The idea was based on the premise that Paraguay would be favored in a potential mediation on the border issue if it were, by any chance, led by third parties. Prior to this, Brazil, through a statement from the MRE, had even suggested the possibility of submitting the matter to international arbitration. This position was harshly criticized by the Brazilian press.10 The Paraguayan strategy of seeking to multilateralize the debate over the Sete Quedas was strategic and caused concern in Brazil, which sought to keep the negotiations at the bilateral level.
A turning point in building consensus came with the appointment of Juracy Magalhães as Brazil’s Minister of Foreign Affairs. The negotiations that took place during João Goulart’s presidency had reached an understanding between Brazil and Paraguay regarding the possibility of jointly utilizing the Sete Quedas region. With Juracy Magalhães leading foreign relations, Brazil’s rhetoric shifted back to a conciliatory tone, considering the possibility of Paraguay’s participation in the use of energy resources and any other projects to be developed in the Sete Quedas.11
In the early 1960s, before the military coup in Brazil, the foreign ministries of the Southern Cone countries shared a common understanding that regional integration was essential for development. Within this framework, energy production was envisioned as a key instrument to advance diplomatic efforts toward greater regional cooperation (Cabral 2004, 100-103). This consensus materialized in initiatives such as the creation of the Regional Energy Integration Commission (CIER) in 1964. However, following the coup, Brazil’s stance on cooperation with Paraguay over the Sete Quedas diverged from this earlier consensus, initially adopting a more unilateral approach. As foreign minister, Juracy Magalhães revived the cooperative discourse surrounding the Paraná river, positioning hydroelectric development as a means to strengthen Brazil-Paraguay relations.12 From that moment, Brazil began framing the Sete Quedas project as not only a bilateral endeavor but also a contribution to broader regional integration. The first concrete step in this redefined approach was the agreement between Brazil and Paraguay on the joint utilization of the Sete Quedas, signaling a renewed commitment to collaborative energy development.
Figure 1 illustrates the operation of the causal mechanisms that explain the outcome achieved during this phase of negotiations – namely, the signing of the Cataratas Agreement. It is worth noting that the national interest mechanism shifts over time, evolving from a purely self-interested pursuit of hydroelectric energy to leveraging the project as a political asset in constructing a discourse of regional integration. This strategy remains in effect in the analysis of the two subsequent subtopics.
The signing of the Cataratas Agreement on June 22, 1966 represented a key step in reconciling the interests of Brazil and Paraguay in the Sete Quedas dispute. In the meetings leading up to the agreement, Brazilian Foreign Minister Juracy Magalhães articulated Brazil’s commitment to a resolution that would “without infringing upon the dignity, sovereignty, and interests of both countries, provide the constructive foundations for joint efforts aimed at economic development, social progress, and the realization of the Pan-American ideal of peace”.13 This rhetoric aligned with Brazil’s broader strategy of framing hydroelectric cooperation as a vehicle for regional integration. The agreement established the principle of equity in the use of the Paraná river’s resources in the border region, a diplomatic compromise aimed at preserving bilateral negotiations while addressing Paraguay’s concerns. However, the issue of ownership remained unresolved, as neither country recognized the other’s territorial claims over Sete Quedas, leaving the core sovereignty dispute open.
The Itaipu Treaty (1973)
The signing of the Cataratas Agreement left the question of ownership over the Sete Quedas unresolved, which remained a persistent challenge for Brazilian diplomacy. As tensions escalated during subsequent negotiations, Paraguayan authorities formally requested the replacement of Brazil’s ambassador in Asunción, prompting the appointment of Mário Gibson Barboza. His arrival was met with open hostility – demonstrators burned a Brazilian flag on the main street of the Paraguayan capital, while the Brazilian embassy was defaced with graffiti reading “Out with the Brazilian invader” (Cabral 2004, 69). This atmosphere underscored the urgency of addressing the territorial deadlock before meaningful progress could be made in negotiations over the construction of a hydroelectric plant at Sete Quedas. The events highlighted how unresolved sovereignty disputes continued to inflame nationalist sentiments, further complicating diplomatic efforts.
On February 12, 1967, following the signing of the Cataratas Agreement, Brazil and Paraguay established the Joint Technical Commission to conduct feasibility studies on the proposed site for the binational hydroelectric plant. However, progress on the project remained entangled in ongoing political tensions related to the unresolved border dispute. In 1969, the astronomical landmark demarcating the Sete Quedas region was knocked down three times, further exacerbating diplomatic frictions. The MRE suspected Paraguayan involvement in these incidents, yet Brazil took on the responsibility of reinstalling the marker each time. These episodes reflected the persistent underlying disputes over sovereignty, demonstrating how territorial disagreements continued to shape the broader negotiations on hydroelectric cooperation.14
The contradictory stance of Paraguay’s diplomacy – alternating between signaling cooperation with Brazil and creating obstacles to bilateral progress – can be understood as a strategic move by Stroessner’s regime to maintain domestic legitimacy.15 Brazilian diplomatic communications frequently highlighted this dynamic, recognizing that Stroessner faced the challenge of managing relations with Brazil while addressing nationalist sentiments at home.16 Paraguay’s public discourse often framed Brazil as an imperialist power attempting to seize its territory, forcing Stroessner to carefully navigate between sustaining diplomatic ties and appeasing domestic opposition. This balancing act contributed to the continued volatility of negotiations, as Paraguay oscillated between engagement and resistance in its dealings with Brazil.
The decisive moment in de-escalating the border dispute came with the initiation of technical studies for the hydroelectric plant, still referred to at the time as Sete Quedas. The studies carried a significant geopolitical implication: since the proposed dam’s construction would submerge the entire contested border area, an outcome that ultimately came to be, the territorial dispute would effectively be resolved. Brazilian diplomacy viewed the flooding as a definitive solution to the sovereignty question (Cabral 2004, 73).17 At this stage, Argentina emerged as a key actor in the political deliberations surrounding the project, reflecting its broader strategic interests in the region. It was also during this period that the hydroelectric plant was renamed Itaipu, as proposed by Paraguayans (Cabral 2004, 74-75).18
Argentina became actively involved in the negotiations as a key stakeholder in the use of the Paraná river’s waters. Seeking to assert its influence over the project, it introduced the principle of prior consultation during the First Meeting of the Foreign Ministers of the La Plata Basin Countries in February 1967. This principle required Brazil and Paraguay to disclose details of the hydroelectric project, allowing Argentina to assess whether the proposed parameters would impact its interests regarding the river’s flow and resource management.19 From the perspective of Brazilian diplomacy, this initiative was perceived as a strategic maneuver aimed at obstructing or delaying the construction of the hydroelectric plant. The Argentine dimension of the negotiations, with its broader geopolitical and diplomatic implications, will be explored in greater depth in the following subtopic.
Argentine concerns over the Itaipu project grew more pronounced in the years following the introduction of prior consultation. Despite this, Brazil remained committed to conducting bilateral negotiations with Paraguay, resisting external interference. This approach culminated in the signing of the Itaipu Treaty on April 26, 1973, which formally established the framework for the construction and operation of the hydroelectric plant. The treaty addressed a wide range of diplomatic, economic, social, and legal issues, ensuring a structured approach to binational cooperation. More importantly, its signing reinforced Brazil’s strategic objectives, particularly in managing the border dispute on its own terms. By securing Paraguay’s agreement without direct Argentine involvement, Brazil effectively consolidated its diplomatic approach, maintaining control over the project’s execution and regional implications.
From an economic standpoint, the construction of Itaipu involved an expenditure that exceeded several billion dollars and contributed to meeting part of Brazil’s demand for electricity (Pereira 1974). Brazil shouldered nearly the entire cost of the project, securing its investment through a key provision in the Treaty (see Anex C of the document) that required Paraguay to sell any surplus electricity exclusively to Brazil at a fixed price for a period of fifty years (Caubet 1989).20 Socially, the hydroelectric plant involved the mobilization and displacement of a large human contingent, both due to the relocations caused by the flooding resulting from the dam and the need for labor to carry out the construction work (Schmitt 2008). Legally, the Itaipu Treaty introduced an innovative governance model for managing transboundary resources. The creation of a binational company to oversee both construction and operations, coupled with the establishment of a framework for the shared use of an international river, marked a pioneering development in international law (Betiol 1983).
Figure 2 demonstrates how the causal mechanisms that led to the signing of the Cataratas Agreement remained in effect throughout the negotiations of the Itaipu Treaty. Since this process was already underway, both Brazil and Paraguay continued to act within the same strategic framework that had been set in motion.
Brazilian diplomacy strategically framed the Itaipu Treaty as a demonstration of its commitment to regional cooperation, using the agreement with Paraguay as implicit evidence of its willingness to engage constructively with its neighbors. This narrative was particularly relevant in countering Argentina’s diplomatic efforts, which sought to depict Brazil as an intransigent regional actor. Additionally, Brazil had to contend with the lingering negative repercussions of its past tensions with Paraguay, which had strained bilateral relations in preceding years. In this context, the Itaipu Treaty became a diplomatic tool, allowing Brazil to present itself as a proponent of regional integration and stability. Reflecting on the outcome of the negotiations, the MRE stated:
Brazil is a country with a peaceful vocation, averse to isolation and opposed to dreams of hegemony. We are, by temperament and vocation, open to solidarity and ecumenism. However, we naturally turn, first and foremost, to the countries that are closest to us, for one reason or another, including, and especially, to those that are our neighbors.21
Brazil’s approach to the utilization of the Paraná river sought to align its national interests with those of its riparian neighbors, Argentina and Paraguay. This required a careful balance between realism, asserting its strategic priorities, and constructivism, shaping a narrative of regional cooperation. While, in practical terms, the construction of Itaipu was set to proceed regardless of Argentine approval, Brazilian diplomacy nonetheless engaged in significant efforts to manage relations with its more influential neighbor. This diplomatic balancing act reflected Brazil’s recognition of Argentina’s geopolitical weight and the potential consequences of outright disregard for its concerns. The following subtopic delves deeper into this dynamic.
The Tripartite Itaipu-Corpus Agreement (1979)
Throughout the negotiations with Paraguay, Brazil deliberately pursued a bilateral approach, addressing both the utilization of the Paraná river’s waters and the construction of the hydroelectric plant at Sete Quedas without external interference. By avoiding the multilateralization of the discussions, Brazil maximized its ability to steer the negotiations in a direction that best served its strategic interests. At the same time, despite its efforts to keep Argentina from directly influencing the Itaipu project, Brazil did not entirely exclude its neighbor from the conversation. Rather, Brazilian diplomacy engaged with Argentina to seek a broader understanding, aiming to mitigate potential conflicts and foster a degree of consensus on the matter.
Argentina first raised its objections to the construction of Itaipu in 1967 through the thesis of prior consultation. This thesis was based on the idea that upstream countries in international rivers should consult downstream countries before undertaking projects that involve the utilization of shared water resources. Brazil, on the other hand, defended the thesis of “significant harm”. According to the Brazilian interpretation, upstream countries should present technical studies demonstrating the feasibility of the project without causing significant harm to the downstream communities. MRE interpreted the Argentine argument as an attempt to use the prior consultation requirement to veto the construction of the planned hydroelectric plant.
The dispute between Brazil and Argentina over Itaipu’s construction gained international prominence during the United Nations Conference on the Human Environment, known as the Stockholm Conference (1972). Recognizing the broader implications of the debate on prior consultation, Brazilian diplomacy closely monitored other transboundary water disputes, seeking parallels that could reinforce its position. One such case was the conflict between Bangladesh and India over the construction of the Farakka dam on the Ganges river. Initially, India’s position aligned closely with Brazil’s argument that upstream nations should have the autonomy to develop water projects as long as they did not cause significant harm downstream. However, as Bangladesh and India moved toward a mutual understanding on the issue, Brazilian diplomats grew concerned that Brazil would be isolated in defending this principle in multilateral forums.22 This shifting dynamic heightened Brazil’s urgency to navigate the Itaipu negotiations carefully, ensuring that international legal precedents did not undermine its strategic objectives.
At the Stockholm Conference, the debate over management of international rivers gained significant traction, with Argentina successfully advancing its thesis of prior consultation. As an outcome of the conference, the Stockholm Declaration was drafted, outlining key environmental principles.23 Point 20 of the declaration was initially set to enshrine the idea of prior consultation as an international norm. However, due to the requirement for decisions to be reached by consensus, the final determination on this provision was postponed. Instead, it was decided that Point 20 would be formally debated and put to a vote at the 27th session of the United Nations General Assembly (UNGA) (Cabral, 2004, 86-87). This postponement provided Brazil with an opportunity to intensify its diplomatic efforts to counterbalance Argentina’s influence and defend its interpretation of international water governance.
Brazil sought to engage Argentina in negotiations through its ambassador in Buenos Aires. However, bolstered by the strong support they had garnered at the Stockholm Conference, the Argentinians were confident in securing a favorable outcome in the upcoming UNGA vote. They viewed discussions with Brazil as a diplomatic formality, stating that they were engaging in talks “only out of courtesy” (Cabral, 2004, 87). In response to Argentina’s dismissive stance, the MRE instructed its diplomats to suspend further negotiations, opting instead to address the matter directly during the UNGA session. At that point, Brazilian Foreign Minister Mário Gibson Barboza personally approached the Argentinians in an attempt to reach a possible agreement before the decisive vote took place.
In the face of Argentina’s strong resistance to reaching an agreement with Brazil, the Brazilian Foreign Minister even stated that Itaipu would be built and that the only way the Argentinians could attempt to stop it would be through war (Cabral, 2004, 87-89). This remark underscored the determination of the Brazilian government to move forward with the project, despite diplomatic tensions. Ultimately, Argentina relented and agreed to a formulation that validated Brazil’s position. As a result, Argentina, Brazil, and Paraguay collaborated on a joint proposal, which was unanimously approved at the UNGA. This document became known as the New York Agreement, marking a significant diplomatic resolution in the negotiations over the utilization of the Paraná river.
Following the confrontation in New York, Argentina shifted its strategy in an attempt to obstruct the construction of Itaipu. It announced plans to build a binational hydroelectric dam with Paraguay on the lower section of the Paraná river, named Corpus. This move was framed under the rationale of optimizing the use of international rivers through integrated planning. However, the proposed Corpus project posed two major concerns for Brazil. First, the dam’s construction would result in the flooding of a significant portion of Brazilian territory. Second, the technical specifications of Corpus, as envisioned by Argentina, would drastically reduce the energy generation potential of Itaipu, directly threatening Brazil’s strategic interests in the region.
Given these circumstances, Brazil had no interest in opening negotiations on the matter. Engaging in discussions about Argentina’s proposal for the full utilization of the Paraná river would significantly delay the construction of Itaipu by several years – an outcome that Brazil sought to avoid. At the time, the country faced an urgent demand for electricity to sustain its ongoing development in the Brazilian South-Central region.24 From the perspective of Brazilian diplomacy, Argentina’s push for the Corpus project was not a genuine attempt at regional energy integration but rather a strategic maneuver aimed at obstructing the progress of Itaipu.25
Brazil’s negotiation strategy with Argentina mirrored its approach with Paraguay: maintaining diplomatic equilibrium while preventing the international community from perceiving Brazil negatively. A key concern was managing Argentina’s portrayal of Brazil, as the Argentine media, much like the Paraguayan press, amplified a narrative of Brazilian dominance. At the height of these tensions, rumors circulated in Argentina suggesting that Brazil might be planning a massive dam on the Paraná river, which could potentially flood Buenos Aires. Within the MRE, these exaggerated narratives, fueled by political figures and the media, became known as “catastrophic hypotheses”.26
Following the signing of the Itaipu Treaty between Brazil and Paraguay, Argentina took a decisive step by denouncing the New York Agreement in July 1973, once again advocating for the prior consultation thesis (Queiroz 2012, 212). This time, however, Argentina strategically linked its argument to its own plans for the construction of the Corpus hydropower plant. In this new phase of diplomatic maneuvering, Argentina sought to reintroduce the prior consultation principle at the UNGA. With strong backing from the African bloc, Argentine diplomacy successfully secured the approval of Resolution No. 3.129, which officially recognized prior consultation as a guiding principle for the management of shared natural resources (Queiroz 2012, 212).
The First United Nations Conference on Water, held in Mar del Plata in March 1977, provided a crucial forum for discussing water-related issues, including the management and sharing of international rivers. Amid growing tensions surrounding the Itaipu and Corpus projects, the conference facilitated a diplomatic rapprochement between Argentina and Brazil, as both countries sought to find common ground on the governance of transboundary water resources.27 For Brazilian diplomacy, the primary concern revolved around the final document that would emerge from the conference. This document was intended to serve as a framework of guidelines for the sustainable development and management of water resources. Given the previous confrontations over the prior consultation thesis, Brazil aimed to ensure that the final text would not introduce new constraints on its ability to develop hydroelectric projects without external interference.
At the conference, the Argentinians took the initiative to approach the Brazilian delegation, offering assurances that they would not introduce obstacles to the discussions, citing their country’s interest in strengthening its understanding with Brazil.28 This diplomatic gesture suggested a shift in Argentina’s approach, signaling a willingness to pursue a more conciliatory stance regarding the management of the Paraná river. Argentina’s decision to avoid pushing for principles aligned with the prior consultation thesis, particularly at an event held on its own territory, serves as a historical indication of its intent to seek a negotiated solution with Brazil. At that moment, Argentine diplomacy appeared to prioritize reaching an agreement over continuing the confrontational approach that had characterized previous years.
The final stage of negotiations for the signing of the Tripartite Agreement unfolded under growing pressure from the press in both countries, which urged a resolution. In Brazil, media attention was drawn to an opinion piece published in the Argentine newspaper Clarín, which claimed that Argentina had extended a hand to Brazil for negotiations but had not received a reciprocal gesture.29 An editorial in Jornal do Brasil asserted that “Itaipu will not be: Itaipu is.” The newspaper went on to emphasize the urgent need for Argentina and Brazil to end the deadlock in order to “create a climate of permanent understanding between countries and economies that have only one path – to come closer together.30
In the final moments leading up to the signing of the Tripartite Itaipu-Corpus Agreement, Brazil strategically framed its discourse around the theme of regional integration. During the First Plenary Session of the Forum of the Americas in June 1979, the Brazilian Foreign Minister stated, in reference to Itaipu: “There are situations in which, in order to take advantage of common potentials, our countries come together in efforts, based on equality and mutual respect, to carry out projects with a strong and positive impact on regional society”.31
During a conference in July 1979 at the Superior War School in Rio de Janeiro, the same Foreign Minister highlighted Itaipu as a factor that would foster closer ties between Brazil and Argentina. In his speech, Itaipu was not framed as a point of divergence but rather as a bridge toward the realization of the broader aspirations shared by both countries. The use of Itaipu as an example of political action was linked not only to the magnitude of the project itself but also to its regional and international repercussions.32
The Tripartite Itaipu-Corpus Agreement was finally signed on October 19, 1979, marking the conclusion of a prolonged negotiation process between Argentina, Brazil, and Paraguay over the use of the Paraná river’s waters for electricity generation. The agreement established the framework for cooperation among the three countries, reflecting the delicate balance of interests that had shaped the discussions over the years. At the time, Argentina expected construction on the Corpus plant to commence within two to three years of the agreement’s signing. Paraguay, however, projected that construction might only begin around 1990. As history has shown, the Corpus plant was never built, and the likelihood of its construction remains minimal.
Figure 3 details the mechanisms in action during the negotiations of the Tripartite Itaipu-Corpus Agreement. National interest and the need for cooperation remained constant throughout the process, from Argentina’s initial objections onward. Pressure from public opinion became a greater concern for Brazil due to the stance of the Argentine press and, more significantly, the mobilization of Argentine diplomacy in multilateral forums in defense of the prior consultation principle.
– Causal mechanisms in action during the negotiations of the Itaipu-Corpus Tripartite Agreement
The resolution of the dispute between Argentina and Brazil over the Paraná river marked the beginning of a new phase in bilateral cooperation across various sectors. By the time the Tripartite Agreement was signed, it was already being viewed as a turning point in the relationship between the two countries.33 The Brazilian statement during the signing ceremony underscored the broader significance of the agreement, emphasizing its role in strengthening regional stability and fostering deeper integration within South America:
Brazil sees the success of its neighbors as its own success. In a world where large regional integrations are being shaped and subordinating international forces are emerging, it seems necessary for our subcontinent to overcome its difficulties and conjunctural limitations, as well as its internal disputes.34
At the time, the signing of the Tripartite Agreement was seen as a milestone that not only expanded bilateral cooperation but also carried “significance for the entire region and repercussions even beyond it”.35 Brazil seized the opportunity created by its rapprochement with Argentina and Paraguay to reinforce its vision of regional leadership. At the same time, Brazilian diplomacy sought to counteract the perception, prevalent in some circles, that the country represented a “subimperialist threat” within the regional community.36 The agreement thus became a key instrument in Brazil’s strategy to assert itself as a cooperative and integrative power in South America.
Itaipu’s construction and its impacts for Brazilian diplomacy and foreign policy
This topic discusses the impacts of Itaipu’s construction on Brazil’s foreign policy. The aim is to demonstrate how this infrastructure project influenced regional political dynamics and how Brazil leveraged it for broader objectives within its foreign policy agenda. The construction of Itaipu generated significant political tensions, shaping a new geopolitical configuration in the Southern Cone. It fostered cooperative processes regarding the use of transboundary waters and infrastructure development, transforming previous disputes into negotiation frameworks. Over time, this cooperation extended into other areas, reinforcing Brazil’s strategy of using the Itaipu project as a diplomatic tool to achieve regional foreign policy goals.
The text is organized into three subtopics, each representing one of the periods analyzed in the previous topic. Figure 4 names and summarizes each period within the strategic actions of Brazilian foreign policy, which aimed to balance national interests and foster a regional agenda of cooperation. The characteristics and positioning of each period are then detailed within the discursive and practical context of Brazil’s foreign policy. The analysis reveals continuity in Brazil’s strategy of transforming narratives surrounding the construction of Itaipu into broader-reaching foreign policy outcomes.
Equalization of interests
The decision to construct a hydroelectric plant in the Sete Quedas region evolved into a political issue as Brazil proceeded without fully acknowledging the shared nature of the Paraná river. Border disputes, which Paraguay viewed as unresolved, further complicated the situation. The period identified as the equalization of interests arose from the need to reconcile Brazilian and Paraguayan positions on the river’s utilization. The signing of the Cataratas Agreement (1966) secured an equitable division of water resources. However, this cooperative outcome was shaped by Paraguay’s persistent challenges and Brazil’s sensitivity to its regional and international image.
Power asymmetries in shared water resource management often result in scenarios where the dominant state enforces its interests over weaker counterparts (Zeitoun and Warner 2006). In Brazil’s case, the pursuit of cooperation with Paraguay emerged as a strategic response to the risk of international scrutiny, pushing for a recalibration of both discourse and diplomatic practice. Over time, the rhetoric of cooperation became increasingly prominent, particularly when it served Brazil’s interests or facilitated its advancement.
The disputes with Argentina further reinforce this interpretation, illustrating how Brazil strategically employed cooperative discourse while navigating regional power dynamics. Brazil’s cooperative discourse evolved into a broader regional strategy, serving its own strategic interests. This shift was driven by two key factors: (i) the Brazilian military government’s political project, which aimed to establish Brazil as a regional power; and (ii) the necessity, within this project, to construct an image of Brazil as a proactive leader in regional cooperation, demonstrating attentiveness to the needs of its neighbors. This effort was especially relevant in Paraguay, where perceptions of Brazilian imperialism in bilateral relations were deeply rooted and, in many ways, persist to date.
The signing of the Cataratas Agreement served as a political instrument through which Brazil formally acknowledged Paraguay as a co-owner of the Paraná river’s waters, guaranteeing an equitable distribution of these resources and their associated benefits. Beyond reinforcing Paraguay’s position within Brazil’s sphere of influence, the agreement also enhanced Brazil’s international standing by projecting a positive image of its regional foreign policy approach.
Concrete action
The concrete action culminated in the signing of the Itaipu Treaty (1973), which established the legal foundation for the construction of the Itaipu Dam and reaffirmed Brazil’s formal commitment to Paraguay’s co-ownership of the project. The use of the term “concrete action” underscores this moment as the institutional materialization of Brazil’s strategic objectives, transforming prior negotiations and discursive efforts into binding diplomatic and legal commitments. However, the period between the Cataratas Agreement and the Itaipu Treaty was marked by significant tensions, including mass demonstrations in Paraguay, the burning of the Brazilian flag, and denouncement of Brazil’s newly appointed ambassador in Asunción. These protests reflected enduring grievances over unresolved border issues and the presence of Brazilian military forces in the frontier region, highlighting the strains on the diplomatic process even as it advanced toward formalization.
In political and diplomatic terms, the period between 1966 and 1973 solidified Brazil’s position on the utilization of the Paraná river’s waters in its negotiations with Paraguay. While the principle of equitable use of the river along the shared border was upheld, Brazil imposed conditions that significantly shaped the agreement, the most consequential being the exclusivity clause on surplus energy sales. From the outset, various Paraguayan sectors voiced strong criticism of the financial terms established in the Itaipu Treaty, contending that these conditions compromised Paraguay’s sovereignty over its share in the project (Folch 2016).
This persistent dissatisfaction shaped a cooperative-conflictual dynamic in the bilateral relationship over the Itaipu project when analyzed over time. While Paraguay viewed the treaty’s terms as reinforcing structural asymmetries between the two countries, for Brazil, the agreement marked the fulfillment of its strategic objectives. The treaty was the result of a diplomatic approach that sought to safeguard Brazilian national interests while simultaneously projecting an image of proactive regional cooperation to the international community.
The period between 1966 and 1973, culminating in the Itaipu Treaty, was also crucial in shaping Brazil’s discourse on cooperation and regional integration. Despite Paraguay’s objections to the treaty’s financial terms, its signing was a strategic victory for Brazil, reinforcing its status as a regional power and showcasing its capacity to formulate policies that combined cooperative rhetoric with the protection of national interests. This balancing act, promoting regional cooperation while ensuring national priorities, became a lasting feature of Brazilian foreign policy, shaped by the lessons learned during this historical process.
Strategic harmonization
The signing of the Tripartite Itaipu-Corpus Agreement (1979) cemented Brazil’s strategy of political harmonization with Argentina. This strategy was not conceived from the outset but developed progressively as challenges and external pressures emerged. In the early 1960s, the prospect of an agreement with Argentina regarding the Paraná river’s waters was not even contemplated. However, shifting circumstances demanded new practical strategies and discursive adjustments by Brazil, leading to an expansion from a bilateral to a regional framework. This process highlights how national interests are not static but evolve throughout negotiations in response to contextual contingencies.
Brazil’s behavior throughout the negotiations can be characterized as a “cooperative hegemony” (Pedersen 2002), demonstrating its ability to share and aggregate power at a time when the regional agenda in South America was being formed. Moreover, Brazil’s action was productive for its international image and consistent with its foreign policy discourse. The signing of the Tripartite Itaipu-Corpus Agreement marked a new phase in regional relations by bringing together the two most relevant countries in the Southern Cone. At the time of signing of the Tripartite Agreement, the Brazilian discourse was symptomatic of the idea of promoting a political effort in favor of cooperation and regional integration: “Brazil sees the success of its neighbors as its own success”,37 proclaimed the MRE.
The path to reaching an agreement with Argentina was more prolonged, primarily because Brazil prioritized the construction of the hydroelectric plant with Paraguay. Brazil sought to avoid involving a third party in its negotiations with Paraguay, as this could have reduced its relative gains. A bilateral negotiation with a “weaker” neighbor allowed Brazil to secure more favorable terms. Cooperation with Argentina only became viable within the framework of a broader regional strategy. Without this strategic approach, it is unlikely that Brazil would have agreed to the terms of the Tripartite Itaipu-Corpus Agreement, given that there was no direct need for Argentine cooperation in the construction of Itaipu.
In both the Cataratas Agreement and the Itaipu Treaty, Brazil’s discursive strategy was explicitly directed toward a concrete objective – the construction of Itaipu. However, in the case of the Tripartite Itaipu-Corpus Agreement, the narrative was structured to establish a broader, politically oriented cooperative foundation. Unlike the previous agreements, this discourse did not immediately translate into specific projects or defined commitments. Nevertheless, the political gesture had significant long-term effects, fostering a rapprochement between Brazil and Argentina and laying the groundwork for a cooperation process that would intensify in the years that followed.
One significant outcome of this rapprochement was the initiation of Brazil-Argentina cooperation on nuclear materials. This process, which began around 1986, culminated in the establishment of the Brazilian-Argentine Agency for Accounting and Control of Nuclear Materials (ABACC) in 1991 (Patti 2021, 103-108). ABACC represented a milestone in bilateral relations, fostering mutual trust and transparency in the use of nuclear materials. Additionally, the signing of the Tripartite Agreement contributed to the groundwork for the creation of the Southern Common Market (MERCOSUR) in 1991, reinforcing economic and political cooperation in the region and further institutionalizing the integration process between the two countries.
Conclusion
The construction of Itaipu marked a turning point in Brazilian foreign policy, illustrating the intersection of infrastructure and diplomacy in shaping regional relations. The examination of the three historical periods – equalization of interests, concrete action, and strategic harmonization – reveals how Brazil leveraged Itaipu as a diplomatic instrument to advance both national and regional foreign policy objectives. Throughout this process, Brazil’s actions were carefully calibrated to secure the completion of the dam while mitigating perceptions of an inflexible or domineering stance toward its neighbors.
Throughout the period of equalization of interests, Brazil demonstrated the ability to adapt its strategies in response to diplomatic and strategic pressures, balancing Paraguayan concerns with its imperative to develop a large-scale hydroelectric project. The second period, marked by the signing of the Itaipu Treaty, underscored Brazil’s diplomatic ability to navigate bilateral negotiations that ensured the project’s realization while maintaining control over its benefits. Finally, the strategic harmonization with Argentina, institutionalized through the Tripartite Itaipu-Corpus Agreement, reinforced Brazil’s position as a regional power, paving the way for deeper political and economic integration in the Southern Cone.
The impacts of Itaipu extended beyond bilateral relations, setting important precedents for mutual trust-building in sensitive areas like nuclear cooperation and shaping regional integration processes such as the creation of MERCOSUR. Furthermore, the Itaipu case illustrated how Brazil adapted its discourse on cooperation to shifting contextual conditions, using it both as a diplomatic instrument and as a mechanism for power projection. However, the analysis also highlighted the persistent tensions stemming from the asymmetry of power between Brazil and Paraguay, particularly regarding criticisms of the Itaipu Treaty’s financial terms and lingering perceptions of Brazilian imperialism.
Ultimately, Itaipu serves as a paradigmatic example of how large infrastructure projects can shape foreign policy, acting as catalysts for regional cooperation and integration. For Brazil, Itaipu was more than just a hydroelectric plant – it symbolized the country’s commitment to constructing a regional identity based on cooperation and interdependence, despite persistent challenges and contradictions. Future research on Brazil’s role as a key actor in regional integration could use the Itaipu case as a framework for understanding how infrastructure projects can serve as instruments for strengthening political ties. This is particularly relevant in the context of Amazonian countries, where regional integration efforts continue to struggle with limited political institutionalization.
Acknowledgements
This research was supported by the National Council for Scientific and Technological Development – CNPq.
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Source: Elaborated by the author based on the model proposed by van Meedgdeenburg (2022).
Source: Elaborated by the author based on the model proposed by van Meedgdeenburg (2022).
Source: Elaborated by the author based on the model proposed by van Meedgdeenburg (2022).
Source: Elaborated by the author.