Paraguay President Announces Resignation Amid Banking Crisis

Libya Al Jadida reports that Paraguayan President Mario Abdo Benitez has announced his resignation amid a banking crisis that has led to widespread protests. The crisis began when the central bank took control of Banco Oigno, a bank linked to the president, due to a severe lack of capital. This move froze the deposits of nearly three million people, including retirees, and sparked angry demonstrations across the country.

The protests saw thousands of people gather in front of the Congress building, chanting "return our money" and demanding that the government take action to resolve the crisis. The demonstrations turned violent, with police using tear gas and water cannons to disperse the crowds. Student Andres Maldonado, 21, who participated in the protests, said that his family's money had run out and they had no more funds.

The Paraguayan Congress voted unanimously to begin impeachment proceedings against President Benitez, citing allegations of misconduct and conflict of interest. In a video message, Benitez announced his resignation, stating that he wanted to apologize to the people if he had fallen short at any stage. He claimed that he had no intention of betraying the trust placed in him.

Benitez also stated that his priority was to reassure Paraguayan citizens who had placed their savings in the financial system. He confirmed that he would appear before the Senate and exercise his right to defend himself during the impeachment trial, which may take place on Friday. Interior Minister Enrique Riera also resigned on Thursday, and Carlos Benitez was appointed as his interim replacement.

The central bank took control of Banco Oigno due to a severe lack of capital, aiming to protect depositors and maintain financial stability. Nadia Gonzalez, a 26-year-old mother of three, said that Banco Oigno had agreed to grant her a loan to buy their first home, but the funds were not disbursed, and now they had nowhere to live. Long queues of people seeking to withdraw their money from Banco Oigno branches were seen in the capital city of Asuncion on Tuesday and Wednesday.

President Benitez previously owned shares in the group that controls Banco Oigno but sold them last year. He attempted to ease tensions by requesting the resignation of Central Bank Governor Carlos Carvalho, who complied, and setting a five-day deadline to return funds. However, neither measure was sufficient to calm the situation. The Congress called an extraordinary session to consider Benitez's resignation or proceed with impeachment proceedings.

Key points

• President Mario Abdo Benitez announces resignation amid banking crisis
• Nearly three million people affected by frozen deposits
• Congress to proceed with impeachment proceedings