Far from depending on its many neighbours, Paraguay — nestled in the bosom of the continent — has actively drawn on all its geographical advantages
B R I E F I N G / BY J. Andrew Carter, Jr.
Situated on the banks of the Paraguay and Paraná Rivers between Bolivia, Brazil and Argentina, the Republic of Paraguay lies in what is known as the heart of South America, a notion that is deeply rooted in the culture and society of modern-day Paraguay. Historically, Paraguay was formed due to its positioning as the principal crossroads between other South American countries. However, Paraguay has emerged as a leading entity in the region, with its ability to resist foreign influence and to maintain its local language and culture, Guarani, which is preserved to this day. This aspect alone represents the durability and persistency that is deeply embedded in the country, and which is further evident through its modern political and economic standing at the crossroads, or heartland, of South America.
While the South American continent is considered one of the fastest growing in the world, the domestic Paraguayan economy is a symbol and reflection of regional success
Over the past 20 years, South American nations have undergone major economic growth and prosperity due to their incorporation of liberal economic policies and advances in natural-resource extraction, resulting in major economic success in regional and international markets. The central geographical location of Paraguay combined with the rapid developments in the continent have benefitted the nation through technological and logistical modernisation in the middle of economic prosperity. The country’s domestic economic success in the centre and interior of South America signifies its capacity to be a dynamic logistics platform and access point for foreign investment in the wider continent. While the South American continent is considered one of the fastest growing in the world, the domestic Paraguayan economy is a symbol and reflection of regional success.
Recognised as a major logistics hub for water transport, including cargos of grains, meat and mining resources, Paraguay has utilised its centralised location and major river ways to attract notable levels of foreign investment. Paraguay’s lack of direct access to ocean transportation routes has not prevented its emergence as a leader in logistical services, due to its advantageous location in South America, which is reflected and apparent in its consistent GDP growth rates of 4.5% over the past decade. Further complemented by low energy costs, abundant natural resources and a competitive tax regime, Paraguay represents an appealing investment environment, which continues to grow. Over 60% of Paraguayan foreign investments are concentrated in Asunción, where applications to open new businesses have tripled over the past few years, establishing Paraguay as a major focus for international investors in South America.
The increased exploitation of Paraguay as a principal trade partner in the international forum and as a logistics hub within South America has led to substantial economic agreements and trade expansion, which in turn has resulted in the creation of an emerging favourable investment climate for regional and international investors
The locational advantages unique to Paraguay also offer benefits outside the domestic economy, as it is fully integrated in the industrial supply chains of Brazil and Argentina. Paraguay is a world-class food product exporter and is renowned throughout South America as a major competitive force in the products and services exports sector, which includes logistic and transportation services. With access to new markets permitted through regional and international economic alliances, including Mercosur, the Paraguayan economy has achieved the export of over 14,000 different products to foreign markets, including the European Union. Mercosur represents the fourth-largest trading bloc in the world, incorporating South American economies and further increasing trade and sustainable growth in the continent. The increased exploitation of Paraguay as a principal trade partner in the international forum and as a logistics hub within South America has led to substantial economic agreements and trade expansion, which in turn has resulted in the creation of an emerging favourable investment climate for regional and international investors.
