http://www.worldbank.

org/en/country/paraguay/overview

Paraguay Overview

CONTEXT

STRATEGY
RESULTS

Paraguay is a country with immeasurable natural wealth. The production of clean energy is
one of the most relevant activities of the country, such as the highly mechanized agriculture
and livestock production. Although the country is landlocked, its land is crossed in all its
extension by numerous watercourses that make up the hydrographic network of the River
Plate Basin, where the Guaran Aquifer is seated, which is considered one of the largest fresh
water reserves in the planet.
The Paraguayan economy is small and open, highly dependent on foreign trade, particularly
soybean and beef trade which represent 50% of exports. However, the high poverty and
inequality indexes continue to be important development challenges. Poverty afflicts one of
three Paraguayans, while extreme poverty, one of five.
In the last decade, the country made significant advances in macroeconomic aspects, with
solid results in fiscal and monetary aspects as well as important steps toward social reforms.
Among the most outstanding in the past few years, free access to primary health care and
basic education can be cited. An expansion of conditional money transfer programs that
impact the most vulnerable populations was also achieved.
In terms of recent developments, Paraguayan economy has experienced high volatility in
terms of its growth. After an economic expansion of 15 % in 2011, the severe draught which
took place during the first quarter of 2012 and the foot and mouth disease outbreak detected
towards the end of 2011 led to an estimated drop of 0.7% of GDP in year 2012.
For this year, the GDP, in a second review, presents a positive growth rate of 13%, 2.5
percentage points above the estimations of last december, when it was calculated at 10.5%,
according to the Central Bank of Paraguay.
Nevertheless, for year 2013 a growth of about 10.5 % is expected, according to the Central
Bank of Paraguay, which will be led by the dynamic agricultural sector as a result of the
favorable climatic conditions anticipated.

The international reserve position is maintained at an historical high level of approximately

US$ 5,5 billions, which corresponds to about six months of imports. The exchange rate has
been stable in the past few years, with some signs of appreciation towards the end of 2012.