Agribusiness and Economic Outlook in Paraguay

The Republic of Paraguay is a South American nation dominated by rivers, plains, hills, and a dry forest. The country has a total population of almost 7 million citizens, some 60% of which live in an urban setting, notably the capital city of Asuncion with 2.4 million inhabitants. Paraguay’s annual gross domestic product (GDP) is slightly above US$60 billion (PPP) and the country has experienced positive economic growth upwards of 3.0% in recent years. In terms of trade, during 2015, Paraguay imported US$10.1 billion worth of goods and exported US$8.3 billion, resulting in a trade deficit of US$1.8 billion. Furthermore, that same year, Paraguay’s main export, representing 24% or US$2 billion of the country’s total, was electrical energy. This was followed by soybeans, which represented 19% or US$1.6 billion of the country’s exports. On the other hand, Paraguay’s main import, representing 8.9% or US$905 million of all international purchases in 2015, was refined petroleum. Likewise, Paraguay’s main trade partners are Brazil, Argentina, Russia, China, the United States, and the European Union.

Agribusiness and Economic Outlook in Paraguay

The controversial President of Paraguay, Horacio Cartes, is supposed to end his term in April 2018. Since 2013, his administration has advanced a business-friendly culture in the country, attracting interest by international investors in a series of key sectors, including infrastructure, real estate, and the agribusiness complex. The economy continues to perform well, supported by a strong agricultural sector and other investments in the country. Furthermore, the infrastructure and agribusiness sectors are some of the priority areas for the country’s developments. Paraguay has become a major beef exporter in South America and the local soybean agricultural complex continues to expand. The growth of the agricultural sector is closely tied to the development of better and larger infrastructure, such as roads and railways, which makes for a very promising future.

Unfortunately, in Paraguay, about 700.000 people suffer from undernourishment. Furthermore, in recent years, the average per capita protein intake of animal origin amongst the Paraguayan population has been of 31 grams daily. Meanwhile, cereals, roots, and tubers supply 44% of the average food energy intake in the country. Similarly, land distribution and output in Paraguay have also evolved throughout the last half century. Back in 1961, permanent pastures and meadows in the country covered 9.6 million hectares, while arable land covered 700.000 hectares and permanent crops accounted for 111.000 hectares. More recently, by 2014, permanent pastures and meadows had increased to 17 million hectares, while arable land represented 4.8 million hectares and permanent crops covered 85.000 hectares. In 1961, the cereals market in Paraguay utilized 111.600 hectares of land and yielded almost 140.000 metric tons annually. Finally, in 2014, the country devoted 1.5 million hectares of land to cereals production and yielded approximately 5 million metric tons.

(Read more about Agricultural Markets and Meat Production in Paraguay)