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The Paraguay Country Private Sector Diagnostic provides a comprehensive analysis of Paraguay’s potential for private sector-led growth, drawing on data and interviews to identify concrete policy actions that can be taken in the near term to help create commercially viable investment opportunities for the private sector.
In five sectors — sustainable production of rice, sustainable production of pork, sustainable forestry, solar photovoltaic (PV) generation, and textiles and apparel — policy reforms could generate up to $3.3 billion in private investment and over 30,000 jobs by 2030.
In the rice sector, infrastructure gaps, lack of access to quality seeds, and limited adoption of sustainability standards hinder growth. Among other things, government can improve the attractiveness and sustainability of the sector for investment by improving farm access to transport infrastructure, adopting sustainability certification systems, and supporting the development of new rice seed varieties.
Private investment in the sustainable production of pork is discouraged by inadequate sanitary standards, limited infrastructure, and environmental challenges. Among the actions government can take to improve the investment climate are accelerating the implementation of a "compartments strategy" for biosecurity, strengthening regulatory capacity, and improving road infrastructure.
In forestry, investors are discouraged by land tenure issues, cumbersome environmental licensing processes, and high logistics cost. Modernizing the land information system, revising environmental impact assessment standards, and implementing the national biomass certification program would encourage investment and sustainability in the sector.
Constraints on investment in solar PV generation include underinvestment in the energy grid, financial sustainability of the public utility and regulatory uncertainties. To spur investment, government could ensure economic feasibility of long-term power purchase agreements, permit private investment in the energy grid, and specify conditions for private investors to access the grid.
Further private investment in textiles and apparel is discouraged by insufficient skills and training available, limited access to capital for expanding production, customs delays at the border and poor transportation infrastructure. Government can streamline trade and customs regulations and undertake measures to facilitate factoring for firms to access working capital.
