MercoPress. South Atlantic News Agency

Paraguay requesting 300 million USD to finance 2009 budget

Mercosur weakest member, landlocked Paraguay will be appealing for funds from multilateral organizations to balance this year's budget, announced Finance minister Dionisio Borda.

"Revenue and issuing bonds won't be enough so we are requesting 300 million US dollars from the World Bank, Inter-American Development Bank (IDB) and the Andean Promotion Corporation", admitted Minister Borda following a meeting with President Fernando Lugo. Borda announced that in coming days he will be announcing details of a "tough budget" which are necessary to help finance the deficit and a future stimulus program, which he said will need "congressional consensus" and at least six months of discussions before it begins to be implemented. As supplier of commodities (soy beans, beef, hides) Paraguay enjoyed a boom until prices collapsed and windfall earnings vanished, and now needs fresh funds to keep the economy moving. The "contingency program" as it is officially known, will concentrate on three main areas according to Borda. The first: infrastructure, social and security investments. A second leg in support of farmers, already has earmarked an additional 120 million US dollars from the IDB for rural roads and 50 million to help farmers finance crops. Finally the plan includes a special system of concessions and closer coordination between government and private sectors in areas where heavy investment is needed. Borda said he expects to have the bill ready to send to Congress sometime between next March and April, and recalled that back in 2003, when Paraguay also faced a financial emergency, the previous administration managed to garner a majority consensus. "We're facing an international crisis, not home made, so the members of Congress, I'm sure will know how to react to the request from the Executive", he concluded.