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Paraguay's private sector insists in joining the Pacific Alliance

Friday, April 25th 2014 - 10:33 UTC
Full article 3 comments
Eduardo Filippo and German Ruiz, insist that Paraguay and the Alliance members economies are complementary  Eduardo Filippo and German Ruiz, insist that Paraguay and the Alliance members economies are complementary

Paraguay has an economy which is complementary to the Pacific Alliance block and has become a very interesting option to increase trade, argued the country's main business organizations, Paraguay's Industrial Union and the Paraguay Rural Association.

 The Pacific Alliance created in April 2011 has as full members Chile, Peru, Colombia and Mexico, and Colombia currently holds the rotating presidency. Paraguay as another thirty countries has an observer status and is intent in becoming full member of the trade block. Paraguay is also a founding member of the stalled Mercosur group which includes Argentina, Brazil, Uruguay and Venezuela.

“In Mercosur members compete among themselves because they have similar productions, but with the Pacific Alliance it's different since Paraguay can export mainly food, while it could import oil, gas and a battery of industrial inputs for our manufacturing”, said Eduardo Felippo, president of Paraguay's Industrial Union.

“This means Alliance members and Paraguay's economies are complementary, we have what they are needing and if we become a full member trade between that region and Paraguay can only be expected to soar”, added Germán Ruiz, president of Paraguay's Rural Association.

Paraguay is already a significant supplier of beef to Peru and Chile, plus rice, soybeans and corn, “which means there is margin to keep expanding trade”.

However economist and former Paraguayan Finance minister César Barreto said that although tempting, closer links between (land-locked) Paraguay and the Pacific, even with complementary economies “face geography and physical barriers”.

But Felippo said that the situation could not be worse than currently with Argentina creating artificial barriers to block Paraguay's trade, “we are thinking of a land link through Bolivia directly to Chile and Peru”

“I think it's an encouraging move to look for other options so that we are not trapped by Mercosur, basically a trade accord which has been stalled for a long time and is also preventing us from making trade agreements with other countries”, indicted Barreto, who immediately added, “we must not abandon Mercosur, despite the inconveniences, we are too vulnerable”.

The Pacific Alliance is holding its next summit on 22 June in Mexico and Colombia has invited Paraguayan representatives to the event. However to achieve the full member condition, Paraguay has yet to reach agreements with each of the Alliance's members.

Meanwhile Mercosur still has its latest summit, originally scheduled for last December, pending because of successive suspensions. The last summit was held in Uruguay on July 2013 and the December meeting was to be held in Caracas, but the political situation in Venezuela has derailed all plans.

Top Comments

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  • CJvR

    Geography is working against Paraguay here, that and the regimes in Mercosur which have already shown themselves willing to use questionable means of keeping Paraguay in line.

    Apr 25th, 2014 - 01:18 pm 0
  • Condorito

    Geography is only a problem because there isn't a sensible country between Paraguay and Chile. If we could get a route through southern Bolivia to Paraguay, the north of Chile could benefit from cheap electricity and Paraguay could get its produce to the Pacific. Unfortunately Bolivia could never be relied upon.

    Apr 25th, 2014 - 02:14 pm 0

    Ola Condorito -

    View this in reverse. Bolivia exports, and desires increase shipping in the South Pacific. That path can be financially rewarding for Chile. It can be done.

    I am confident that a solution for Paraguay can also be worked out.

    MERCOSUL = Political posturing, no clear voice or message, and a stalled organization. Venezuela and Argentina cannot tie their own shoes, let alone deal responsibly with Brasil, or the EU.

    PACIFIC ALLIANCE = Dynamic, business oriented, and growing.

    Apr 26th, 2014 - 09:31 pm 0
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