MercoPress. South Atlantic News Agency

Paraguay increasingly attractive to direct investments

The new government of President Santiago Peña has proven to be friendly to direct investments

According to the Central Bank of Paraguay (BCP), direct investment in the South American country reached a record US$ 725 million last year, it was reported Tuesday in Asunción.

The BCP has published its latest report on direct investment (DI) in the country, highlighting a positive net flow of US$ 725 million during 2022. This value represents a significant increase of US$ 540 million from the previous year, with gross inflows of US$ 2.23 billion and gross outflows of US$ 1.505 billion.

The highly volatile international context allowed Paraguay to attract investments originally destined for other regions of the world, thus positioning the South American country as one of the most attractive destinations for investors.

BCP's Chief Economist Miguel Mora pointed out that Paraguay has optimal conditions to receive investments. The new government of President Santiago Peña has proven to be friendly to direct investments and has implemented incentives to promote business opportunities.

Mora highlighted Paraguay's macroeconomic stability as a crucial factor attracting investors and expressed confidence that these conditions will be maintained in the coming years.

The BCP expert also mentioned that there were several projects under development, such as the production of biofuels, green hydrogen, meat processing plants, and the cellulose industry, which are expected to have a significant impact on the country's manufacturing and primary sector.

However, international economic conditions, such as interest rates in the United States and other developed countries, may be delaying some projects. Despite this, Mora noted that the flow of investments in Paraguay is greater than in previous years.

In the breakdown by economic activity in 2022, an increase in net DI flows was observed in sectors such as financial intermediation, commerce, chemical production, oil processing, and metal products, although a decrease in net flows was seen in areas such as communication, livestock, transportation, and machinery and equipment.

Direct investment in Paraguay continues to be a fundamental pillar of the country's economic development, and good prospects indicate that this positive investment flow could be maintained in the future.