MercoPress. South Atlantic News Agency

Paraguay's economy grows 5.9% in first semester of 2025

Agriculture was the only major sector to yield negative overall results

According to the Central Bank of Paraguay's (BCP) “Quarterly National Accounts” report released on Friday in Asunción, the South American country's quarterly Gross Domestic Product (GDP) grew significantly, resulting in 5.9% year-on-year growth in the first semester of 2025, following positive outcomes in most sectors.

Services led the economy with a 6.8% year-on-year increase in Q2, accumulating 6.4% growth. This was driven by strong performance in commerce, financial services, transport, and household services.

Electricity and Water saw the highest figures, with a 14.3% year-on-year increase in Q2, accumulating 11% growth, boosted by binational companies.

Construction grew 4.5% interannually, accumulating 8.6% growth, due to a faster pace in both private and public works.

Livestock, Forestry, Fishing, and Mining increased by 4.8% year-on-year, accumulating 7.7% growth.

Manufacturing grew 4.3% year-on-year, accumulating 5.6% growth, with positive results in meat, oil, sugar, and various other industries.

However, Agriculture was the only major sector to record a negative result, with a year-on-year decline of 3.1% in Q2 and a cumulative contraction of 3.2%. This downturn was attributed to lower soybean production levels, although increased production of other crops such as corn, rice, and cotton partially offset the decline.

At the same time, Domestic Demand expanded significantly, registering a year-on-year growth of 12.4% in Q2, driven by increasing private consumption and a strong uptick in gross fixed capital formation (22.4% year-on-year growth). This favorable performance was partially mitigated by negative impacts from government consumption and net exports.

While meat, oil, sugar, leather and footwear, chemicals, textiles and clothing, metal products, mills and bakeries, paper, and other food products had a positive impact on the overall results, the balance was curtailed by negative variations in dairy products and wood, the BCP noted.