The Guarani country maintains an economy highly dependent on agriculture, its main export product being soybeans and other grains.
The Paraguayan economy is still very dependent on agriculture, which is why the World Bank recommends diversifying exports.
As a small, open economy that primarily exports
agricultural products and hydroelectric energy, Paraguay is vulnerable to extreme meteorological phenomena such as droughts and floods, explained Shen Yoong, World Bank economist for Paraguay when asked about the risks they observe for the growth of the Paraguayan economy.
The World Bank predicts that the Paraguayan economy will grow around 3.8% this year, this on top of a growth of 4.6% in 2023. This figure places the Guaraní country among the fastest growing economies in the region.
However, the challenges pointed out by Shenn Yoong also lead to a reflection on what actions should be taken in the future to correct these situations so that more sustainable and stable growth can be achieved over time.
The World Bank economist also indicated that the country's growth is also exposed to the economic evolution of its main trading partners, such as Brazil and Argentina.
Given these existing challenges, the professional recommended the implementation of policies to maintain macro fiscal stability and deepen the financial sector, in addition to measures to diversify exports towards sectors that do not depend so much on natural resources, could help Paraguay reduce negative impacts. of these events in the economy.
ECONOMIC ACTIVITY IN THE FIRST TWO-MESTER OF THE YEAR
However, in this first two months of the year, the country's economic activity has been showing diversification in the recovery of other sectors. According to preliminary data from the Monthly Indicator of Economic Activity of Paraguay (Imaep), a rebound of 5.9% was reported and when excluding agriculture and binationals, the growth figure was 6.5%, higher than the general index.
During a press conference last week, William Maloney, chief economist of the World Bank for Latin America and the Caribbean, highlighted that Paraguay will have comfortable growth this year, after having grown 4.6% in 2023, which leaves it in a good position. compared to the rest of the countries in the region, even larger economies, which also positions it as a “good place to do business.”
Maloney added that the country will continue to develop a strong agricultural sector and among the challenges to stop further development over time and ensure competitiveness is to continue investing more in education and training, highlighted the World Bank economist.
