RESTRICTED  
  
WT/TPR/G/360  
2 August  2017 
(17-4166) Page: 1/22 
Trade Policy Review Body  Origin al: Spanish  
 
  TRADE POLICY REVIEW  
REPORT BY  
PARAGUAY  
Pursuant to the Agreement Establishing the Trade Policy Review Mechanism (Annex 3 of the 
Marrakesh Agreement Establishing the World Trade Organization), the policy statement by 
Paraguay is attached.  
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the 
first session of the meeting of the Trade Policy Review Body on Paraguay.  WT/TPR/G/360 • Paraguay  
 
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  CONTENTS  
INTRODUCTION  ................................ ................................ ................................ ...............  3 
1   ECONOMIC AND TRADE ENVIRONMENT  ................................ ................................ ....... 4 
1.1   Outlook  ................................ ................................ ................................ ......................  5 
2   MAIN ECONOMIC REFORMS  ................................ ................................ .........................  7 
3   MULTILATERAL, REGIONAL AND BILATERAL TRADE NEGOTIATIONS  ..........................  9 
3.1   World Trade Organization (WTO)  ................................ ................................ ...................  9 
3.2   MERCOSUR  ................................ ................................ ................................ ................ 10 
3.3   MERCOSUR and regional trade agreements  ................................ ................................ ....11 
3.4   Membership of the OECD Development Centre  ................................ ............................... 11 
3.5   Vienna Programme of Action for Landlocked Developing Countries  ................................ ....11 
4   INSTITUTIONAL AND REGULATORY FRAMEWORK  ................................ .....................  13 
4.1   National Development Plan 2030  ................................ ................................ .................. 13 
4.2   Tariff profile  ................................ ................................ ................................ ............... 13 
4.3   Customs regime  ................................ ................................ ................................ ......... 13 
4.4   Trade facilitation  ................................ ................................ ................................ ........ 14 
4.5   Agriculture  ................................ ................................ ................................ ................. 14 
4.6   Livestock  ................................ ................................ ................................ ................... 15 
4.7   Trade in services  ................................ ................................ ................................ ........ 15 
4.8   Trade and environment  ................................ ................................ ............................... 15 
4.9   National energy policy  ................................ ................................ ................................ .16 
4.10   Intellectual property  ................................ ................................ ................................ ..17 
4.11   Government procurement  ................................ ................................ .......................... 17 
4.12   Protection of competition  ................................ ................................ ........................... 18 
4.13   Electronic commerce  ................................ ................................ ................................ .18 
4.14   Business climate  ................................ ................................ ................................ .......19 
4.15   Infrastructure development and public works  ................................ ............................... 19 
4.16   Securities market  ................................ ................................ ................................ .....20 
4.17   Support for small and medium -sized enterprises ................................ ........................... 20 
4.18   Women and trade  ................................ ................................ ................................ .....21 
5   CONCLUSIONS AND DIRECTIONS OF FUTURE POLICY  ................................ ...............  22 
 
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  INTRODUCTION  
1. During the period covered by this fourth review of Paraguay 's trade policy, the global 
economy has grown steadily with significant effects on international trade . The main feature s of 
world economic developments  were major volatility on financial markets, uncertainty over 
international commodity prices , and the resurgence  of protectionist measures.  
2. Nonetheless, Paraguay 's macro economi c environment has been positive with sustained 
economic growth underpinned by sound economic foundations, more buoyant domestic demand, 
conditions conducive to external finance and a considerable rise in exports, especially of oilseeds, 
meat products and e lectricity.  
3. The level of economic activity in Paraguay during the review period was influenced by the 
design and implementation of market -oriented economic policies that made for an excellent 
business climate, together with good harvests for the main crops , a steady increase in livestock 
production, the opening of new markets, an expansion of manufacturing and a rise in public and 
private construction , among other factor s. 
4. Paraguay was not significantly affected by the slowdown in economic growth experience d by 
its main trading partners ; indeed, it has become the fastest growing economy in MERCOSUR.  
5. One fact worthy of note was the launch in 2014 of the Par aguay National Development 
Plan 2030 which sets out the approach taken by the National Government, focus ing on three major 
strategic priorities : (i) poverty reduction and social development ; (ii) inclusive economic growth ; 
and (iii) appropriate integration into the world economy.  
6. This report comprises five sections . The first sets out how the Paraguayan econ omy has 
focused on growth in a challenging regional and inter national economic environment . The second 
focuses on the reforms introduced by the Government during the review period . The third 
describes bilateral, regional and multilateral tra de negotiations , including the  deepening and 
convergence of existing agreements  and negotiation of  new ones. The fourth section sets out the 
most important aspects of the country 's trade policy . Finally, the fifth presents our conclusions and  
outlines  the thrust of futur e policy.  
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  1  ECONOMIC AND TRADE ENVIRONMENT  
1.1.  Over the last decade the Paraguayan economy has enjoyed macroeconomic stability, healthy 
public finances and a steady rise in Gross Domestic Product  (GDP) . Annual growth in real GDP 
averaged 4.8 % between 2011 and 2016, and in 2013  was the second h ighest in the world, 
at 14%. This strong  performance of the economy was underpinned by buoyant agricultural 
production, the recovery of domestic demand , and public and private investment.  
1.2.  As in the previous review period, the services sector is the chief component of GDP1, 
accounting for 43.9 % of the total in 2016 ; it is followed by manufacturing (10.7 %), agriculture 
(18.7 %), construction (4.2 %) and livestock (5.3 %). The largest subsector in terms of value added 
is commerce  (14.3 % of GDP in 2016), followed by general government services (7.9 %). The 
agricultural sector (agriculture, livestock , forestry and fisheries) accounted for 25.2 % of GDP . 
Paraguay is the world 's sixth largest producer of soya  beans  and its by -products, and the 
fourth  largest exporter of oilseeds . It is the world 's fourteenth largest producer of fresh or chilled  
meat and the seventh largest exporter of frozen beef.  
1.3.  During the review period, several sectors became increasingly buoyant, attaining higher rat es 
of real growth than in previous years in sectors such as financial services (10.2 %), agriculture 
(7.9%) and construction (7.7 %). This was reflected in the share of employment accounted for by 
those sectors . For example, agriculture employs 25 % of the ec onomically active population ; the 
figure for commerce, restaurants and hotels has stabilized at 26.6 %; the community, social and 
personal services sector employs 24.5%; and manufacturing, mining and quarrying 12.3 %. 
1.4.  The open unemployment rate2 has continue d to be moderate and relatively stable during the 
review period, fluctuating between 5 % and 6 %. 
1.5.  During the period under review the public finances remained stable and the central 
government posted operating surpluses thanks to the implementation of prudent  fiscal policies and 
better  tax management . Adopted in 2013, t he Law on Fiscal Responsibility limits the central 
government deficit to 1.5 % of GDP and provides that the annual increase in primary current 
expenditure for the public sector may not exceed the  interannual inflation rate plus 4 %. As a result 
the deficits in the overall central government balance have been moderate.  
1.6.  As at  March  2017, Paraguay had made four sovereign bond issuances  on the international 
market . The first , in 2013 , was for US$500  million ten-year bonds, and the  second , in 
August  2014, for US$1  billion 30 -year bonds . In March  2016 Paraguay sold a further 
US$600  million  worth  of ten-year bonds , and  in March  2017 a fourth issuance  was for 
US$500  million ten -year bonds . Paraguay 's sovere ign bonds have performed well on the secondary 
market with yields of around 4 % for the 2023  Bond and the 2026  Bond, and 5.7 % for 
the 2044 Bond.  
1.7.  In order to support the country 's strong economic performance the Central Bank of Paraguay 
(BCP) has maintained an accommodative monetary policy underpinned by an inflation -targeting 
regime and a floating exchange -rate system . Annual inflation between 2011 and 2016 averaged 
around 4.2 % and the real multilateral exchange rate appreciated by around 4 % with some 
fluctu ations over that period . The BCP intervenes only occasionally in the exchange markets in 
order to mitigate the effects of sharp swings  that are not in line  with market fundamental s. 
1.8.  The banking system is sound, with  steady growth in lending  to the  private sector and a 
continuous  rise in deposits, a low level of non -performing assets and low average interest rates 
compared with historical levels, reflecting the improved  expectations of economic operators . 
Between 2011 and 2016 lending to the private sector r ose by 163.1 %, equivalent to 133.9 % in 
real terms . 
1.9.  The country 's Net International Reserves (NIR) have a lso risen since 2011, from 
US$4,984  million in December  2011 to US$7,144  million in 2016 . Prudent fiscal and monetary 
                                                
1 Information provided by the Central Bank of Paraguay.  
2 Information provided by the Directorate -General of Statistics, Surveys and Censuses (DGEEC).  WT/TPR/G/360 • Paraguay  
 
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  policies have enabled the BCP to s ecure a record level of international monetary reserves . 
Paraguay has thus become more solvent, with a n NIR/GDP ratio equivalent to about 26 % in 2016.  
1.10.   Also worthy of note is the ruling in favour of Paraguay in a complaint  for the enforcement  of 
an unlawful  debt that was precluding it from using its international reserves . Since the start of 
June 2017,  the steps taken by the N ational Government  have made  the international reserves 
freely available for the BCP to manage on the financial market.  
1.11.   The external s ector was boosted by the country 's economic growth during the period under 
review, which was the result of strong performance in the agricultural sector, sales of electricity, 
and more vigorous domestic economic activity . With the exceptions of 2012 and 20 15, Paraguay 's 
balance -of-payments current account has been in surplus.  
1.12.   Paraguay 's external trade in goods and services represented  83.7% of GDP in 2016 . The 
structure of exports is the same as in the previous review period : sales of agricultural products 
and foodstuffs accounted for almost two thirds of exports of goods in 2016, among which the 
oilseed complex ( soya beans , sunflower, rapeseed) became established as the chief export product 
(36.9 % of the total in 2016), followed by fresh, chilled  or frozen beef (13.6 %), and cereals 
(8.1%). Manufacturing 's share of exports was around 10 %, led by  medicaments, leather articles 
and made -up textile articles . 
1.13.   Exports of electricity rose to US$2, 132 million in 2016 , an increase of 4.7 % compared 
to 2015, making Para guay the world 's leading exporter of hydroelectricity.  
1.14.   Paraguayan exports go mainly to MERCOSUR part ners, the European  Union and other 
Latin American countries . In 2016, almost 50 % of exports went to MERCOSUR countries, among 
which Brazil is the main desti nation market . Also noteworthy is the rise in exports to the 
Russian  Federation and the countries of the Persian Gulf.  
1.15.   The performance of imports has varied over recent years, falling from US$11, 784.5 million 
in 2011 to US$9, 788.8 million in 2016 . The lead ing imports are machinery and transport 
equipment, which accounted for 32 % of the total in 2016, followed by chemicals with 9 %. 
1.16.   When broken down  by category , Paraguay 's imports comprise  one third consumer goods 
(US$3,165  million in 2016) ; one third capital  goods (US$3,089  million in 2016) ; and 
one third intermediate goods (US$2, 789 million  in 2016) . The main origins of imports are the 
MERCOSUR countries, China, the European  Union and the United  States.  
1.17.   The foreign direct investmen t (FDI) balance was US$4,41 0 million in 2015 . As in the report 
for the previous review, the United  States was Paraguay 's largest investor, followed by Brazil and 
Spain . FDI is heavily concentrated in financial intermediation, telecommunications and vegetable 
oil production . Other a reas that benefit ed from significant FDI flows were commerce, transport, the 
chemicals industry and meat production.  
1.18.   Paraguay is a signatory to the Montevideo Protocol, which seeks to promote free trade in 
services between the MERCOSUR countries . The Protoc ol was incorporated into Paraguayan 
domestic law  by Law No 5.268/2014 Adopting the Protocol of Montevideo on Trade in Services in 
the Southern Common Market (MERCOSUR).  
1.1  Outlook  
1.19.   Paraguay 's economic outlook is encouraging : both the government and internation al 
economic bodies forecast economic growth of around 4.2 % for 2017 , with a good outlook for 2018 
too, making  Paraguay one of the fastest -growing economies in the region.  
1.20.   Together with macroeconomic stability and fiscal solvency, the foundations for growth  will 
be gross fixed capital formation, major infrastructure projects and the consolidation of the 
agro-export sector . The projection for 2017 is for a fiscal deficit of around 1.5 % of GDP in line with 
the limit set by the Law on Fiscal Responsibility, and  a central government operating surplus 
of 1.8% of GDP . The deficit should fal l gradually in subsequent years to reach  0.3% in 2019.  WT/TPR/G/360 • Paraguay  
 
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  1.21.   The Central Bank has managed to maintain year-on-year inflation around the inflation 
targe t and expectations are anchored,  providing  a predictable nominal framework for economic 
agents  to make  consumption and investment decisions.  
1.22.   In line with the Paraguay 2030 Development Plan, national economic policy will be geared 
to consolidating the pace of inclusive economic growth base d on greater diversification of 
production and the involvement of all sectors of society . The National Government will continue to 
focus its efforts on improving conditions to facilitate investment in the country, and to promote 
free competition and free m ovement of capital, market access and scientific and technological 
transfer, together with a solvent financial market.  
1.23.   Paraguay also attaches importance to reducing its logistics costs in international trade, 
especially those associated with its status as a landlocked developing country . Accordingly, the 
Paraguay Masterplan for Transport and Logistics sets out the general outline for developing 
infrastructure and connectivity.  
1.24.   With the aim of improving and raising international awareness of the country's ec onomic 
development, the Government launched t he Marca País Paraguay (Trademarking Paraguay)  
programme  at the beginning of 2017 . Marca País Paraguay is based on three drivers of national 
economic development : inclusive growth, feeding  the world, and buildin g and developing 
infrastructure to link regions.  
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  2  MAIN ECONOMIC REFORMS  
2.1.  Paraguay introduced the Law on public -private partnership  (Law No. 5.102/2013), which 
aims to promote investment in public infrastructure and provision of services through partnership s 
between public and private entities . The Law also promotes investment in the production of goods 
and the provision of public services.  
2.2.  A new Law on the Protection of Investment (Law No.  5.542/2015) was enacted  with the goal 
of promot ing investment in cap ital-intensive industries . It protects the remittance of capital and 
profits, provides guarantees against administrative and judicial practices that could be deemed 
discriminatory, and allows tax breaks  for up to 20  years.  
2.3.  The Law on Electronic Commerce (L aw No.  4.868/13) was promulgated in 2013 . Its purpose  
is to regulate trade and procure ment carried out by  electronic or technological ly equivalent means, 
between suppliers of goods and services delivered remotely by electronic means, intermediaries in 
the transmission of data via telecommunications networks, electronic commercial communications, 
and consumers or users . The Law also confers legal force and validity on contracts entered into 
remotely by electronic means , and  recognizes the validity for accoun ting and tax purposes of 
electronic invoicing.  
2.4.  The Law on Micro, Small and Medium -Sized Enterprises - MSMEs , No.  4.457/2012, was 
enacted  in 2012 . Its aim is to provide for a regulatory framework to promote and foster the 
establishment, development and comp etitiveness of such ent erprises  with a view to integrating  
them into the formal structure for producers of goods and services and hence  into international 
market s as well . 
2.5.  The Law on the Protection of Competition (Law No.  4.956) was also enacted in 2013 . Its 
purpose is to protect and promote free market competition and to prohibit and punish abuse of 
dominant position and mergers.  
2.6.  Law No.  4.798 of 2012 established  the National Intellectua l Property Directorate (DINAPI)  as 
the institution with responsibility  for implementing national policy on intellectual property and for 
the administrative enforcement of the rules safeguarding intellectual property rights.  
2.7.  In 2013 Law No.  4.986/13 was adopted, creating the unified system for setting up and 
closing  down  a business (SUACE) . SUACE operates as a single window for applications and the 
formalities involved in establishing and closing a business so as to facilitate and speed up the 
process.  
2.8.  Enacted in 2012, Law No.  4.427  provides for incentives for the production, development or 
assembly of high technology or advanced technology goods, especially in the areas of electronics, 
telecommunications and information technology.  
2.9.  In order to promote the establishment of industrial parks to encourage industrial activity, Law 
No. 4.903/13 was enacted to provide  incentives and other benefits in this area. 
2.10.   A significant measure to combat corruption was the creation  of the National Anti -Corruption 
Secretariat (SENAC) under D ecree No.  10.144 of 28  November  2012, which established  SENAC as 
the body responsible for leading the design and delivery of public policies to combat corruption and 
promote integrity and transparency in national institutions . This ensures that strict control and 
oversight are exercised over  the actions of the p ublic authorities in relation to  the main civil 
society stakeholders . The National Corruption Prevention Plan was established under Decree 
No. 4.900/15 in the aim of laying firm foundations to foster a climate of greater transparency and 
integrity in the country 's public institutions.  
2.11.   In line with the principle of transparency, in 2014 Paraguay enacted Law No.  5.282 on Free 
Public Access to Public Information and Transparency in Government . The Law seeks to promote 
transparency on the part of the State and to guarantee the right of access to public information for 
all by implementing detailed procedures, time -frame s, derogations and penalties.  WT/TPR/G/360 • Paraguay  
 
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  2.12.   In 2015 a National Transparency Team was established, comprising the institutions that 
make up the Economic Cabinet and the National Anti -Corruption Secretariat . Its purpose is to 
implement plans to improve Paraguay 's ranking in corruption perception indexes by supporting its 
actors in implementing diagnostic reviews and specific measures to communicate progress in 
transparency both nationally and internationally.  
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  3  MULTILATERAL, REGIONAL AND BILATERAL TRADE NEGOTIATIONS  
3.1.  Paraguay promotes an open, inclusive, non -discriminatory, rules -based international trading 
system . Accordingly it participates in the various discussio n forums for trade issues and in the 
negotiation of trade agreements at bilateral, regional and multilateral level.  
3.1  World Trade Organization (WTO)  
3.2.  During the period under review, Paraguay has actively participated in negotiations at the 
WTO, especially tho se concerning the packages agreed at the Ministerial Conferences in Bali 
(2013) and Nairobi (2015) . It may  be noted here that Paraguay played a leading role in the 
discussions to reach the Agreement on Trade Facilitation and the Decision on Agricultural 
Competition.  
3.3.  Paraguay supports the conclusion of the Doha  Round and is a member of various negotiating 
groups , including the G -20 and the Cairns Group , and acts as the coordinator for the Landlocked 
Developing Countries Group  at the WTO . Paraguay believes that strengthening the multilateral 
trading system is crucial for developing and least developed countries , underpinning  their plans for 
economic growth that will enable them to enjoy greater access to value chains and world markets.  
3.4.  Paraguay is confident th at the Agreement on Trade Facilitation will become a key tool in 
reducing the logistics costs of international trade, especially the additional costs incurred by 
landlocked developing countries as a result of transit procedures through third countries.  
3.5.  Paraguay also attaches great importance to the three pillars of the agricultural negotiations 
(market access, export subsidies and domestic support) in achieving true liberalization and reform 
of the agricultural market . We welcome the success of the Nairobi Ministerial Conference and look 
forward to its prompt implementation by Member s. We also consider it important to achieve 
positive outcomes on domestic aid and market access at the next Ministerial Conference, to be 
held in Buenos  Aires.  
3.6.  In order to achiev e consensus and build bridges between very polarized positions, the 
delegation of Paraguay has  sponsored or cosponsored  various proposals to reduce tariffs, tariff 
peaks and tariff escalation for agricultural goods.  
3.7.  While  Paraguay supports the successful c onclusion of the Doha Round matters, it is also 
active in discussions of issues involving current trade  developments such as electronic commerce, 
investment  facilitation,  and support for micro, small and medium -sized enterprises . In that regard 
Paraguay ha s co-sponsored a number of documents and concept notes on some of these issues, 
and hopes to achieve a result at the Buenos  Aires Ministerial Conference.  
3.8.  Between 2012 and 2016, Paraguay received technical assistance from the WTO in various 
areas, especiall y agriculture, trade in services, intellectual property and trade facilitation . 
Additionally, many government officials have benefited from courses and training programmes 
delivered and/or directed by the WTO . Over 200  public servants received direct train ing under 
various modalities  offered by the WTO and 11  national technical -assistance activities were carried 
out during the period under review.  
3.9.  As regards  the WTO dispute settlement mechanism, during the period under review, 
Paraguay participated in a num ber of disputes as a third party : horticultural and animal products 
(DS 455, 477, 478) ; chicken meat and chicken products (DS484 ) domestic support for agricultural 
producers (DS511) ; and measures concerning traffic in transit (DS512).  
3.10.   Finally, as a demonst ration of its commitment to the multilateral trading system, Paraguay 
has held the Chair of the Committee on Trade and Development, the Committee on Sanitary and 
Phytosanitary Measures and the Vice -Chair of the Committee on Market Access and the Committee 
on Import Licensing.  WT/TPR/G/360 • Paraguay  
 
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  3.2  MERCOSUR  
3.11.   Paraguay is a founder member of the Southern Common Market (MERCOSUR) ; the 
organization constitutes one of the mainstays of its foreign policy, its main regional integration 
objective , and its platform for the negotiation of a greements beyond the MERCOSUR region . 
Paraguay is undergoing a process of becoming more deeply integrated into MERCOSUR and 
achieving the objectives set out in the Treaty of Asunción.  
3.12.   MERCOSUR has maintained its importance as a destination and origin for P araguay 's exports 
and imports and is the country 's chief trading partner . Between 2014 and 2016 the share of 
exports to the bloc rose from 39.35 % to 48.09 % of Paraguay 's total, wh ile the share of imports 
fluctuated between 40.05 % and 43.14 %. 
3.13.   Since joining  MERCOSUR, Paraguay has used the MERCOSUR Common External T ariff (CET) 
as a trade policy instrument . Last January the MERCOSUR Common Nomenclature and the 
Common External T ariff 2017 (based on HS  2017) were incorporated  into domestic law by  Decree 
No. 6.655 /16. The level of the CET is the base applied to imports from outside the MERCOSUR 
area save for case -by-case exceptions authorized by the bloc . The exceptions allow Paraguay to 
apply tariffs that are lower than the CET to imports originating outside the a rea, thus maintaining 
the profile of an economy that is open to the rest of the world.  
3.14.   In order to promote the competitiveness of the MERCOSUR countries, especially the bloc 's 
smaller economies, the deadlines for implementation of some of the trade policy instruments were 
extended as set out in the following Decisions of the Common Market Council (CMC) of 
MERCOSUR : No. 32/15 on the regime governing MERCOSUR origin, which recently entered into 
force; No. 26/15 on National Exception Lists ; No. 24/15 on Specia l Import Regimes ; and 
No. 25/15 on Capital Goods and Information Technology and Telecommunications Products . 
3.15.   Another important MERCOSUR achievement in overcoming asymmetries is the 
establishment of the MERCOSUR Structural Convergence Fund (FOCEM) . Founded by MERCOSUR 
itself, t his financial mechanism for the bloc itself is intended for projects to promote structural 
convergence, develop competitiveness, foster social cohesion , support the functioning of the 
institutional structure and strengthen the integrat ion process . FOCEM was approved for a ten -year 
period in 2005 and extended for a further ten years in 2015 ; the legal formalities for extending the 
FOCEM are undergoing the necessary domestic procedures  in MERCOSUR m ember States.  
3.16.   To date 17  exclusive proje cts have been approved for Paraguay involvin g the allocation 
of US$665,818,000  in FOCEM resources.  
3.17.   In the area of production activities and processes, in 2008 MERCOSUR adopted CMC 
Decision  No. 12/08 approving the "MERCOSUR Productive Integration Programme ", aimed at 
strengthening the complementarity of production of MERCOSUR enterprises, focusing on the 
integration of production chains both of SMEs  and o f businesses in  Relatively Less Economically 
Developed Countries in order to deepen integration  across th e bloc . Under this framework , CMC 
Decisio n No. 39/14  on the  MERCOSUR Guarantee Fund for Micro, Small and Medium -Sized 
Enterprises was approved, which will reinforce increased competitiveness and external integration 
of such enterprises  of member States.  
3.18.   Additionally, the Protocol on Intra -MERCOSUR Investment Cooperation and Facilitation was 
signed  in 2017 , which will provide predictability to investors and encourage investment flows 
between the bloc 's member countries.  
3.19.   Finally, it is important to add that CMC Decision  No. 56/15 approved an Action Plan to 
strengthen the trade -related and economic facets of MERCOSUR.  
3.20.   In terms of the political and social aspects of MERCOSUR, the bloc enhanced its  Social 
Chapter to focus on  responding to the most basic and press ing needs of its peoples and enabling 
MERCOSUR citizens to participate through various mechanisms ; and its Political Chapter , allowing  
the bloc to take up non -trade matters with multilateral international bodies . Of note in this regard 
are CMC Decision  No. 10/15 on MERCOSUR Social Movements and Organizations and the 
establishment and operation of the MERCOSUR Parliament.  WT/TPR/G/360 • Paraguay  
 
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  3.3  MERCOSUR and regional trade agreements  
3.21.   In conformity with CM C Decision  No. 32/00, the MERCOSUR member States negotiate trade 
agreements jo intly both within the Latin American Integration Association (LAIA) and at 
extra-regional level . During the period under review Agreements were signed with Palestine 
(2011)  and Egypt (2016), together with a Framework Agreement with the European Free Trade 
Association (EFTA) . Additionally, MERCOSUR is in negotiations to deepen and broaden the Fixed 
Preference Agreements signed with India and the Southern African Customs Union (SACU).  
3.22.   MERCOSUR and the Pacific Alliance also have a mechanism for dialogue in whi ch they are 
exploring areas of common interest in relation to regional economic integration . Work streams 
have been identified in trade facilitation, customs cooperation, trade promotion, support for SMEs, 
and possible regional value chains.  
3.23.   MERCOSUR is ne gotiating a number of free  trade agreements with countries and groups of 
countries, including notably the European  Union and EFTA . It is also holding an exploratory 
dialogue with Canada, Japan, the Republic  of Korea, Lebanon, Guyana, Suriname, Australia, 
New Zealand and Tunis ia. 
3.4  Membership of the OECD Development Centre  
3.24.   Since March  2017, Paraguay has been part of the Development Centre of the Organisation 
for Economic Co -operation and Development (OECD), an international forum that will enable 
Paraguay to c oordinate the design and implementation of public policies and good practi ce to 
maximize inclusive growth and  economic and social development, and to receive advice and share 
experience via a platform for dialogue with OECD member countries.  
3.25.   Development an d economic stability, policies for transparency , and the potential for growth, 
stability and reliability were factors that influenced Paraguay 's early membership of the 
Development Centre . The reforms currently under way in education, health and social inc lusion  are 
other aspects associated with the country 's participation in the Centre . 
3.26.   It should be noted that Decree No.  4.992/15 provided for the establishment of an integrated 
Inter-Institutional Commission to lead and coordinate the process of moving Para guay closer to 
the OECD . The institutions that make up the Commission participate in various OECD committees 
and working groups so that they can pool experience , examine the possibility of adopting the 
organization 's international standards , and make headw ay towards acceding to its various 
instruments . Of note is Paraguay 's progress in moving into line with the OECD scheme for Varietal 
Certification of Seed Moving in International Trade and its participation in working groups on 
investment, global value cha ins and the OECD Regional Prog ramme for Latin America and 
the Caribbean.  
3.27.   In June 2016 Paraguay was accepted as a member of the OECD Global Forum on 
Transparency and Exchange of Information for Tax Purposes . In the same year it joined the new 
Inclusive Fram ework on BEPS (Base Erosion and Profit Shifting , i.e. reforms to the international 
tax system to halt tax avoidance by multinational enterprises) , which consists in the gradual 
adoption of fiscal reforms that will mitigate tax base erosion and profit -shifting. The OECD will 
draw up recommendations for Paraguay to follow so that the country will gradually adopt 
international standards on fiscal transparency ; an assessment on implementation of the 
recommendations is expected around 2020 . 
3.28.   Paraguay is conductin g two country reviews with the OECD that will help it to identify the 
main barriers to social and economic development and the institutional challenges that the country 
faces. The reviews in question are a Multi -dimensional Country Review and a Public Gove rnance 
Review . They will be concluded and published in 2018 and 2019 and will set out policy 
recommendations in the areas concerned.  
3.5  Vienna Programme of Action for Landlocked Developing Countries  
3.29.   Approved in October  2014, t he Vienna Programme of Action (VP oA) strengthens the 
international community 's commitment to landlocked developing countries . The Programme runs WT/TPR/G/360 • Paraguay  
 
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  for ten years, from 2014 to 2024, and sets out six priorities for action : (1) Fundamental transit 
policy issues ; (2) Infrastructure development and maintenance ; (3) International trade and trade 
facilitation ; (4) Regional integration and cooperation ; (5) Structural economic transformation ; and 
(6) Means of implementation.  
3.30.   It should be stressed that t here is a direct link between the Vienna Program me, 
the 2030 Agenda for Sustainable Development and the Addis Ababa Action Agenda . 
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  4  INSTITUTIONAL AND REGULATORY FRAMEWORK  
4.1  National Development Plan 2030  
4.1.  The National Development Plan Paraguay 2030 ( PND 2030) is a strategic framework that sets 
out Paragua y's roadmap to sustainable, inclusive economic development . PND 2030 is 
approximately 80 % in line with the United Nations Sustainable Development Goals (SDG) . This is 
the first long -term roadmap to set out a national strategy and identify specific actions to be 
implemented by the public authorities when designing public policies.  
4.2.  The three main lines of action relate to the following objectives : (1) poverty reduction  and 
social development ; (2) inclusive economic growth ; and (3)  integration of Paraguay into  the world . 
Each goal reinforces the main strategies wi th specific plans that will guide and underwrite the 
targets set . These include mechanisms to ensure high -calibre employment, support for MSMEs , 
use and availability of renewable energy resources and t he embedding of national production 
resources into the region 's global value chains.  
4.2  Tariff profile  
4.3.  The tariff applied by Paraguay is based on MERCOSUR 's Common External T ariff (CET) and is 
set out in the MERCOSUR Common Nomenclature (NCM) as provided for in the Harmonized 
Commodity Description and Coding System (HS).  
4.4.  The weighted averages of import duties applied by Paraguay were 3.1 % in 2016, below the 
3.5% recorded in 2011 . These averages have been falling and have maintained the downward 
trend typical o f an open economy.  
4.5.  The exceptions to the CET that MERCOSUR allows Paraguay represent  around 18.6 % of tariff 
lines and can result in the application of tariffs that are lower or higher than the CET . The bulk of 
the tariff lines concerned are subject to tari ffs that are lower than the CET.  
4.6.  The exceptions to the CET include both the list granted exclusively to Paraguay, the national 
exception s list (LNE) , and the lists that are shared across MERCOSUR members, which are 
identified as capital goods (BK)  and info rmation technology and telecommunications products 
(BIT). The LNE comprises 709  headings and is in force until 31  December  2023. The BK list 
comprises 1,222  NCM headings . On this list, Paraguay can apply a tariff of 0 % until 
31 December  2021 and a tariff o f 2% until 31  December  2023. For goods classed as BIT, 
comprising 396  headings , the country can apply tariffs of 2 % and 0 % until 3 1 December  2023. 
The headings where the  applied  tariffs differ from the CET represent  81.7% of all three lists . The 
LNE and th e BK and BIT lists currently in force are specified in Decree No.  6.655/16.  
4.7.  In 2017 the average tariff applied by Paraguay (8.3 %) is lower than the MERCOSUR CET 
(11.5 %). 
4.8.  We should also point out that Paraguay has bound 100 % of its tariff li nes (all ad valo rem) in 
the WTO, and  these are applied under the Most Favoured Nation principle.  
4.3  Customs regime  
4.9.  The Customs Code (Law No.  2.422 of 5  July 2004) is the main piece of legislation governing 
the customs regime . Since 2011 the National Customs Directorate (DNA)  has issued a number of 
executive decrees, resolutions and other instruments governing specific aspects of customs 
processes in areas such as approved economic operators, the simplified clearance regime for minor 
imports, simplified clearance for imports f rom neighbouring countries , and the Single Window for 
Imports.  
4.10.   The Single Window for Imports (VUI) allows institutions that play a role in the import 
process to interact with the DNA to manage authorizations, permits and certifications for imports . 
Under Decree No.  3.002 of 29  January  2015, the VUI was enhanced with the Simplified Electronic 
Issuance System for import permits and licences . Responsibility for administration and operating 
procedures was vested in the DNA . The promulgation of the D ecree has ac hieved the following : WT/TPR/G/360 • Paraguay  
 
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  (a) significantly shorter waiting times for import licence authorizations ; (b) great er transparency in 
import licensing  proce dures ; (c) systematization  of import data, making the data easier to access 
for reporting purposes.  
4.11.   Additiona lly, in 2015 a Risk -Based Selection System (SBR) was established that assign s 
three selection channels to goods : green channel (automatic clearance with no inspection) ; 
orange  channel (document inspection) ; and red channel (document inspection, physical in spection 
and customs valuation inspection) . The system is already running in approximately 30 of the 
country 's customs offices.  
4.12.   In addition to the VUI and the computerized risk management system (SBR), other 
measures that have been adopted include the inte rmediate stage of implementation of the 
Authorized Economic Operator Programme (AEO) in Logistics Chain Security, the advance 
Electronic Manifest for Express Remittances, the advance electronic manifest for air cargo under 
the IATA XML standard, regulation s for usage of electronic seals, acquisition of non -intrusive 
inspection equipment, paperless  customs documents , and human resources training in the form of 
a technical customs course . Additionally, the DNA holds certification  under ISO Standard 
9001:200 8 on quality management systems : currentl y 24 offices, 1  customs sub -office and 
25 support areas have had processes certified.  
4.13.   As part of the Electronic Payment system provided for in the Agreement on Trade 
Facilitation, Electronic Payment for Certification of Origin was implemented through the Single 
Window for Exports ; this will produce  significant time and cost  savings . 
4.4  Trade facilitation  
4.14.   Paraguay attaches great importance to trade facilitation and as a result the negotiation and 
ratification of the trade facilitation agreement were a priority for the Government . We anticipate 
that the agreement will become a n effective  tool for reducing the additional costs of international 
trade and help to streamline and speed up the international transit of goods.  
4.15.   On 1 March  2016 Paraguay became the first MERCOSUR country to ratify the Agreement 
and on 27  April 2017 signed Decree No.  7.102, establishing the National Trade Facilitation 
Committee . The Committee is composed of various national institutions that are involved  in this 
area as well as representatives from the private sector, and its goal is to design and roll out a 
national strategic agenda based on implementing trade facilitation measures . 
4.16.   Additionally , the National Plan to Implement the Agreement on Trade Faci litation,  drawn up 
in conjunction with the International Trade Centre (ITC) and UNCTAD, sets out the needs and 
timeframes for  implement ing the A greement, for each of the various categories of measures.  
4.5  Agriculture  
4.17.   Since the last review, the Government has reformed the organizational and operational 
structure of the Ministry of Agriculture and Livestock (MAG) to strengthen its role and coordinate 
its action with that of institutions that perform  related functions . As part of this process, new 
institutions ha ve been established to deal with agricultural and forestry -related matters ; one of 
them is the National Agricultural and Forest Biosafety Commission (COMBIO), set up in 2012.  
4.18.   The Government has instituted a comprehensive policy plan to boost the agricultur e sector . 
The policies are part of the National Development Plan Paraguay 2030, the Agrarian Framework 
Strategy 2014 -2018, and the MAG Institutional Strategy Plan 2014 -2018.  
4.19.   Public participation in agriculture policy occurs through government service progr ammes 
that do not involve transfers or price support for producers . Instead they take the form of 
permitted domestic support (green box) in the area of general services, food security and aid 
programmes, structural adjustment assistance provided through in vestment aids and 
environmental programmes directed at small agricultural producers, in particular family farms and 
the most vulnerable farmers.  WT/TPR/G/360 • Paraguay  
 
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  4.20.   The country 's main crops in the current period by volume are soya beans  followed by maize 
(corn), wheat  and irr igated rice . The area under cultivation has also changed significantly . 
For example, between 2011 and 2016 the change in soya bean  production was from 2,805,466  ha 
to 3,540,000  ha; in maize from 853,592  ha to 960,000  ha; in irrigated rice from 78,606  ha 
to 130,000  ha; and in wheat  from 584,408  ha to 520,000  ha. The 2015/2016 season was marked 
by a moderate to strong El Niño effect , and the higher level of rainfall than normal,  especially in 
spring and summer, had  an impact on agricultural output . 
4.21.   Exports of  the main agricultural products account for 60 % the total for Paraguay led by 
soya beans  and by -products, which make Paraguay the fourth largest  soya exporter in the world, 
the sixth largest for maize and the tenth for wheat  (for which it is the only tropi cal exporting 
country) . Rice exports have grown significantly in recent years, wit h the figure for 2016 showing 
a 63% increase.  
4.6  Livestock  
4.22.   The livestock sector is very important to the Paraguayan economy because it encompasses 
not only beef cattle farming p er se, but also includes a pioneering industrial process that has made 
the sector one of the largest in the world . This buoyancy, especially where beef is concerned, is 
the result of work done by various governments in conjunction with the private sector.  
4.23.   Paraguay currently exports more than 450,000  tonnes  of meat products va lued at 
US$1,240  million (2016) . These figures make Paraguay the seventh largest exporter of frozen beef 
in the world and the fourteenth  largest for fresh or chilled  meat.  
4.24.   Although beef  is the main product in the meat sector, exports of pig meat and poultry meat 
also rose significantly during the period under review.  
4.25.   During  the 85th General  Session  of the World  Organization  for Animal  Health  (OIE)  in Paris,  
Paraguay  received  certificatio n recognizing  its status  as a foot-and-mouth -disease -free country,  
merging  the two FMD-disease -free areas  our country  previously  had, and for the first time, as a 
classical -swine -fever-free country , a status that it shares with 33  other countries . This mea ns that 
Paraguay now holds six of the seven health status certificates awarded by the OIE.  
4.7  Trade in services  
4.26.   The services sector is the main contributor to Paraguayan GDP, accounting for 43.9 % of the 
total in 2016 . During the period from 2010 to 2016, the largest subsector in terms of value added 
was commerce (14.5 % of GDP in 2016), followed by general government services (8.0 %). 
4.27.   The sector 's importance is also reflected in employment figu res, where it accounts for 
over 60% in the national economy . Commerce , restaurants and hotels are again  the largest 
subsector, accounting for 26.6 % of all employment, followed by community, social and personal 
services (24.5 %) and manufacturing, mining and quarrying (12.3 %). 
4.28.   Despite being the largest sector of the national economy, external trade in services still falls 
far short of  its potential . The balance of trade in services has recorded deficits every year . 
For 2016, it was US$221  million . The largest deficits are in transport, insurance, financial services 
and royalti es. The presentation  of the  balance -of-payments data and international investment  
position for the period under review is different from the previous reports because in 2012 the 
Binational Hydroelectric Enterprises were classified  for statistical purposes as resident enterprises 
of the Paraguayan economy, a change from the status of non -resident enterprises that obtained 
until 2011 . The changes were applied to the historical series of macroeconomic statistics.3 
4.8  Trade and environment  
4.29.   In order to promote sust ainable development and with a view to fulfilling the commitments 
entered into under the Kyoto Protocol on Climate Change, in particular with regard to emissions 
                                                
3 The Central Bank of Parag uay published an explanatory methodology paper at: 
https://www.bcp.gov.py/notas -tecnicas -y-metodologicas -i131. WT/TPR/G/360 • Paraguay  
 
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  limitation and reduction, Paraguay has implemented policies to enhance energy efficiency in th e 
relevant sectors of the national economy and has taken measures to limit and/or reduce emissions 
of greenhouse gases.  
4.30.   Accordingly, as part of the clean development mechanism provided for in the 
Kyoto  Protocol, the Government has designed a development po licy that is sustainable in 
environmental, economic and social terms, and that promotes the production and consumption of 
biofuels (ethanol and biodiesel).  
4.31.   As a result of implementing public policies that incentivize the efficient, economic and 
environment ally sustainable production of biofuels, sales of ethanol (obtained from sugar cane and 
grains) were 77 % higher in 2016 compared to 2011 . Where biodiesel is concerned, consumption 
was 146,883  litres in 2011 (obtained from vegetable a nd animal oil), and 10, 094,977  litres 
in 2016 (obtained solely from vegetable oil, resulting in better quality and higher demand).  
4.32.   Moreover, Paraguay has promulgated Law No.  4601/12, as amended by Law No.  5183/14, 
promoting the use of electric and hybrid vehicles through tax inc entives for imports ; there is 
currently pressure to broaden it to include tax incentives for imports of new and used vehicles up 
to two years old, and to require State bodies and entities to ensure that their new vehicle fleet s 
include at least 25 % electri c vehicles, preferably assembled in -country.  
4.33.   The National Energy Efficiency plan was launched  in 2014 ; its purpose is  to generate the 
general outline and approach to implementing immediate strategic measures on efficient energy 
use in various sectors as instruments that support sustainable national development.  
4.34.   Similarly MERCOSUR is developing an Energy Efficiency Labelling Scheme for Domestic 
Appliances with support from the German National Institute of Metrology . The aim is to enhance 
quality -assurance  infrastructure for evaluating  the energy capacity of domestic appliances and  to 
build consumer confidence by developing awareness around efficiency labelling . At national level 
the project is coordinated by the Ministry of Industry and Trade and involves the  institutions that 
are part of the National Quality System.  
4.35.   Finally, it should be noted that Paraguay was an active participant in the discussions leading 
up to the Paris Agreement on Climate Change (COP21) and hopes it will be fully implemented by 
the int ernational community.  
4.9  National energy policy  
4.36.   The National Energy Policy 2040 was approved on 10  October  2016 under Decree 
No. 6.092/2016 . Its strategic vision is "To cater for the energy needs of the people and all sectors 
of production based on criteria measuring quality, socio -environmental responsibility and efficiency 
since energy is a factor that drives economic growth, industrial development and social progress 
within the framework of regional integration ". That vision is to be achieved by reaching st rategic 
targets laid down for the National Energy Sector as a whole and separate targets for each of its 
subsectors : electricity, binational hydroelectric entities and electrical interconnection ; bioenergy 
and other alternative energy sources ; and hydrocar bons.  
4.37.   The Strategic Vision for Energy Policy lays down five core  strategic  targets that define the 
goal that its  effective implement ation and monitoring will achieve , as follows : (1) to guarantee 
energy security based on criteria for self -supply, efficienc y, affordability and socio -environmental 
responsibility to support the development of production in Paraguay ; (2) to provide access to 
high-quality energy for the entire population, with a specific focus on consumer rights ; (3) to use 
national sources of e nergy – hydroelectricity, bioenergy and other alternative sources, and to 
incentivize the production of hydrocarbons as strategic resources to reduce external dependence 
and increase generation of greater national added value ; (4) to enhance Paraguay 's pos ition as a 
hub for regional energy interconnection based on the sustainable exploitation of its natural 
resources and its strategic geographical location ; and (5) to encourage public understanding of the 
importance of energy and its sustainable use as a fa ctor in all -round development.  
4.38.   Decree No.  6092/2016 appoints the Secretary -General and Head of the Civil Section of the 
Office of the President of the Republic as Coordinator  of the Energy Policy of the Republic of WT/TPR/G/360 • Paraguay  
 
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  Paraguay , and the Under -Secretary for Min es and Energy as Executive Secretary for publicity and 
implementation  of the policy . 
4.10  Intellectual property  
4.39.   Since 2011 there have been a number of legislative develop ments that have allowed greater 
and more efficient regulation of patents for inventions, co pyright and related rights and 
trademarks . The legislative reforms were bolstered when in 2012 Law No.  4.798/12 established 
the National Intellectual Property Directorate (DINAPI), the body responsible for implementing 
national policy on intellectual prope rty and the administrative enforcement of the rules 
safeguarding intellectual property rights.  
4.40.   The adoption  of Law No.  4.923 of 20  June 2013 on Geographical Indications and 
Denominations of Origin  is likewise an important development . Prior to this legisla tion there was 
no specific law providing safeguards in this area , and accordingly DINAPI is pressing forward with 
draft regulations to facilitate implementation of the new rules.  
4.41.   Paraguay also ratified the Marrakesh Treaty to Facilitate Access to Published  Works for 
Persons Who Are Blind, Visually Impaired, or Otherwise Print  Disabled, which was adopted 
on 27 June 2013, and entered into force on 30  September  2016. The Protocol amending the TRIPS 
Agreement is expected to be ratified during 2017.  
4.42.   In 2015, Par aguay was removed from the Special 301 Watch List drawn up by the Office of 
the United States Trade Representative (USTR) pursuant to an Out -of-Cycle Review . This was 
regarded as a significant step forward, as reflected in the sign ing of a Memorandum of 
Understanding with the United States to improve protection for intellectual property rights.  
4.43.   As part of its public policy platform  the Gov ernment has enhanced protection  through the 
DINAPI under the National Intellectual Property Plan Paraguay 2030, approved  by Decree 
No. 7.132 of 1 8 May 2017, which acts as a roadmap to strengthen the intellectual property system 
and make it more effective as a smart tool for combating poverty and fostering economic, social 
and cultural development in Paraguay . The plan also has the overarching objective of consolidating 
the Intellectual Property system, both as a generator of value and as an aspect of the production 
sector, science, the arts and technology, thus building awareness of a country image associated 
with respect fo r intellectual property rights.  
4.11  Government procurement  
4.44.   In terms of regulation, with support from international bodies the G overnment has 
strengthened the legal framework of  government procurement, with the aim of implementing 
reforms to bring the national government procurement system into line with international 
standards on transparency, quality of management and environmental awareness . Additionally, 
support mechanisms for production, national employment and MSMEs  were implemented under 
existing legislat ion. The National Government Procurement Directorate is responsible for 
overseeing compliance with due process.  
4.45.   In this context, it should be noted that Law No.  5.074/2013 includes  the sovereign 
guarantee of the State in procurement funding for suppliers a nd Law No.  4.678/2013 lays down 
criteria for incorporating price adjustment formulae into public works contracts.  
4.46.   In 2016 government procureme nt in Paraguay amounted to US$2,466  million, equivalent 
to 9% of GDP . During the period under review, 54 % of this procurement was to purchase 
goods,  28% for public works and 18 % for payment for services rendered . On 
average  17,824  procurement processes are conducted in a year.  
4.47.   State -owned enterprises are the main contracting agencies, accounting for 88.7 % of the 
total value of government procurement between 2010 and 2016 . Chief among them are 
Paraguayan Petroleum (PETROPAR), the National Electricity Authority (ANDE), and the National 
Cement Industry (INC), followed by the Executive (8 %), public social security entities  (1.1%), 
departmental government s (1%), municipal authorities (0.6 %), autonomous decentralized entities 
(0.5%), the Judiciary (0.4 %) and joint ventures (0.2 %). WT/TPR/G/360 • Paraguay  
 
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  4.12  Protection of  competition  
4.48.   Law No.  4956/13 on the Protection of Competition was a major achieveme nt for the 
country . The law seeks to foster the greatest possible competition and ma rket openness and, by 
extension,  to enabl e businesses to produce more efficiently through use of competition to increase 
and improve the quality of their products to the be nefit of the end  consumer . The Law modernized 
Paraguay 's legislation in this area and brought it into line with the main legal systems of its 
regional neighbours and the world.  
4.49.   The National Competition Commission (CONACOM) operates as an autonomous, 
decent ralized body , linked  to the Government  through the Ministry of Industry and Trade . It 
comprises a board of three directors ; its executive arm, reporting to CONACOM, is the 
Investigations Directorate.  
4.50.   The Law applies to all acts, practices or arrangements b y legal or physical persons, whether 
Paraguayan nationals or foreigners, with a legal residence in Paraguay or abroad, whether 
governed by public or private law, or to any entities that perform economic activities, whether or 
not for gain, that affect comp etition throughout or in part of the national territory, except as 
provided for in law and duly justified on grounds of public interest ; it also applies to all practices 
and behaviour, whether by individuals or groups , that aim to or result in the restrict ion, limitation, 
hindrance, distortion or impediment to current or future competition in the market.  
4.13  Electronic commerce  
4.51.   Paraguay has beefed up its regulations on electronic commerce in order to help develop the 
sector . Worthy of note are Law No.  4017/2010  on the legal validity of electronic signatures, digital 
signatures, data messages and electronic files, as partially amended by Law No.  4610/2012.  
4.52.   It was against that background that Paraguay promulgated Law No.  4.868 on electronic 
commerce in 2013 , thus becoming  one of the first Latin American countries to have specific 
legislation on electronic commerce.  
4.53.   Through the Office of the Under -Secretary for Trade, the Ministry of Industry and Trade is 
the enforcement authority for the legislation in force on dig ital signatures and electronic 
commerce . To that end its organizational structure includes the Directorate -General of Digital 
Signatures and Electronic Commerce as the technical body responsible for the interpretation, 
application, oversight, evaluation  of and compliance with the legislation.  
4.54.   The prime objective is to work on amending the current rules to incorporate new trust 
services, regulate currently unregulated areas such as electronic claims so that Paraguay can 
achieve regulatory harmonization and a ddress legal and technological developments.  
4.55.   Nowadays electronic commerce in Paraguay has become a new channel for marketing and 
transacting goods and services . MSMEs  have increased their sales through online shopfronts, 
giving the sector an opportunity to  grow.  
4.56.   At the WTO Paraguay has been pushing forward various initiatives in electronic commerce, 
emphasizing the systemic importance of this type of trade to developing countries . Accordingly, 
Paraguay supports and contributes to discussions at multilateral  level to move ahead with the 
various proposals in this area.  
4.57.   As a landlocked developing country and a small and vulnerable economy, Paraguay is of the 
view that it is vital to have global, transparent rules on electronic commerce ; this would bring 
great b enefits, especially in respect of reducing legal and technological asymmetries, while also 
generating trust in this type of trade, and legal certainty in electronic data transmission services, 
thereby increasing cross -border trade and the supply  of profess ional services.  WT/TPR/G/360 • Paraguay  
 
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  4.14  Business climate  
4.58.   During the period under review, the Government of Paraguay has worked hard to improve 
the business climate, focusing on the free market and generating an investment -friendly 
environment . These efforts have been acknowledged  at various international forums.  
4.59.   Three new laws were introduced to improve the investment climate : (a) the public -private 
partnership  Law (Law No.  5.102/2013) ; (b) the investment protection Law (Law No.  5.542/2015) ; 
and (c) the Law on financed and turnkey  public w orks projects (Law No.  5.074/2013) . Also in force 
are a number of incentives to promote industry and innovation, including the raw materials 
regime, free zones, in-bond processing ( maquila ), and industrial estates.  
4.60.   During the period under review, cross-institutional work led to deeper conversations and a 
broader network of contacts among national and foreign private investors interested in investing 
in, finding out about and delivering projects, both on a private basis or in conjunction with the 
Government . Of particular note in that regard are the Economic and Trade Promotion Missions that 
gave presentations on Paraguay . Actions have also been taken to support various foreign trade 
missions to the country that have an interest in investing in and s eeking out commercial 
opportunities in sectors including agri -food, agro -industry, telecommunications, energy, finance, 
transport and external trade, textiles and made -up articles , chemicals and construction.  
4.61.   The Investment and Export Network (REDIEX), par t of the Ministry of Industry and Trade, is 
the body responsible for supporting Paraguayan exports through product and market 
diversification, expansion of exports, intersectoral work and fostering international competitiveness 
in the Paraguayan economy.  
4.62.   REDIEX operates through the creation of sectoral committees that link and promote export 
competitiveness and diversification while enhancing attractiveness to investment and the business 
climate . Public-private sectoral committees cover the following produc tion sectors : meat and 
leather ; fruit and vegetables ; forestry products ; textiles and made -up articles ; biofuels ; stevia 
(sweetener) ; pharmaceuticals ; maté; tourism ; and information t echnologies, T here is also  a 
committee that deals with the development of  new sectors (e.g. medicinal herbs, metalwork, 
automotive parts) . Additionally, three  cross-institutional committees  on logistics infrastructure, 
streamlining of procedures, and incentives for investment and exports , address how to improve 
the climate for investment . 
4.15  Infrastructure development and public works  
4.63.   The regulatory framework for finance d or turnkey public works projects (Law No.  5.074/13) 
also includes Decree No.  5.151/16 . The State lays down "boundary " finance terms concerning 
minimum term and ma ximum rate and does not make any payments until the work has been 
completed . The payments are backed by the Treasury once the works have been accepted and the 
contractor 's collection rights may be assigned in full or in part to the financial institution th at 
funded implementation . In May 2017 the Ministry of Public Works and Communication (MOPC) 
signed the first contract for the investment of US$45  million to tarmac 47  km of the 
San Cristóbal -Naranjal  Route  6 highway  in the department of Alto Paraná.  
4.64.   The regulatory framework governing p ublic-private p artnerships, comprising L aw 5.102/13 
(also known as the P PP law), which includes Regulatory Decree No.  1.350/14, has been in place 
for only three years . The institutions involved in delivering public -private par tnership projects have 
coordinated the processes needed for public international tendering for two major projects . One 
project, to widen National R outes 2 and 7, has already been signed and works will begin this year ; 
by contrast the project to modernize S ilvio Pettirossi airport is at the economic assessment stage.  
4.65.   The contract to design, finance, c onstruct, maintain and operate National R outes 2 and 7 
between the cities of Ypacaraí and Pastoreo will be the responsibility of a consortium of businesses 
from Spain, Portugal and Paraguay . The works are scheduled to last 30  months and the contract 
period is 30  years . Around 300,000  users a day will benefit from the road-widening scheme . The 
works will be delivered in a record time, within just three years of th e approval of the law . They 
involve an investment of US$507  million . The upgrade to two lanes concerns a 149  km stretch 
from Ypacaraí (Route  2) to Km  183 (Route  7), where the Tape Porã concession begins . The works WT/TPR/G/360 • Paraguay  
 
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  include five bypasses and three viaducts t o re-route traffic in the main urban areas . They will 
generate direct employment for around 2,500  workers and indirect employment for around 
7,500  people.  
4.16  Securities market  
4.66.   The securities market has been very buoyant in recent years ; in 2016 transactions w ere 
worth as much as US$591  million , a 23 % rise on 2015 . The securities marketable on the 
Paraguayan secur ities market include : (a) fixed -interest  securities such as corporate bonds (with 
and without guarantee), subordinated bonds, financial bonds, investm ent bonds, short -term 
exchange market bonds, national treasury bonds, municipal bonds , and credit instruments issued 
through trusts ; (b) variable -yield securities ; ordinary and preferential shares ; and (c) repurchase 
operations (Repos).  
4.67.   Approximately 48 % of the total amount traded  in 2016 was on the primary market and 52 % 
on the secondary market . Fixed-income securities  accounted for 90.9 % of the total, Repos 6.6 % 
and variable -income securities  2.5%. By currency, 60 % of transactions were in Paraguayan 
guara níes and 40 % in US dollars.  
4.68.   In 2017, the National Securities Commission held registrations for 143 agents ; 41 corporate 
open stock issuers ; 35 corporate issuers ; 6 risk rating agencies ; 1 stock market (Bolsa de Valores 
y Productos de Asunción, or BVPASA) ; 1 mutual fund management company ; 9 brokerage firms ; 
12 stock exchange operators ; and 38  external auditors.  
4.69.   The BVPASA  was established in 1977 . Law No.  94/91 established the legal framework 
required to begin exchange trading as well as the market regulator , the National Securities 
Commission . The first trades at BVPASA occurred in the year when the  Paraguayan securities 
market began trading,  1993, and involved nine corporate issuers.  
4.17  Support for small and medium -sized enterprises  
4.70.   In 2012 Law No.  4.457 estab lished the Office of the Under -Secretary for MSMEs . The Office 
reports to the Ministry of Industry and Trade . Its main tasks include coordination and delivery of 
supportive policy to strengthen and develop MSMEs , to foster their competitiveness, integrate 
them into the regional value chain, formalize them , and facilitate access to credit and guarantee 
funds.  
4.71.   In 2014 MERCOSUR  CMC Decision No. 39/14 was adopt ed establishing the MERCOSUR 
Guarantee Fund for Micro, Small and Medium -Sized Enterprises, a shared fu nd of approximately 
US$127  million that will reinforce the competitiveness and external integration of MSMEs of 
MERCOSUR member States . Paraguay is in the process of incorporating the Decision into domestic  
law and preparing its implementing  regulations . Paraguay is promoting the inclusion of a forum at 
the WTO to discuss matters that could encourage the participation of MSMEs  in international trade . 
Indeed, at the meeting of the General Council in May 2017, Paraguay introduced itself as a 
founder member of  the "Friends of MSMEs " at the WTO.  
4.72.   Additionally, as part of the Project to Improve Entrepreneurship in MSMEs , Loan Contract 
No 3354/OC -PR-3 has been implemented . It supports individual businesses with training, 
formalization procedures and technical assis tance for business management, and provides access 
to the financial system . At least 25 % of the beneficiaries must be women.  
4.73.   Also approved was Project 00101436 on Competitiveness for Microbusinesses (PCM), whose 
purposes, goals and approaches can be divide d into three strategies : (1) to promote 
competitiveness and innovation in business ; (2) to foster value chains and partnership ; and (3) to 
promote public -private partnership ; and into three main planks, namely up-to-date information, 
simplified procedures , and transparent oversight.  
4.74.   We should also note the Project to Strengthen and Develop Micro -businesspeople - FDM, 
which will involve 20  micro -entrepreneurs selected in the "Con vos Paraguay crece " contest on the 
basis of the ir plans for sustainable busines ses. The emphasis will be on innovative projects to WT/TPR/G/360 • Paraguay  
 
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  produce goods and services with a gender -based approach in peri -urban areas where at least 25 % 
of the beneficiaries must be women.  
4.18  Women and trade  
4.75.   In recent years the National Government has worked hard t o increase the economic 
empowerment of women by implementing gender -aware public policies across a number of areas 
with the aim of ensuring fairness  and the economic inclusion of women into chains of production.  
4.76.   Where the institutional framework is concern ed, of note are the actions led by the Ministry 
for Women, a body established under Law No.  4.675 of 26  March  2012, in conjunction and 
cooperation with the leading players from central government and the private sector . The major 
actions consist in facilit ating access to credit for business undertakings ; driving strategies to give 
rural women a place in value chains and domestic markets ; and providing guidance to them to 
compete in regional and international markets (Law No.  5.446/2015).  
4.77.   Paraguay has reques ted support from the International Trade Centre to deliver a 
programme in -country  to strengthen women 's participation in international trade.  
 WT/TPR/G/360 • Paraguay  
 
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  5  CONCLUSIONS AND DIRECTIONS OF FUTURE POLICY  
5.1.  The three main planks of the National Development Plan Paraguay 2030  focus the 
Government 's efforts on designing and implementing an economic policy that aims to achieve 
inclusive, environmentally friendly growth featuring innovation and technological development.  
5.2.  Evidence of this is clear from the major advance s brought a bout in the institutional and 
regulatory framework of Paraguay, and in the various pieces of legislation introduced in recent 
years such as the laws on transparency, public -private partnerships, protection of competition, 
electronic commerce, and support f or MSMEs . 
5.3.  Similarly , along with other changes yet to be implemented, it is hoped that these reforms will 
help to promote structural change in the Paraguayan economy by expanding production, 
expanding exports, and adding greater value to products while embe dding Paraguayan businesses 
into regional and global value chains.  
5.4.  Accordingly, the National Government 's priority is to continue to grow public investment and 
improve the business climate to create conditions conducive to innovation and entrepreneurship 
where there is free movement of capital.  
5.5.  The aim of the policy instruments used by Paraguay is to generate trade flows through 
transparent, non -discriminatory rules . Accordingly, Paraguay reaffirms its commitment to the 
multilateral trading system and its a ctive participation in the negotiations conducted at the WTO.  
5.6.  Additionally, Paraguay will continue to move towards deeper regional integration and will also 
seek to expand its trade relations with other countries  in order to increase its access to new 
markets and pursue its aim to be an economy that is open to the world.  
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