Given the Government of Paraguay's dependence on import duties for revenue, the collapse of the trade could have serious macro-economic and fiscal consequences. The principal areas for growth in the near future reflect the country's immediate need to improve its infrastructure and become more competitive in Mercosur. The Paraguayan government continues to be the primary actor in the economy. Reform efforts, including privatization, are effectively on hold until after the 1998 elections. Infrastructure Paraguay's poor infrastructure is a key obstacle to growth.
Telecommunications is the key sector for investment in the country.
Paraguay's telecommunications is the worst in Mercosur. There are 3 phone lines per 100 inhabitants, and an estimated demand of almost 1 million lines. Paraguay is the lowest cost provider of electricity in Mercosur.