Paraguay is one of the best countries to invest in Latin America in terms of the ease of launching a business and the growing opportunities available in the country, according to Inter-American Development Bank (IDB) President Mauricio Claver-Carone.
“If I were a foreign company, one of my first destinations would be Paraguay, due to the current investment environment that is ideal for doing business,” Claver-Carone was reported as saying during a meeting with Paraguayan President Mario Abdo Benítez and various ministers from his government on September 13.
In that meeting Claver-Carone also lauded Paraguay’s ability to increase foreign direct investment (FDI) during the pandemic, bucking the regional trend.
“That Paraguay is one of the five countries in Latin America and the Caribbean that have increased foreign investment during the pandemic in 2020 despite a regional drop of almost 40% in foreign investment is a milestone that must be known ” he reportedly told the media after the meeting.
According to Claver-Carone, Paraguay’s stable politics and significant human capital — including one of the youngest workforces in the region — combine to mean that “all the chips for success are on the table,” reinforcing the country’s status as one of the best countries to invest in Latin America.
The IDB president also highlighted Paraguay’s status as a regional leader in renewable energy — a sector of growing importance as economies seek to develop more sustainable futures.
Pandemic policies make Paraguay one of best countries to invest in Latin America
Since the onset of the global COVID-19 pandemic in the early months of 2020, Paraguay has introduced a number of policies that have helped to attract FDI and make it one of the best countries to invest in Latin America.
In the latter part of 2020, the government announced that it would be streamlining the residency process for foreign investors, as well as promoting the country’s low-tax regime and long term stability, in order to stimulate greater investment.
“Here there is no history of confiscations or changes to the rules for investment,” said then-Finance Minister Benigno López when announcing the initiative.
Meanwhile, in January 2021, the government issued a decree to consolidate regulations for transfer pricing in Paraguay which had been first introduced in 2019 in order to bring the country in line with standards established by the Organisation for Economic Co-operation and Development (OECD).
Known as the “good practice club,” the OECD is known for its stringent demands for democratic and free market trade practices that inspire investor confidence.
As well as its political stability and significant human capital, Paraguay boasts a number of strong investment opportunities beyond renewable energy that help to make it one of the best countries to invest in Latin America.
These are in addition to a well-established agricultural sector. Soybeans are used mainly for animal feed and meat, as well as large oil and gas reserves.
Paraguay is also in negotiations with Chile for its first bilateral free trade agreement (FTA) — which promises to create significant opportunities for investors.
That will add to the free trade access it enjoys to key markets through its membership of the Southern Common Market (Mercosur) — a 30-year old economic integration initiative that also includes Argentina, Brazil, and Uruguay.
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