Overview: The economy is predominantly agricultural. Agriculture, including forestry, accounts for about 25% of GNP, employs about 45% of the labor force, and provides the bulk of exports. Paraguay has no known significant mineral or petroleum resources, but does have a large hydropower potential. Since 1981 economic performance has declined compared with the boom period of 1976-81, when real GDP grew at an average annual rate of nearly 11%. During 1982-86 real GDP fell three out of five years, inflation jumped to an annual rate of 32%, and foreign debt rose. Factors responsible for the erratic behavior of the economy were the completion of the Itaipu hydroelectric dam, bad weather for crops, and weak international commodity prices for agricultural exports. In 1987 the economy experienced a modest recovery because of improved weather conditions and stronger international prices for key agricultural exports. The recovery continued through 1988, with a bumper soybean crop and record cotton production. The government, however, must follow through on promises of reforms needed to deal with large fiscal deficits, growing debt arrearages, and falling reserves.

GDP: $8.9 billion, per capita $1,970; real growth rate 5.2% (1989 est.)

Inflation rate (consumer prices): 30% (1989 est.)

Unemployment rate: 12% (1989 est.)

Budget: revenues $609 million; expenditures $909 million, including capital expenditures of $401 million (1988)

Exports: $1,020 million (registered f.o.b., 1989 est.); commodities--cotton, soybean, timber, vegetable oils, coffee, tung oil, meat products; partners--EC 37%, Brazil 25%, Argentina 10%, Chile 6%, US 6%

Imports: $1,010 million (registered c.i.f., 1989 est.); commodities--capital goods 35%, consumer goods 20%, fuels and lubricants 19%, raw materials 16%, foodstuffs, beverages, and tobacco 10%; partners--Brazil 30%, EC 20%, US 18%, Argentina 8%, Japan 7%

External debt: $2.9 billion (1989 est.)

Industrial production: growth rate 2% (1987)

Electricity: 5,169,000 kW capacity; 15,140 million kWh produced, 3,350 kWh per capita (1989)

Industries: meat packing, oilseed crushing, milling, brewing, textiles, other light consumer goods, cement, construction

Agriculture: accounts for 25% of GDP and 50% of labor force; cash crops--cotton, sugarcane; other crops--corn, wheat, tobacco, soybeans, cassava, fruits, and vegetables; animal products--beef, pork, eggs, milk; surplus producer of timber; self-sufficient in most foods

Illicit drugs: illicit producer of cannabis for the international drug trade with an estimated 300 hectares cultivated in 1988; important transshipment point for Bolivian cocaine headed for the US and Europe

Aid: US commitments, including Ex-Im (FY70-88), $168 million; Western (non-US) countries, ODA and OOF bilateral commitments (1970-87), $994 million

Currency: guarani (plural--guaranies); 1 guarani (G) = 100 centimos

Exchange rates: guaranies (G) per US$1--1,200.20 (November 1989; floated in February 1989), 550.00 (fixed rate 1986-February 1989), 339.17 (1986), 306.67 (1985)

Fiscal year: calendar year

NOTE: The information regarding Paraguay on this page is re-published from the 1990 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Paraguay Economy 1990 information contained here. All suggestions for corrections of any errors about Paraguay Economy 1990 should be addressed to the CIA.