RIO DE JANEIRO, BRAZIL – According to the Latin American Economic Survey, conducted by the Brazilian Getulio Vargas Foundation’s Institute of Economics, Paraguay closed the fourth quarter 2021 with a score of 133.3 in the Economic Climate Indicator, while the region averaged 80.6.
Countries such as Brazil and Argentina experienced a significant decline in their figures, closing the year with scores of 63.4 and 37.2 respectively.
Along with Paraguay, Colombia was among the best performers, rising from 104.4 points in the third quarter of 2021 to 137.6 in the last quarter of the year, as well as Uruguay, Ecuador and Bolivia, which also managed to improve their scores, closing the year with 119.7, 117.5 and 87.3 points, respectively.
Among the countries that experienced more significant drops in their rating is Brazil, falling from 118.5 to 63.4 between the third and fourth quarters, and Chile, which dropped from 104.4 to 80.1 in the same period.
“Paraguay has some more favorable conditions than other countries. It has better expectations in economic policy, a favorable climate for foreign investment, better legal and administrative incentives, and greater credibility in Central Bank policy,” explains the Investment and Export Network’s head of the Business Climate Observatory Tatiana Lopez.
THE BEST IN THE PAST DECADE
Lopez pointed out that the Getulio Vargas Foundation study shows that Paraguay maintains a leading position in this indicator with respect to other Latin American countries. In fact, when looking at the average of the past decade, in the Business Climate Indicator Paraguay is positioned ahead with 117.1 points, followed by Peru with 110.5 points and Colombia with 103.8 points.
Among the factors behind this positive ranking, she mentioned the country’s credibility in terms of economic policy, inflation and exchange rate stability, which offers security to local and foreign investors, and the high rate of profitability.
Lopez said that just as the country has its positive side, it also has significant challenges to face, such as increasing its investments in research and innovation, infrastructure, reducing income inequality, corruption, improving the qualification of its labor force, and enhancing its international competitiveness.
She added that the Investment and Export Network’s (REDIEX) efforts must be continued to ensure that entrepreneurs may process their investments in a much faster and simpler way.
“We have worked on numerous projects together with the Ministry of Technology and Information, the portfolio dedicated to facilitating IT and electronic aspects, to support us so that these procedures undertaken by entrepreneurs may be facilitated through electronic systems,” she said.
Lopez said that another point that must be worked on is e-commerce. “Although e-commerce has expanded in the country during the pandemic, we believe that it should be developed from abroad”, she said.
She concluded by saying that the largest foreign investors in Paraguay are from the United States, Spain and Brazil.