Paraguay’s Maquila Sector Sets New Export and Employment Records

August 2025 marked a landmark month for Paraguay’s maquila regime, as the Ministry of Industry and Commerce reported exports reaching US$127 million and year-to-date sales surpassing US$801 million.

Maquila firms manufacture and assemble goods for export under preferential tax rules. This surge drove exports up by US$83 million compared to January–August 2024 and added 6 688 jobs over the past year.

The maquila industry now employs 34 799 people, a 24 percent increase from August 2024. Employers hired 411 new workers in August alone, underscoring sustained workforce growth. These jobs offer stable incomes in regions that depend on manufacturing.

Five product lines generated three-quarters of maquila exports. Auto parts led with 34 percent, followed by garments and textiles at 17 percent. Aluminum products (13 percent), food items (11 percent), and plastics with derivatives (7 percent) also drove performance.

This concentration reflects Paraguay’s growing role in regional supply chains. Geographically, maquila companies cluster in Alto Paraná (47 percent), Central (29 percent), Asunción (9 percent), and Amambay (6 percent).

These four departments host 91 percent of all maquila operations. Alto Paraná’s proximity to Brazil and access to transport corridors explain its dominance.

Mercosur remains the main market, absorbing 82 percent of shipments. Brazil alone takes 64 percent, while Argentina accounts for 15 percent. Beyond the bloc, the Netherlands and the United States each receive 4 percent of maquila exports.

Chile and Bolivia import 3 percent apiece, and Uruguay imports 2 percent. This regional focus benefits from trade agreements and logistical links.

Export growth highlights the regime’s role in diversifying Paraguay’s economy beyond agriculture and raw materials. By adding value through manufacturing, maquila firms attract foreign investment and transfer technical skills.

Stable employment in this sector supports household incomes and broader economic stability. However, reliance on Mercosur markets presents risks if regional demand falters.

Diversifying export destinations and product ranges could mitigate potential shocks. Government incentives and infrastructure improvements may encourage maquila firms to explore new markets and technologies.

Overall, maquila’s record performance in August demonstrates its critical contribution to export revenues and job creation. Continued expansion in key regions and product categories underlines Paraguay’s potential as a competitive manufacturing hub in South America.

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