The strong depreciation of the dollar against the guarani continues to pressure Paraguayan companies, especially those that receive dollars but bear costs in local currency. The Minister of Industry and Commerce (MIC), Marcos Riquelme, admitted that the falling exchange rate is reducing the competitiveness of national products in the external market.
At the opening this Monday, the dollar was traded at G. 6,120 in the effective exchange and G. 6,096 in the interbank market, accumulating a depreciation of approximately 25% against the guarani in the last 12 months – a loss of almost G. 2,000 per dollar.
“Exporters, such as those of bananas, fruits and vegetables, industries that export, maquiladoras and similar are suffering greatly from this impact. Although they try to compensate costs to maintain prices, we know it is complicated,” Riquelme stated. According to him, the impossibility of sustaining prices ends up affecting the competitiveness of Paraguayan products compared to those from other markets.
Data from the Monthly Indicator of Economic Activity (Imaep) showed a growth of 7.3% in industrial activity in March, with an accumulated increase of 3.2% in the first quarter. Despite the increase in production, the sector laments that exchange rate effects are eroding important margins.
The minister detailed that industries continue to grow due to commitments with clients that absorb all production, and that there is no risk of shortages. “Maquiladoras will not close, but they are losing a lot of margin because of an exchange rate that has fallen abruptly,” he reiterated.
Regarding the impact on the basic basket, a topic on which President Santiago Peña complained that the dollar's fall is not being reflected in consumer prices, Riquelme stated that 75% of essential items are of national production and would have no direct relation to the exchange rate. However, he acknowledged that the country is importing inflation from products coming from Brazil, where the real has also appreciated about 10%.