China's growing influence in Paraguay extends beyond traditional diplomacy and has focused on the private sector, a move that productive sectors and experts already describe as domestic economic pressure to force a shift in diplomatic relations from Taiwan to Beijing.
Although Paraguay recognizes Taiwan as the legitimate "Republic of China," the country is practically not exporting directly to the Chinese market. Economist Ariel Slipak explains that Paraguayan products highly sought after by China — such as soybeans, soybean oil, beef, and some types of corn — end up being denied direct access in retaliation for Paraguay's foreign policy.
International Relations expert Julieta Heduvan details that China is already Paraguay's main supplier, with imports exceeding $4.33 billion. A considerable share of Paraguayan exports ends up reaching China through trade routed through third countries, driving up costs. Since China and Taiwan both joined the World Trade Organization in 2001, there have been no formal regulatory barriers to bilateral trade; the restriction is seen as a deliberate political tool by Beijing to pressure Taiwan's allies.
In 2024, President Santiago Peña stated that Paraguay sells soybeans to China despite maintaining relations with Taiwan. Chinese Foreign Ministry spokesperson Lin Jian categorically denied the claim and said that Chinese statistics record zero soybean purchases from Paraguay. "If the Paraguayan government wants to seek development and the well-being of its people, it should be aware of the trend and position itself on the right side of history, instead of trying to game the system," he declared.
On the agricultural sector's side, exclusion from the Chinese market is treated as urgent. Pedro Galli, a representative of the Paraguayan Rural Association (ARP), says the country is shut out of the world's largest market and describes the situation as "a significant competitive disadvantage." He acknowledges the growth of destinations such as Taiwan and the United States but argues that new markets do not preclude opening up to China. Galli states that, institutionally, there is no Chinese diplomatic outreach but acknowledges private and unofficial contacts, though he assesses that the private sector has no direct influence to shift political decisions.
The business sector is also applying pressure. Businessman Iván Dumot, president of the Paraguayan Importers Center, highlights that 36% of Paraguayan imports come from China, making this market vital for the sector. He argues that, while respecting political decisions and the benefits of Taiwan, Paraguay needs to unlock formal trade relations and establish, at a minimum, a Chinese consular office in the country.
The discussion exposes an internal divide: while agricultural producers and importers see China as an unavoidable opportunity, industrial sectors and experts warn of risks involving billions in losses, a shift back toward commodity-dependent exports, and a process they consider difficult to reverse in Paraguay's productive structure.