At a meeting in Asunción, officials and business representatives discussed quota allocation and preparations for access to the European market. Infrastructure, certification, logistics and firms’ ability to adapt remain challenges.
Mercosur
MERCOSUR is a regional integration process founded in 1991 by Paraguay, Argentina, Brazil and Uruguay. For Paraguay it shapes tariffs, rules of origin, trade flows and many external economic negotiations, while its institutions also reach beyond trade into broader regional cooperation. This dossier gathers Pytagua coverage of how bloc decisions and agreements affect Paraguayan exports, imports, the maquila sector, border economies and negotiations with external partners such as the European Union.
The Paraguayan passport fell from 49th to 53rd place and from 144 to 141 accessible destinations in 2026, still equivalent to 71.2% of the destinations assessed, although prior visa requirements remain across large areas of Africa, Asia and Oceania.
Paraguayan exports under the maquila regime totaled $1.01 billion from January to August 2026, up 26% in one year, with a positive trade balance of $481 million, driven by auto parts, garments, beverages and aluminum manufactures, mainly for Mercosur.
The suspension of Brazilian beef exports to the European Union could redirect Brazil’s supply and increase competition for Paraguay in Chile and the United States, while Mercosur discusses how to divide a potential European quota.
The European Union and Paraguay agreed to expand cooperation against transnational organized crime and advocated moving ahead with implementation of the trade agreement between Mercosur and the EU.
In Brussels, Foreign Minister Rubén Ramírez Lezcano advocated expanding cooperation between Paraguay and the European Union into a strategic partnership covering security, the fight against organized crime, investment and development, with the Mercosur–EU agreement as a foundation, according to the position he presented.
Paraguay reiterated its proposal to divide export quotas for the European Union equally among Mercosur’s four countries, but Argentina, Brazil and Uruguay have yet to reach consensus and will discuss the issue again within 60 days.
Paraguay plans to install a nitrogen fertilizer plant in Carmelo Peralta, initially supplied with Argentine gas from Vaca Muerta and later with gas from the Paraguayan Chaco, mainly serving Mato Grosso and Mato Grosso do Sul through the Bioceanic Route and the Paraná-Paraguay Waterway.
The European Union’s two-year sanitary suspension of Brazilian beef could increase Paraguay’s presence in the European market, while also intensifying Brazilian competition in Chile and other regional destinations.
Mercosur held the first round of talks with Vietnam in Buenos Aires on a preferential trade agreement aimed at expanding market access, diversifying exports and fostering investment.
The Mercosur-EU agreement could expand Paraguayan exports and attract investment, especially in agriculture, forestry and renewable energy, but it will require certification, audits and traceability to meet European standards.
The price of Paraguayan beef reached a historic record as the United States suspends import tariffs for ground beef, creating a strategic opportunity for the country's exports.
Mercosur has not yet reached a consensus on the allocation of export quotas provided for in the agreement with the European Union, with Paraguay advocating for an equitable distribution of 25% for each bloc member.
The German ambassador to Paraguay, Gordon Kricke, stated that there is growing interest from German companies in investing in the country, especially in the green energy, agribusiness, and maquila sectors, driven by local stability and the Mercosur-European Union agreement.
Lula's statements on the War of the Triple Alliance, justifying the military budget, reignite crisis with Paraguay, which had already suspended Itaipú negotiations and recalled its ambassador in 2025, amid tensions over Brazilian intervention in Uruguay and 19th-century territorial annexation.
Paraguayan President Santiago Peña has enacted the law approving the Mercosur agreement to provide consular assistance to citizens in countries where their nation lacks representation.
A delegation of business leaders from Santa Catarina and Rio Grande do Sul is in Asunción to explore investment opportunities in Paraguay, facilitated by the Paraguay-Brazil Chamber of Commerce (CCPB) and hosted by the Paraguayan Industrial Union (UIP).
Paraguay's maquila export regime grew by 25% in the first half of 2026, reaching $717 million, with the Mercosur trade bloc as its main destination and a 6% increase in jobs.
Spanish Ambassador Javier Parrondo highlighted the 150,000 Paraguayans residing in Spain and projected that the trade agreement between the European Union (EU) and Mercosur will significantly boost bilateral economic relations.
Paraguayan authorities are assessing the impact of the provisional application of the EU-Mercosur agreement, which creates a free trade zone after more than 25 years of negotiations, as they await the final ratification of the political component by the European Parliament.
The Paraguayan finished-cattle market is maintaining stable prices despite downward pressure in Brazil, with limited supply and solid international demand. The source report says Paraguay again set a record for average beef export value in June, which it says supported prices for export cattle.
Paraguay has launched the Validador PY platform to verify digital documents across the Mercosur trade bloc, along with a new version of its service provider registry, Repse 2.0, aiming to reduce bureaucracy and combat informality.
Paraguayan President Santiago Peña reaffirmed his country's alignment with the United States and Taiwan and declared that he will not yield to pressure from China to establish a formal negotiation channel with Mercosur, linking the Chinese pressure to the recent 5G network tender.
Taiwan was the primary destination, purchasing 86% of the pork exported by Paraguay in the first half of the year, which saw an 11% growth in volume and a 15% increase in revenue.