Ministerio de Economía y Finanzas

Experts project that Paraguay's chronic fiscal crisis, characterized by low revenue and growing debt, will force a drastic reduction in public investment in the 2027 budget.

The Asunción Stock Exchange (BVA) projects a new historic record for operations in 2026, with the expectation that the National Treasury will resume issuing public bonds through the exchange starting in July. This follows a two-year period during which issuances were made exclusively by the Central Bank.

The National Single Registry (RUN) has begun requiring georeferenced plans in property titles to combat real estate fraud and strengthen legal security, in accordance with Law 7424/25 regulated by President Santiago Peña.

President Santiago Peña has fully vetoed a bill that would have exempted firefighting vehicles from taxes, citing regulatory redundancy, technical flaws, and budgetary impacts.

The Paraguayan government has reallocated more than US$284 million in its 2026 budget, with increases primarily directed toward health, public works, educational institutions, and other state bodies.

A 32-year study in Paraguay has demonstrated that no-till farming combined with crop rotation significantly increases soil biological activity and nutrients.

Paraguay faces a fiscal deficit above the legal target of 1.5% of GDP, pressured by pending debts and reduced revenues, while the IMF insists on strict compliance with the Fiscal Responsibility Law.

Paraguay's public debt reached US$21.8 billion in May, a 6.5% increase in absolute value over five months, but the debt-to-GDP ratio fell to 36.2% due to the appreciation of the guarani and growth in GDP projections.

Paraguay is negotiating over $1.6 billion in external credit by 2026 for infrastructure projects, including connectivity, sanitation, and energy, with some funds already under management and others awaiting legislative approval.

Spending on salaries in Paraguay's Central Administration grew 8.3% through May 2026 and now accounts for 53% of tax revenue, while tax collections rose just 1.2%, prompting the government to announce austerity measures.

Senator Juan Afara proposed in the Senate the issuance of $304 million in government bonds to guarantee the purchase of medicines and medical supplies for the IPS.

Patients with rare and chronic diseases in Paraguay have been without essential medications for eight months due to a lack of Budget Availability Certificates, and the Paraguayan Federation of Patients with Rare Diseases (FEPPER) accuses the government, including President Santiago Peña and Economy Minister Óscar Lovera, of failing to respond to requests, while current tenders cover only 70 of the more than 350 patients in need.

The House of Representatives postponed for 15 days the analysis of a bill that provides for the payment of default interest to construction companies for halted public works, after lawmakers raised concerns about legal issues and the high fiscal cost.

Economists assessed that the austerity measures announced by the Ministry of Economy and Finance (MEF) will have a marginal impact on Paraguay's public accounts and do not address the structural problems of the fiscal deficit.

Paraguay's public debt hit a record $21.781 billion in April 2026, up 6.5% from December 2025, with more than 84% concentrated in external debt, while the government says the debt-to-GDP ratio remains around 36.2%, although economists warn of the risks posed by the continued growth of financial commitments.

Economist Luis Rojas criticized the economic model of Santiago Peña’s government in Paraguay, highlighting contradictions between the growth rhetoric and fiscal challenges, such as the public debt reaching a historic level of USD 21.7812 billion in the first four months of 2026, representing 36.2% of GDP, along with low tax revenue, poor public services, labor informality, and foreign direct investment of only USD 400 million in 2024.

The Paraguayan government has created a working group led by Deputy Minister of Industry Javier Viveros, with representatives from various financial and government institutions, to streamline the process of opening bank accounts by foreign investors following complaints about excessive bureaucracy, with a 60-day deadline to present a concrete proposal.

The Paraguayan government's debt to construction companies remains at US$300 million despite payments made in April and May, according to Capaco, which rejected the factoring system proposed by the Ministry of Economy and Finance (MEF), considering it unfeasible due to the high interest rates charged by financial institutions.

Itaipú transfers to Paraguay fell 12.53% in the first five months of 2026 compared with the same period in 2025, totaling $205,265,900, with the steepest drop in the Energy Cession Compensation, which declined 34.15%, while royalties fell 1.13% and benefits to ANDE rose 1.51%.

Óscar Lovera, Minister of Economy and Finance, confirmed a payment of US$80 million to pharmaceutical suppliers as part of a plan to reduce a total debt of about US$1 billion. He also announced a new Treasury-backed factoring mechanism with the Central Bank of Paraguay that will allow suppliers to assign receivables to banks and receive immediate liquidity, with payment terms extended up to 36 months.

The government of Paraguay published Decree No. 6120, signed by President Santiago Peña and Minister of Economy and Finance Óscar Lovera, establishing austerity measures to optimize, prioritize, and efficiently manage public spending in the 2026 National Budget, prioritizing expenditures on health, education, security, and social programs, while imposing restrictions on operational spending and non-essential procurement.

Analyst Wildo González, criticizes the monetary policy of the Central Bank of Paraguay, arguing that the current low inflation is the result of currency appreciation and liquidity tightening, not lasting success. He warns of future risks with the reversal of capital flows.

Official spreadsheets from the Ministry of Economy and Finance (MEF) reveal that Ueno Bank, linked to former partners of President Santiago Peña, increased its state deposits in foreign currency by more than US$102 million between December 2025 and April 2026, taking advantage of the dollar's depreciation on the local market. The funds include resources from the Social Security Institute (IPS).

Data from the Ministry of Economy and Finance show that civil servant remuneration consumed G. 7.9 trillion in the first four months of 2026, driven by strategic sectors. In contrast, transfers for works and infrastructure fell to G. 1.1 trillion, with a sharp decline in public credit resources.