The Assunción City Hall is facing a severe financial crisis related to stormwater drainage works in the Santo Domingo, Manorá, and San Pablo neighborhoods. Originally funded by a debt bond known as bono G8, amounting to 360 billion guaraníes, these funds were diverted to pay salaries, according to an intervention report conducted in 2025 by Carlos Pereira.
Due to this diversion, the current administration under Luis Bello has been covering payments to contractors using municipal revenue, meaning that the taxpayers of the Paraguayan capital will end up paying three times for the same service. Councilman Álvaro Grau explained that citizens will have to pay the bond principal, the corresponding interest, and the cost of the works again, totaling about 1.6 trillion guaraníes, double the initially projected amount.
The works, which began more than two years ago, are still incomplete and have already caused losses to local merchants, especially on Epifanio Méndez Fleitas Street, due to the prolonged period of interventions. Additionally, there are records of payments made for a project that never started in the Las Mercedes neighborhood, raising suspicions about the management of the funds.
So far, the City Hall has paid over 20 billion guaraníes to various companies responsible for the work, including Consórcio Pluvial Abasto, Consórcio Pluvial Santos, Consórcio CCC-Tecsul, and Teco S.R.L. The city’s total debt with bonds G5, G6, G7, G8, and G9, including principal and interest, reaches approximately 1.46 trillion guaraníes (about 237 million dollars), with payments scheduled through 2035.
Furthermore, the City Hall has accumulated 14 overdue interest installments on these bonds, totaling around 145 billion guaraníes. The situation is under investigation by the Prosecutor’s Office, which has received information from the municipal intervention to determine the whereabouts of the 500 billion guaraníes that were diverted. Councilman Álvaro Grau stressed the importance of identifying and holding those responsible accountable.