The Asunción Stock Exchange (Bvpasa) is in the final stages of negotiations with the Central Bank of Paraguay (BCP) to allow the trading of currency futures (forwards) on the stock market. The initiative, announced by Bvpasa President Pablo Cheng, aims to provide importing and exporting companies with a currency hedging tool that reduces the impact of dollar volatility.
“These instruments are currently channeled mainly through the banking system, but we want them to also be traded on the exchange,” Cheng explained. He stressed that the dollar fluctuation has a direct impact on the economy and that sectors need to protect themselves with adequate financial systems. “The forward will avoid ‘that headache’ that the exchange rate difference causes,” he added.
In addition to forwards, Cheng highlighted that instruments in guaranis are gaining attractiveness in the local market, with interesting rates for both investors and issuers. Although operations in the Paraguayan currency predominate, the exchange also trades in foreign currency.
Another topic addressed was the Investor Pass program, which allows foreigners to obtain permanent residency in Paraguay through a direct investment of US$ 200,000 in real estate or on the stock exchange, without requiring job creation. For the tourism sector, the minimum amount is US$ 150,000. “The Investor Pass will provide liquidity to the capital market and allow the creation of more products,” Cheng stated. He reported that some brokerage firms are already receiving inquiries from interested investors.
Cheng compared Paraguay to Uruguay as destinations that spark interest among people seeking tax residency and tax opportunities. “The Investor Pass will be an opportunity to acquire permanent residency directly,” he concluded.