Paraguay continues to expand the use of government bonds as a central tool to finance public works and state investments. The so-called Treasury bonds are issued both domestically and abroad and serve not only to raise funds but also to manage the public debt profile, allowing the refinancing of maturing obligations under more favorable conditions.
International bonds are issued under the laws of the state of New York and subject to that jurisdiction, while local issuances follow Paraguayan law and are registered with the Securities Superintendency. A key factor in the cost of this financing is the country's perceived risk: the higher the risk perceived by rating agencies, the higher the interest rates demanded by investors.
In this regard, Paraguay has achieved investment-grade status with two of the three major international rating agencies, enabling it to secure funding at lower interest rates and longer maturities. In Latin America, the country is among those paying the lowest rates, alongside Chile and Uruguay, a direct reflection of the improvement in its sovereign credit rating.
Under Law No. 7609/2025, which authorized borrowing of USD 661.6 million for 2026, USD 294.1 million has already been placed on the international market (44.5%) and USD 68.5 million on the domestic market (10.4%). The remaining balance stands at USD 298.9 million, of which USD 123.6 million is earmarked for domestic issuances.
The Vice Ministry of Economy reported that four local issuances are still scheduled between June and October, all in guaraníes, under the I-2026 Program. The first auction of the year took place in April, with a reopening of a bond maturing in 2035, and saw strong demand: bids totaling G. 698 billion were received, and the full available amount was awarded.
In upcoming placements, in addition to the bond maturing in 2035, the government will offer short-term reopenings with maturities in 2028 and 2030, with the aim of strengthening the secondary market and extending the yield curve. Deputy Minister of Economy and Planning Gerardo Ruiz Díaz stated that the outlook is positive, with sufficient market liquidity and investor interest.
Noteworthy is the growing appetite of foreign investors for local-currency bonds: over the past 12 months, the average share of non-resident holders reached 5.21% of total outstanding Treasury bonds. Should demand exceed the initially authorized volume, the government will consider expanding the program, taking advantage of the remaining parliamentary margin of USD 175.3 million.
Ruiz Díaz stressed that, unlike previous issuances, the proceeds from upcoming auctions will have a specific purpose. Under Law No. 7609/2025, all funds raised will be allocated to financing investments, with no provision for debt refinancing operations, and the funds will be channeled exclusively toward public investment projects included in the National General Budget.