Paraguay’s economy remains heavily concentrated in a few regions, with five areas accounting for most of the country’s formal employment, production, and business development, according to economist and researcher Belén Servín from the Center for Analysis and Dissemination of the Paraguayan Economy (Cadep).
During the panel "The State of the Economy and Economic Development in Paraguay," held as part of the congress "35 Years of Democracy: Economy, Society, and State in Paraguay," Servín presented 2023 regional GDP data showing the Central department with 28.5% of the national GDP, Asunción with 17.1%, Alto Paraná with 15.4%, Itapúa with 6.4%, and Caaguazú with 5.9%. "This suggests that more than 70% of production is concentrated in just a few territories in the country," she highlighted.
In contrast, departments such as Caazapá (1.5%), Ñeembucú (0.9%), and Alto Paraguay (0.4%) have significantly smaller shares of the national economy. This concentration is also reflected in the labor market: Asunción, Central, and Alto Paraná report the highest levels of formal employment and informal work rates below the national average, while most other departments are dominated by informal labor.
The Paraguayan business structure follows the same territorial pattern. The Central department accounts for 33% of the country’s companies, Asunción holds 21%, and Alto Paraná registers 13%, together making up approximately 67% of all businesses in Paraguay. Servín noted that the national structure is mainly supported by micro and small enterprises, with a very limited presence of medium and large companies.
The researcher presented an economic-productive regionalization grouping departments by common characteristics. The metropolitan region, comprising Asunción and Central, shows a high level of development, strong economic diversification, and lower social vulnerability rates. The dynamic agro-industrial region—formed by Alto Paraná, Itapúa, Caaguazú, and Canindeyú—is characterized by mechanized agriculture, export-oriented agro-industry, and border trade, with development levels ranging from medium to medium-high.
There is also a smaller border region, mainly made up of Amambay and Ñeembucú; the transitional economies region, which includes Concepción, San Pedro, Cordillera, Paraguarí, Guairá, Caazapá, and Misiones, where poverty is higher and traditional and modern production systems coexist; and the western region, consisting of Alto Paraguay, Boquerón, and Presidente Hayes. "Although this area accounts for only about 3% of the national population, it has significant agricultural and agro-industrial potential that could drive its future development," Servín stated.
Among the departments with the greatest socioeconomic vulnerability, the researcher cited San Pedro, Concepción, and Caazapá. Meanwhile, those best positioned in terms of territorial cohesion include Asunción, Boquerón, Central, Amambay, and Presidente Hayes. Servín warned that GDP per capita should be interpreted cautiously, as it does not necessarily reflect the population’s well-being or the actual income distribution, which is why she incorporated poverty, labor informality, and human capital indicators into her analysis.
The economist identified four priority challenges to advance toward more balanced territorial development: promoting investment and economic activity in lagging territories, fostering greater sustainable productive diversification, strengthening strategic sectors such as family farming, manufacturing, and services, and improving institutional quality and local capacities for innovation and social organization.