President Santiago Peña completes three years in government this August 15 with a record marked by macroeconomic advances and persistent fiscal challenges. Among the main results are the attainment of investment-grade status, which elevated Paraguay's international visibility, and robust economic growth, with GDP projected at US$63.8 billion in June — 47% higher than at the start of his term. The inflow of foreign direct investment (FDI) also jumped from an average of US$300 million to around US$1 billion in the period.
However, the fiscal scenario remains under pressure. The deficit, which reached 4.1% of GDP in 2023, was reduced to 2.5% in 2024 and 2% in 2025, but the government recently acknowledged missing the fiscal target for 2026, when the projection is for a shortfall of 3.2%. For 2027, the estimate is even higher: 3.9%. The Minister of Economy and Finance, Oscar Lovera, justified the relaxation of targets due to accumulated debts with suppliers, which total about US$1.27 billion (2.6% of GDP), and announced the contracting of new external debt of US$600 million to cover pending obligations.
Total public debt reached US$21.9 billion in June, an increase of 32.4% since 2023, although it still represents 34.4% of GDP — below the 40% limit established by the Fiscal Responsibility Law. Experts warn, however, that the growth in debt interest payments reduces the room for investment in areas such as health, education, and infrastructure. The tax burden, at only 11.3% of GDP, is also cited as an obstacle, as it limits the state's ability to sustain the growing indebtedness.
In revenue collection, the creation of the National Directorate of Tax Revenue (DNIT), which unified Customs and the Subsecretariat of Taxation, boosted results until mid-2025. However, the fall of the dollar and the economic slowdown weakened revenues in the second half of 2025, leading the DNIT to intensify inspections and evaluate the elimination of tax exemptions. The government rules out, however, the creation of new taxes.
Structural reforms, such as that of the Caja Fiscal (Fiscal Fund), face resistance in Congress, where the pension system deficit reached G. 1.31 trillion (US$218 million) in the first half of 2026. Analysts also criticize the slowness in implementing approved laws, such as the Public Service Law and the one creating the Superintendency of Retirements and Pensions, whose regulatory decrees have not yet been published.
Economist Dionisio Borda, a former finance minister, assessed that the government "promised a lot, but delivered little," highlighting that the slogan "We are going to be better" mainly benefited the president's political sector. Borda questioned the effectiveness of Peña's 68 international trips, which, according to him, expanded the leader's geographical knowledge more than Paraguay's presence abroad. The political agenda, with municipal elections in 2026 and general elections in 2028, is also expected to limit the space for new measures in the next two years.
For analyst Amílcar Ferreira, the investment-grade status and economic growth contrast with institutional fragility, especially in the justice system. He cited as a setback the appointment of Hernán Rivas to the Jury for the Impeachment of Magistrates, between 2020 and 2023, and the public defense made by Peña at the time, as a sign of political influence over the Judiciary. Ferreira stressed that, despite positive macroeconomic indicators, the persistence of "political vices" prevents structural advances.