What is the importance for Paraguay of the final signing of the agreement between the European Union and Mercosur?
First and foremost, membership in Mercosur gives Paraguay access to a larger market and benefits people and companies who want to work with Paraguay. Logically, the Mercosur agreement with the European Union will give an even greater dimension, greater predictability, to these investments in Paraguay. We are interested in continuing the work for future stability and that is why we want this agreement with the European Union.
Is Paraguay essentially an agricultural economy today?
It is an agricultural country, but it also has a lot of experience in the trade and service sector and we are making a significant effort to have greater added value in our raw materials, develop the industrial sector, which we believe is the way we have to move on..
This year the economy will grow by about 4.5%, maybe even 5%. Does this mean you are in good shape and are recovering well from the pandemic?
The pandemic was very complicated for the whole world, but Paraguay was the region’s economy that resisted the most and was the first to respond afterwards. And now it is also the first, a few months ago, that stopped raising interest rates because inflation was already under control. The growth forecast for this year is therefore 5%.
Paraguay talks a lot about an example of stability. The now elected president, Santiago Peña, will have a Chamber of Deputies and a Senate from the same party for the first time in many years. Is this image of political stability also a way for Paraguay to attract investment?
Stability always brings more certainty in investments. In the past 30 years, governments could not have a majority in parliament, but we always had stability through negotiations. Now there can be more, because it is the same party, there is more stability, but I think we already had stability before this majority. For example, we have had the same currency, the Guarani, for 80 years, and the idea is that monetary stability will continue as well.
Keeping the currency is almost an exception in Latin America, isn’t it?
I think so. There is an older currency, but not with this stability, without converting it, I think it’s the only one.
There are two other issues that are often talked about and that affect Latin America, namely crime and corruption. How will this affect Paraguay?
Corruption is a very difficult problem, we have to work to reduce it. I can say that in Paraguay we have a public information law about wages for several years, everything is available to the public. In other words, it’s a way to make things more transparent. There is a lot of public awareness about the need to fight corruption and pressure is put on people who want to misbehave in government. There are also structural problems, which we need to solve by financing public policies, which are very important for turning growth into development. We have growth, but we also need development and with public policies we will also be able to help prevent crime.
Is crime high or not?
I don’t think we can say it’s high. It’s a crime that’s out there, as is the danger, but I think it’s also a global problem. Just as investment, business, political ideas and the environment have become global, so too has crime become global. So for the countries, not just Paraguay, it’s a challenge, because the state has a territorial limit, but the challenge is global.
Does crime in Paraguay come from outside, is it organized from outside?
It is also related to this and we cannot fight it alone, that is why cooperation is needed to fight organized crime worldwide. But at the Paraguayan level, we always try to fight crime, but it is necessary to rely on public policy and there are structural problems for public policy financing that are related to the Paraguayan reality. The population, the size of the population, that’s the size of the market, the state of the country, the cost of being contained. It is necessary to attract investment, but for that it is necessary to provide incentives, which translates into less taxes, which means we have less money to fund government policies. It’s a situation we’re struggling with, especially looking for more investment, but it takes time and effort.
In this global crisis, because of the war in Ukraine, I know that Paraguay voted against Russia in the United Nations. Was Paraguay indirectly affected by the sanctions against Russia because it stopped exporting meat to that market?
In general, such a conflict affects everyone in one way or another. We are exporters and Russia has been an important market for Paraguayan meat, and the sanctions also affect exporters in that market because they hit banks in Russia.
Have you stopped exporting because Russia can no longer pay you?
It was difficult to collect, but there are also effects of inflation on food, on energy on a global level, this is something that affects all countries. Less developed countries are also more affected. We hope it will come to an end soon, with a swift resolution for the good of all, as all parties are affected, including those not directly involved in the conflict.
Paraguay has diplomatic relations with Taiwan, but not with the People’s Republic of China. The Chinese economic presence is very strong throughout Latin America, but has Taiwanese investment in Paraguay worked as an alternative?
The relationship with Taiwan is important, and it is a matter of principles and values, but also in the last government there has been a significant increase in exports and in the quality of Paraguayan exports to Taiwan. We are also working on some sustainable energy projects with Taiwan, electromobility, to develop capacities in our country. The relationship with Taiwan is therefore important, not only in principle, but also in practice. But in terms of imports, for example, 40% of imports come from China.
40% of what Paraguay imports comes from China?
Yes.
And can Paraguay also export to China?
Not much directly, but probably through other ports.
Is there a political party that advocates establishing relations with China and breaking them with Taiwan?
Among the major parties, in the last election, one of the candidates talked about studying this possibility, but I don’t think it’s a topic of discussion today.
Paraguay has no diplomatic relations with China, with Europe it has this desire for greater rapprochement, namely through Mercosur. And what about the relationship with the United States?
It is very close. We are now negotiating, we have a very old cooperation with the United States, very old agreements. There is a coherence in the vision, in the principles of democracy, that we share with Europe in the field of freedom and democracy. We’re also in the same region, in the same hemisphere, so it’s an old, traditional partner, and now we’re negotiating the opening of the meat market to the United States.
During your visit to Portugal, was the issue of Mercosur the main objective?
No, our vision is to approach Portugal. Portugal has a privileged position in the European Union, Mercosur is important for Paraguay, but Paraguay and Portugal can cooperate, bilaterally, and also with Mercosur. The aim is to work with Portugal, to see the opportunities we have to develop the relationship in areas that could be important for both countries. That’s the mission.
Aleixo Garcia was the first European to arrive in Paraguay, the historical Dr. Francia had a Portuguese father. Are the people of Paraguay aware of this historical connection with Portugal?
There is a common history and it is known. The first person from Europe to arrive was from Portugal, so there is an old relationship and a presence throughout history. I think today we also need to find a way to identify more strategic elements for joint work with Portugal.
Does your proximity to Brazil mean that many people speak Portuguese in Paraguay?
There are many people who speak Portuguese because they came from Brazil and went to live in Paraguay, so their descendants speak Portuguese, but there are also people who work in Brazil and need to speak Portuguese for professional reasons. Our relationship with Brazil is also very important on several levels.
Source: DN
