Paraguay Economy - 2005

Economy - overview:
Landlocked Paraguay has a market economy marked by a large informal sector. This sector features both reexport of imported consumer goods to neighboring countries as well as the activities of thousands of microenterprises and urban street vendors. Because of the importance of the informal sector, accurate economic measures are difficult to obtain. A large percentage of the population derives their living from agricultural activity, often on a subsistence basis. The formal economy grew by an average of about 3% annually in 1995-97, but averaged near-zero growth in 1998-2001 and contracted by 2.3 percent in 2002, in response to regional contagion and an outbreak of hoof-and-mouth desease. On a per capita basis, real income has stagnated at 1980 levels. Most observers attribute Paraguay's poor economic performance to political uncertainty, corruption, lack of progress on structural reform, substantial internal and external debt, and deficient infrastructure. Aided by a firmer exchange rate and perhaps a greater confidence in the economic policy of the Duarte FRUTOS administration, the economy rebounded in 2003 and 2004, posting modest growth each year.

GDP:
purchasing power parity - $29.93 billion (2004 est.)

GDP - real growth rate:
2.8% (2004 est.)

GDP - per capita:
purchasing power parity - $4,800 (2004 est.)

GDP - composition by sector:
agriculture: 25.3%
industry: 24.9%
services: 49.8% (2004 est.)

Labor force:
2.66 million (2004 est.)

Labor force - by occupation:
agriculture 45%

Unemployment rate:
15.1% (2004 est.)

Population below poverty line:
36% (2001 est.)

Household income or consumption by percentage share:
lowest 10%: 0.5%
highest 10%: 43.8% (1998)

Distribution of family income - Gini index:
57.7 (1998)

Inflation rate (consumer prices):
5.1% (2004 est.)

Investment (gross fixed):
18.1% of GDP (2004 est.)

Budget:
revenues: $1.123 billion
expenditures: $1.129 billion, including capital expenditures of $700 million (2004 est.)

Public debt:
39.2% of GDP (2004 est.)

Agriculture - products:
cotton, sugarcane, soybeans, corn, wheat, tobacco, cassava (tapioca), fruits, vegetables; beef, pork, eggs, milk; timber

Industries:
sugar, cement, textiles, beverages, wood products, steel, metallurgic, electric power

Industrial production growth rate:
0% (2000 est.)

Electricity - production:
48.36 billion kWh (2002)

Electricity - consumption:
2.469 billion kWh (2002)

Electricity - exports:
42.51 billion kWh (2002)

Electricity - imports:
0 kWh (2002)

Oil - production:
0 bbl/day (2001 est.)

Oil - consumption:
25,000 bbl/day (2001 est.)

Oil - exports:
NA

Oil - imports:
NA

Current account balance:
$-36.11 million (2004 est.)

Exports:
$2.936 billion f.o.b. (2004 est.)

Exports - commodities:
soybeans, feed, cotton, meat, edible oils, electricity, wood, leather

Exports - partners:
Brazil 27.8%, Uruguay 15.9%, Italy 7.1%, Switzerland 5.6%, Argentina 4.3%, Netherlands 4.2% (2004)

Imports:
$3.33 billion f.o.b. (2004 est.)

Imports - commodities:
road vehicles, consumer goods, tobacco, petroleum products, electrical machinery

Imports - partners:
Brazil 24.3%, US 22.3%, Argentina 16.2%, China 9.9%, Hong Kong 5% (2004)

Reserves of foreign exchange and gold:
$1.164 billion (2004 est.)

Debt - external:
$3.239 billion (2004 est.)

Economic aid - recipient:
NA

Currency (code):
guarani (PYG)

Exchange rates:
guarani per US dollar - 5,974.6 (2004), 6,424.3 (2003), 5,716.3 (2002), 4,105.9 (2001), 3,486.4 (2000)