Paraguay closes 2019 with its lowest growth prospects since 2012

The Paraguayan economy concluded 2019 with an estimated growth of its gross domestic product (GDP) of 0.2%, according to data from the Central Bank of Paraguay (BCP), the lowest figure since 2012, when the country's GDP fell 0 ,5 %.

The BCP, as well as international organizations, were reducing the projections of the Paraguayan GDP as the year progressed, as a consequence of the impact of the weather, with floods and droughts, according to the season, in the agricultural campaign.

Both agriculture and livestock accumulated two quarters in negative, with greater incidence in the first, and showed improvements in the third quarter, although insufficient to counteract the fall suffered between January and June.

Thus, until September, agriculture had lost 10.3% and livestock, 2.7%, as collected in the data of the BCP Quarterly Accounts Bulletin, corresponding to the third quarter of 2019.

The rainy season also delayed the execution of infrastructure investment and caused the construction sector to suffer, and although it experienced a "greater dynamism" between July and September 2019 and rebounded 6.3%, in the accumulated of the year, until September, 3.1% was left, according to the BCP third quarter newsletter.

Only the services sector managed to remain positive, with a growth of 2.9% until September.

Given this slowdown that the Paraguayan economy was showing, together with the social unrest that was beginning to generate the situation, the Ministry of Finance announced in early June an investment of 1,543.51 million dollars with which it expected the economy to rebound in the face to the second semester of the year.

Of that amount, most of it would go to infrastructure (about 1,175 million dollars), 114.51 million dollars would go to social assistance and the remaining amount, about 254 million dollars, for employment, trade and production .

Despite this attempt to overcome, the owner of the economic portfolio, Benigno López, admitted in October that Paraguay was experiencing a period of economic "recession" after learning that the GDP registered a 3% drop in the second quarter of 2019 with compared to the same period of 2018.

In his accountability this December, López referred to this 2019 as "a complex year" and relied on "a rebound next year."

The prospects of the BCP guarantee that the Paraguayan GDP will grow again at a rate of 4.1%, and also those of the International Monetary Fund (IMF), which in its October projections set the evolution of the Paraguayan GDP in the 4%, above the rest of the region.

As for inflation in the country, the BCP reported on Monday that the 2019 figure stood at 2.8%, below 3.2% the previous year, which again fell below the target of the 4% marking the institution.


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