TRADE POLICY REVIEW

REPORT BY THE SECRETARIAT

Paraguay

Revision

This report, prepared for the fifth Trade Policy Review of Paraguay, has been drawn up by the WTO Secretariat on its own responsibility. The Secretariat has, as required by the Agreement establishing the Trade Policy Review Mechanism (Annex 3 of the Marrakesh Agreement Establishing the World Trade Organization), sought clarification from Paraguay on its trade policies and practices.

Any technical questions arising from this report may be addressed to Ms Eugenia Lizano (tel. 022 739 6578), Mr Carlos Pérez del Castillo (tel. 022 739 5336), and Ms Stephanie Dorange‑Patoret (tel. 022 739 5497).

Document _WT/TPR/G/463 contains the policy statement submitted by Paraguay.

Note: This report was drafted in Spanish.

CONTENTS

SUMMARY. 6

1  ECONOMIC ENVIRONMENT. 10

1.1  Main features of the economy. 10

1.2  Recent economic developments. 12

1.2.1  Fiscal policy. 13

1.2.2  Monetary policy. 15

1.2.3  Balance of payments. 16

1.3  Trade performance: goods and services. 17

1.3.1  Composition of merchandise trade. 17

1.3.2  Geographical distribution of merchandise trade. 19

1.3.3  Trade in services. 20

1.4  Foreign direct investment 21

2  TRADE AND INVESTMENT REGIMES. 23

2.1  General framework. 23

2.2  Trade policy formulation and objectives. 23

2.3  Trade agreements and arrangements. 25

2.3.1  WTO. 25

2.3.2  Regional and preferential agreements. 26

2.3.2.1  MERCOSUR. 27

2.3.2.2  Bilateral agreements. 29

2.3.3  Other agreements and arrangements. 29

2.4  Investment regime. 29

2.4.1  Investment incentives. 31

3  TRADE POLICIES AND PRACTICES BY MEASURE. 34

3.1  Measures directly affecting imports. 34

3.1.1  Customs procedures, valuation and requirements. 34

3.1.2  Customs valuation. 36

3.1.3  Rules of origin. 36

3.1.4  Tariffs. 38

3.1.4.1  Structure and levels. 38

3.1.4.2  Preferential tariffs. 40

3.1.4.3  Tariff concessions. 40

3.1.5  Other charges affecting imports. 41

3.1.5.1  Value added tax. 42

3.1.5.2  Selective consumption tax. 44

3.1.6  Import prohibitions, restrictions and licensing. 44

3.1.7  Anti-dumping, countervailing and safeguard measures. 45

3.2  Measures directly affecting exports. 47

3.2.1  Customs procedures and requirements. 47

3.2.2  Taxes, charges and levies. 48

3.2.3  Export prohibitions, restrictions and licensing. 49

3.2.4  Export support and promotion. 50

3.2.5  Export financing, insurance and guarantees. 51

3.3  Measures affecting production and trade. 52

3.3.1  Incentives. 52

3.3.2  Standards and other technical requirements. 55

3.3.3  Sanitary and phytosanitary requirements. 56

3.3.4  Competition policy and price controls. 59

3.3.4.1  Competition policy. 59

3.3.4.2  Price controls. 61

3.3.5  State trading and state-owned enterprises. 61

3.3.6  Government procurement 63

3.3.7  Intellectual property rights. 66

4  TRADE POLICIES BY SECTOR. 72

4.1  Agriculture. 72

4.1.1  Measures affecting imports and exports. 74

4.2  Energy. 76

4.2.1  Electricity. 77

4.3  Manufacturing sector 80

4.4  Services. 83

4.4.1  Financial services. 83

4.4.1.1  Banks and other financial intermediation institutions. 83

4.4.1.2  Securities market 87

4.4.1.3  Insurance. 88

4.4.2  Telecommunications. 89

4.4.3  Transport 92

4.4.3.1  River transport 94

4.4.3.2  Air transport 96

5  APPENDIX TABLES. 99

CHARTS

Chart 1.1 Exports by main HS section, 2017-23. 18

Chart 1.2 Imports by HS section, 2017-23. 18

Chart 1.3 Exports by region and main trading partner, 2017-23. 19

Chart 1.4 Imports by region and main trading partner, 2017-23. 20

Chart 1.5 Net direct investment flows by activity and component, 2022. 22

Chart 2.1 Trade agreements in force to which Paraguay is a party, June 2024. 27

Chart 3.1 Frequency distribution of tariffs, 2017 and 2024. 39

Chart 3.2 Dumping or subsidy investigation procedure. 46

Chart 3.3 Safeguard investigation procedure. 47

Chart 3.4 Management of state-owned enterprises, 2024. 63

Chart 3.5 Industrial property protection data, 2017-23. 69

Chart 4.1 Composition of the telephony and Internet market, 2017 and 2023. 92

Chart 4.2 Foreign trade by mode of transport, 2017-23. 93

TABLES

Table 1.1 Basic economic indicators, 2017‑24 (Q1) 10

Table 1.2 Public finances, central government budget implementation, 2017-23. 14

Table 1.3 Monetary indicators, 2017-24 (Q1) 15

Table 1.4 Balance of payments, 2017-23. 16

Table 1.5 Trade in services, 2017-23. 20

Table 1.6 FDI balances by origin, 2017-23. 21

Table 1.7 FDI balances by Paraguay's national classification of activities (CNAP), 2017‑23. 22

Table 2.1 Incentive regimes, 2024. 31

Table 3.1 Structure of MFN tariffs, 2017 and 2024. 38

Table 3.2 CET exceptions applied by Paraguay (2024) 40

Table 3.3 Charges applicable only to imports, 2017 and 2024. 41

Table 3.4 Value added tax, 2024. 42

Table 3.5 Imports under the Tourism Regime (RT), 2017-23. 43

Table 3.6 Selective consumption tax, 2017 and 2024. 44

Table 3.7 Import prohibitions, 2024. 45

Table 3.8 Registration service fees, 2024. 48

Table 3.9 INFONA service fees, 2024. 48

Table 3.10 Export prohibitions and restrictions, 2024. 49

Table 3.11 Maquila operations, 2017–23. 50

Table 3.12 Free trade zone operations, 2017–23. 51

Table 3.13 Main financial support products, 2024. 52

Table 3.14 State-owned enterprises, 2017 and 2024. 62

Table 3.15 Procurement excluded from the scope of the Law on Government Procurement and Supply, 2024. 63

Table 3.16 Procurement procedures, 2017-24. 65

Table 3.17 Government procurement by method, 2017-23. 66

Table 3.18 Pirated or counterfeit products, 2017-23. 71

Table 4.1 Main agricultural sector indicators, 2017-23. 72

Table 4.2 Tariff lines with tariffs that exceed the bound rates, 2024. 74

Table 4.3 Export prohibitions and restrictions, 2024. 75

Table 4.4 Energy balance, 2017-23. 76

Table 4.5 Electricity generation and use, 2017-23. 77

Table 4.6 Low-voltage electricity tariffs, 2024. 79

Table 4.7 Key manufacturing sector indicators, 2017-23. 80

Table 4.8 Products subject to import licensing and tariffs (non-exhaustive list), 2024. 82

Table 4.9 Market share of the five leading banks, 2017‑23. 84

Table 4.10 Loan portfolio balance, 2017‑23. 84

Table 4.11 Performance indicators for banks and financial institutions, 2017‑23. 86

Table 4.12 Stock market data, by market type, 2017‑23. 88

Table 4.13 Insurance sector indicators, 2016/17‑22/23. 89

Table 4.14 Telecommunications sector indicators, 2017-23. 91

Table 4.15 Exports/imports handled in public ports, 2017-23. 96

Table 4.16 Transport and international connectivity data, 2017-24. 97

BOXES

Box 1.1 Support measures to address the COVID-19 pandemic. 13

Box 2.1 Mechanism for the temporary reduction of tariffs for supply reasons. 28

Box 3.1 MERCOSUR Origin Regime (ROM), 2024. 37

Box 4.1 Master plans, 2024. 78

Box 4.2 Cooperative sector 87

APPENDIX TABLES

Table A2.1 WTO notifications, 2017 – 30 June 2024. 99

Table A3.1 Summary analysis of the MFN tariff, 2024. 101

Table A3.2 Tariff lines with MFN tariffs higher than bound tariffs, 2024. 102

Table A3.3 Products subject to import licensing, 2024. 103

Table A4.1 Agricultural support programmes, 2017-23. 108