With just a US$1 million annual contribution, Paraguay has secured over US$640 million in non-reimbursable funding from Mercosur’s Structural Convergence Fund (FOCEM), making it the bloc’s top beneficiary.
FOCEM is a regional solidarity mechanism established in 2005 to finance infrastructure and social projects, promoting equitable development among Mercosur member states. Mercosur is a regional trade bloc in South America, established in 1991 by the Treaty of Asunción, aimed at promoting free trade and economic integration among its member states.
A strategic return on investment
FOCEM has proven to be the bloc’s most impactful regional solidarity mechanism, enabling Paraguay to secure the highest share of funding, With an annual contribution of US$1 million, Paraguay has secured more than $640 million in funding over the past twenty years.
The investments in Paraguay have contributed to essential national infrastructure improvements, including the Costanera Norte and Viaducto Botánico in Asunción. They have also facilitated the 500 KV Itaipú–Villa Hayes transmission line and extensive road surfacing across Guairá, San Pedro, and Concepción.
FOCEM has also contributed to the construction of over 1,000 social housing units in Paraguay, improved access to clean water and sanitation, and promoted tourism in areas like Jesuit Missions and Alto Paraná. These initiatives have enhanced regional connectivity and the daily lives of thousands of families in the country.
20 years of FOCEM
The Fund for the Structural Convergence of Mercosur (FOCEM) was officially launched on 19 June 2005, during the XXVIII Meeting of the Common Market Council in Asunción. FOCEM has financed US$1.043 billion of the US$1.61 billion in projects proposed by Mercosur member states. Paraguay has been granted over 60% of the total executed funds, demonstrating its effectiveness in advancing regional equity and long-term growth.
“Regional funds driving national progress”
Ambassador Didier Olmedo, the Paraguayan permanent representative to Mercosur, emphasised in an interview with Tribuna on Paraguay TV that the country ‘s contribution is minor compared to the benefit it secures. “With just US$1 million a year, Paraguay secured an average return of 48 million annually over the past decade,” Olmedo noted. “It’s a clear example of how regional funds can be used strategically to drive national progress.”
