Paraguay’s growth outlook for 2025 and 2026 remains close to 4% according to a recent report published by the United Nations Department of Economic and Social Affairs. Regional growth, on the other hand, would be around 2.5%.
The report entitled “World Economic Situation and Perspective 2025” estimates that Paraguay’s economy will grow 3.8% this year and that in 2026 this growth will remain at that rate, with an estimate of 3.7%.
At the regional level, the growth rate of countries would remain at an average of 2.6% for this year and 2.2% for 2026. Only Argentina would experience growth close to 4% for this year, although that number would drop again to 2.5% for next year.
According to the report, the economic outlook for Latin America and the Caribbean will strengthen in 2025 supported by more robust household spending and monetary policy easing; however, the region faces significant downside risks, such as domestic political uncertainties and weaker-than-expected external demand.
Internal and external risks for Paraguay’s Growth Outlook
Among these risks, on the external front, there is a sharper-than-expected slowdown in China and the United States, which would negatively affect exports, remittances and capital flows.
On the domestic front, the report cites political uncertainty that could undermine business and investment confidence, as well as climate-related disruptions, particularly in the Caribbean, that could test fiscal policies and disrupt agricultural production, leading to food inflation.
