Paraguay’s most important natural resources are the rivers, the forest and the fertile soil. The country has almost no mineral resources that can be extracted. At the Paraná border, there are several hydroelectric power plants that are crucial for Paraguay’s economy.
Itaiipu dam, which is co-owned with Brazil, was the world’s largest power plant when it was built. Three ravines in China are now larger, but Itaipú is still the largest in terms of how much electricity is actually generated. The artificial pond, larger than Lake Mälaren, was completed in 1982 and electricity production began in 1984.
COUNTRYAAH: Major exports by Paraguay with a full list of the top products exported by the country. Includes trade value in U.S. dollars and the percentage for each product category.
Of the electricity produced at Itaipú, 90 percent goes to Brazil. For many years, Brazil only had to pay a fraction of the international market price for electricity from Itaipú, according to an agreement from the 1970s when both countries were governed by military regimes. Under President Fernando Lugo’s regime in 2008–2012, Paraguay managed to negotiate to get three times as much paid. Paraguay’s payments to Brazil for loans in connection with the construction have also been a matter of contention.
The Yacyretá hydroelectric plant is located 30 kilometers further down Paraná and is operated in collaboration with Argentina. The construction of Yacyretá, which was completed in 1998, is considered to have caused significant damage to wildlife and has also – like Itaipú – been criticized for gross corruption within the jointly owned foundation that runs the work. Argentina has also prepared a very favorable price for the electric power from Paraguay.
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Hydropower generates important export revenue and accounts for over half of Paraguay’s total energy demand. Other renewable sources cover a quarter and imported oil by just under a fifth.
The mining industry is mainly limited to limestone, marble and clay quarries.
No oil or natural gas is produced in Paraguay, but there are hopes of future recovery. In 2013, the government stated that large natural gas assets were discovered in Alto Paraná and a British company reported in 2014 on large oil deposits in Chaco. So far, all fossil fuels are being imported. During the years that Paraguay was ruled by President Fernando Lugo, the country was able to buy oil cheaply from Venezuela. That opportunity disappeared when Lugo was deposed in 2012.
A serious environmental problem is the extensive deforestation. Deforestation leads to soil erosion and water pollution. Expanded areas for soybean cultivation and grazing land to enable meat production are important reasons behind the spoilage. Exports of timber and charcoal are also driving forces. There is extensive illegal logging and there is no systematic replanting. In Chaco, which also extends into Argentina and Bolivia, deforestation is progressing faster than anywhere else in the world, according to a study done at the University of Maryland.
FACTS – ENERGY AND ENVIRONMENT
Energy use per person
789 kilos of oil equivalent (2014)
Electricity consumption per person
1564 kWh, kWh (2014)
Carbon dioxide emissions in total
5 702 thousand tonnes (2014)
Carbon dioxide emissions per inhabitant
0.9 tonnes (2014)
The share of energy from renewable sources
61.7 percent (2015)
2013
December
Paraguay again in Mercosur
Paraguay rejoins the Mercosur trade organization. This can happen after President Cartes, after some hesitation, decided to recognize Venezuela’s membership. Venezuela became a member during Paraguay’s suspension, which Cartes considers violates the organization’s statutes.
November
Senator immunity is revoked
The Senate gives in to the public pressure and cancels the immunity of a corruption-accused senator, Victor Bogado, who belongs to the ruling Colorado Party. Demonstrations and a social media campaign have been targeted at 23 senators who defended Bogado. The campaign has led to the senators being banned at a number of bars, restaurants and cinemas.
August
Paraguay again in Unasur
Paraguay re-joins as a member of Unasur at the Economic and Political Cooperation Organization Summit in Suriname.
Sharpened measures against guerrillas
President Cartes writes on a decree that the military is entitled to strike against the Marxist guerrilla EPP in three departments. The decree comes a few days after a new law was passed that gives the president extended powers to deploy the military in unrest. The change in the law is directed at EPP.
President Cartes takes office
August 15th
Horacio Cartes takes over as president and promises to fight poverty. His government is largely made up of technocrats and businessmen, not party peaks, as is usually the case.
April
The Colorado Party wins the election
April 21
The Colorado Party regains presidential power when its candidate Horatio Cartes wins with 46 percent of the vote, against 37 percent for PLRA’s Efraín Alegre, 6 percent for AP’s Mario Ferreiro, 3.3 percent for FG’s Aníbal Carrillo Iramain, and 1.1 percent for PPQ’s Miguel Carrizosa Galiano (see Political system). The other six candidates receive less than 1 percent. In the congressional elections, the Colorado Party is moving forward strongly, receiving 44 of the 80 seats in the Chamber of Deputies, and thus its own majority there. In the Senate, Coloroado gets 19 seats. The PLRA receives unchanged seats in the Chamber of Deputies (27) and loses a few seats in the Senate (to 12). The support for Unace collapses after Oviedo’s death.
Harsh accusations in the electoral movement
The tone is high at the final stage of the election movement. Accusations of corruption and irregularities hail. PLRA’s Efraín Alegre reiterates allegations that have long figured against Coloradio Party candidate Horatio Cartes, about involvement in smuggling, mafia operations and tax offenses. ABC Color magazine publishes information that Cartes has hidden money in the Cook Islands tax haven. The Colorado Party threatens to oust Senate Speaker Jorge Oviedo Matto, who belongs to Unace. The threat causes Oviedo Matto to take time off from the post. Officially, this is because he is getting rid of allegations of corruption, but he probably also wants to avoid hurting Alegre before the election.
Partial alliance ahead of the election
A few weeks before the election, Efraín Alegre announces that PLRA has entered into an alliance with Unace, which is believed to strengthen his chances. In the opinion polls, Cartes otherwise has a lead of a few percentage points.
February
Presidential candidate dies in helicopter crash
February 2
Former coup general Lino Oviedo (see Modern History), who is presidential candidate for Unace ahead of the April elections, is killed when a helicopter crashes. Authorities first say the crash was due to severe weather but then add an international investigation to determine the cause. Unace’s candidate in the election now becomes a nephew of Oviedo.
