Landlocked Paraguay advancing in global political discourse
Last updated on February 27th, 2023 at 11:32 am
While the world grapples the, South America’s landlocked country of Paraguay has emerged to be a success story in the region. Imposing strict lockdown and aggressive social distancing measures in early March, the country recorded the least number of cases as compared to nations in South America. As the citizens remain in total quarantine, police and military kept a stringent watch over the streets and punished those violating the lockdown restrictions.
However, the economy and income of several people was hit hard due to shutdowns. In an attempt to mitigate the implications of the pandemic, the government raised $1 billion in sovereign bonds as an aid to finance the health emergency. The Parliament also approved a anti-crisis fiscal package which includes investments on programs catering to health and social protection, support to small businesses and a subsidy for informal workers. After being able to effectively curb the spread of COVID-19 virus in the country, the Paraguay government is planning on easing its lockdown by May through a ‘smart quarantine’.
It is important to note that before the pandemic hit the globe, the country was effectively recovering from the weather-induced recession in 2019. While Paraguay is vulnerable to domestic economic slowdown due to the ramifications of nationwide lockdown, the country’s economy is expected to recover and grow by 2021. According to a report by the World Bank, the landlocked nation has a strong macroeconomic framework based on flexible exchange rate mechanism, inflation targeting, and fiscal rules. Recently, the IMF also approved the disbursement of USD 274 million to support the country’s fight against the Coronavirus outbreak.
Prior to the pandemic woes, Paraguay stood out as an emerging-market democracy, receiving appreciation from US Secretary of State Mike Pompeo for its transition to democracy which has served as an inspiration to the South American region. Over the past few years, the small landlocked country has went through some notably economic and political reforms. Over the past decade, its economy has grown at an annual average of 5%, which is significantly higher than those of its neighbours. It has worked with the United States to tackle illicit cross-border activities including improving counter-narcotics cooperation.
Taking their friendly relations ahead, the US and Paraguay signed a trade and investment framework agreement in January 2017.
Furthermore, at the December 2019 White House summit meeting, US President Donald Trump and Paraguay President Mario Abdo Benitez expressed joint commitment to deepening the partnership between the two countries. They also agreed upon strengthening their defence and security cooperation.
In conclusion, the relationship between the US and Paraguay is progressing in world politics and will continue to do so with the joint efforts.