For English speakers, the term Mediterranean evokes images of the French Riviera and sun-drenched beaches; in Spanish, it simply means landlocked.
One of two landlocked countries in the western hemisphere (along with Bolivia), Paraguay has its share of “Mediterranean” charms and challenges. During the late 19th century, the country lost about 60 percent of its population during a devastating war with three of its neighbors—Brazil, Argentina and Uruguay. It also suffered Latin America’s longest dictatorship during the late 20th century.
These days, Paraguay does not feature on the minds of most “Latin Americanists” and policymakers in the U.S. It should.
Today the country is the world’s number three exporter of soybeans and the number six producer of beef. Its dam at Iguazu, on the border with Brazil, is the world’s largest producer of hydroelectricity. Many of the biggest multinationals that contribute to such production are U.S.-based agro-industrial giants. Politically, Paraguayans resisted the so-called “pink wave” of leftist-populism that swept through neighboring Argentina, Brazil and Bolivia, and ruined Venezuela and Nicaragua. The country exerts an independent voice in the Organization of American States; MERCOSUR, a regional economic bloc; and signed on to the Lima Group’s declaration supporting free elections in Venezuela.
Yet, like many Latin American countries, Paraguay struggles with poverty, drug trafficking and corruption. With a per capita GDP of $4,080 per year, Paraguay is one of the poorest in South America. The country’s poverty is on full display in downtown Asunción, the capital, where cramped, dusty tent cities or “favelas” sit side-by-side with the nation’s parliament.
Crime is rampant. The country produces the fourth largest marijuana crop in the world. Brazilian, Bolivian and Paraguayan gangs jockeying for control of Paraguayan drug plantations and trafficking routes have made for violent headlines in recent months. The situation is especially acute in the east, near the tri-border area with Brazil and Argentina, where a “wild west” sense of lawlessness reigns.
Corruption has creeped its way into every branch and every level of government, from the police to the courts, taxes and public administration to customs. Transparency International, a corruption watchdog, ranked Paraguay number 135 out of the 180 it surveys, tied with Russia.
This is where IRI comes in. The Institute is piloting a local transparent governance program in six municipalities in greater Asunción. Many of these municipalities have grown dramatically in the last few years, as rural displacement has created a wave of migration to Asunción and outlying cities. Some municipalities have struggled to keep pace, as the influx of residents stretches the capacity of resource-scarce local governments. The municipalities where IRI works rely heavily on royalties from the country’s hydroelectric dams, passed down through the central government in Asunción, and have little capacity to collect taxes locally. Some intendencias (mayors’ offices), such as Itauguá, are very transparent about how they use their resources and do a noble job of incorporating citizens in local development. Others see their royalties as a slush fund and use their own “discretion” to allocate resources.
IRI is working with targeted municipalities providing assistance and best practices in areas such as public management, participatory budgeting, citizen security, economic development and transparency. For now, it is a drop in the bucket. However, the need is there and so is the political will. Incoming President Mario Abdo Benitez has highlighted local governance, particularly in the country’s north, as a strategic priority. He is right to do so. Local governments—in Paraguay as elsewhere in the region—are on the front lines of these fights.Top