As many countries seek to find their footing in a changing global trade ecosystem, Paraguay is emerging as a compelling case study for infrastructure investment, logistics development, and regional integration.
After securing investment grade status in 2024 and leading Latin America with 6.6% growth in 2025, Paraguay is building on its macroeconomic gains to position itself as a platform for regional trade and logistics. Today, the country is completing the central stretch of a new continental highway, while pursuing institutional reforms to modernize one of the world’s largest inland barge fleets, among other steps to improve connectivity and competitiveness.
Can infrastructure keep pace with growth, or will it remain a constraint?
Raúl Valdez, president of the Paraguayan Chamber of Oilseed and Grain Processors (CAPPRO) and vice president of the Paraguayan Center of River and Maritime Ship Operators (CAFyM), shares his assessment of the country’s progress and what challenges remain, in an interview with Global Americans fellow Gregory Ross.
Responses have been edited for length and clarity.
Despite being one of the region’s smaller markets, Paraguay sits at the center of several of South America’s biggest infrastructure stories, from the Hidrovía Paraguay-Paraná and Bioceanic Corridor to abundant hydropower increasingly attracting energy-intensive industry. How do you see Paraguay’s role in regional trade and logistics evolving over the next decade?
Paraguay has the conditions and, increasingly, the determination to become a logistics and production hub for South America. For decades, being landlocked was seen primarily as a constraint. But the country has learned to turn its geographic location and navigable rivers into competitive advantages, developing one of the region’s largest river fleets and an extensive network of private ports.
The Bioceanic Corridor adds a new dimension, bringing South America’s productive heartland closer to ports on both the Atlantic and Pacific. This could turn Paraguay into a multimodal platform serving one of the world’s most important regions for food production and natural resources.
But Paraguay’s ambition should go beyond becoming a transit country. Its abundant hydropower, natural resources, agricultural production, and agro-industrial capabilities provide a strong foundation for adding more value domestically and attracting energy-intensive industries.
In the next decade, I see Paraguay evolving from a landlocked exporter of primary products into a regional platform for logistics, food, energy, and industry. Reaching that potential will require coordinated infrastructure, stronger and modern institutions, predictable rules, and effective integration with neighboring countries. If we make progress on those fronts, Paraguay will not simply be a route between two oceans. It will become a center for production, processing, and distribution serving both the region and the world.
Upwards of 80% of Paraguay’s foreign trade moves by the Paraguay-Paraná river system. In June, Argentina awarded a 25-year private concession to dredge and maintain its 1,500-kilometer stretch of the river, while the Bolsa de Comercio de Rosario estimates that waterway cargo volumes could more than double by 2035 as export-oriented projects come online in Paraguay, Bolivia, and Brazil. What does this concession mean for Paraguayan exporters? How can policymakers and industry help ensure the corridor remains competitive as trade continues to grow?
The performance of the waterway is a strategic issue for the entire country, and the new concession creates an opportunity to restore predictability along the Argentine section. The interim period between the previous concession and the current one, managed by the Argentine government, was not positive for Paraguayan exporters. We faced uncertainty and a weak link between costs being charged and improvements users could actually see. Private management brings new expectations, but success will be measured by tangible results.
We must be clear. Paraguay’s private sector is not satisfied with the current tariff of US$1.30 per net registered ton. There is still insufficient transparency about how it is calculated or what users receive in return. Paraguay does not object to paying for services that are actually provided, but we expect the concessionaires to work with users on a technical basis to correct distortions and establish a fair relationship between tariffs, investment, and service.
It is also essential to distinguish between river segments: the southern sections serve both river and oceangoing traffic, while the northern section, carrying more Paraguayan cargo, is used mainly by river vessels. Their operating conditions and investment needs are different, so they should not be subject to the same technical and tariff treatment. In the northern section, there is still little clarity about what improvements are planned.
Argentina’s current government has shown greater openness to dialogue. That openness must now translate into participation, information, and results. Paraguay, for its part, must strengthen its national position and give its institutions greater relative weight and resources to defend their positions. Together with the government, we are advancing a reform that could become a milestone for national logistics and enhance our ability to protect the waterway’s long-term competitiveness.
As you mention, the Peña administration has proposed elevating Paraguay’s Marina Mercante (Merchant Marine), which represents the world’s third-largest river barge fleet, to a National Directorate to strengthen management of the fleet and port capacity. Is Paraguay’s logistics infrastructure keeping pace with regional trade growth, and can institutional reform meaningfully strengthen that position? Or does the country risk losing ground to better-capitalized infrastructure in Argentina and Brazil?
This reform could shape the future of Paraguayan logistics. Paraguay now has one of the world’s largest river fleets. While its growth was initially supported by the incorporation of vessels from the Mississippi River system, over time, local shipyards developed the capacity to build and maintain high-quality vessels, supporting the expansion of Paraguayan and regional trade. This was accompanied by significant private investment and the development of an extensive port network.
Our institutions and regulatory framework, however, did not evolve at the same pace. Private infrastructure advanced more quickly than the public sector’s capacity to manage and regulate the system and represent the national interest.
This is why, under the leadership of the Ministry of Industry and Commerce, with support from the Inter-American Development Bank and through broad public-private cooperation, we are supporting a far-reaching reform of the Merchant Marine. Giving it greater institutional standing is important but not enough. We must modernize our laws, simplify procedures, professionalize oversight, and adopt the standards used by the world’s most modern and successful trading systems.
If Paraguay completes this reform, it will do more than strengthen its competitiveness against larger regional infrastructure systems. It could become a model for the region, showing how modern public administration can support industrial growth, encourage investment, and strategically manage one of the country’s most important assets. That is the true scale of this opportunity.
In July, Paraguay and Brazil joined their two spans of major new international bridge across the upper Paraguay River, part of the Bioceanic Corridor that will stretch through the Chaco region to Chile. To what extent could this new highway system reshape Paraguayan logistics?
The Bioceanic Corridor represents the next stage in the evolution of the region’s logistics system and could fundamentally change how Paraguay and the heart of South America connect with the world.
Its intersection with the Paraguay-Paraná Waterway will bring together major north-south and east-west axes. This convergence can connect inland production regions with ports on two oceans, expand access to markets, and position Paraguay as the central hub of one of South America’s most important logistics networks.
We should not view roads, railways, and rivers as competing systems. Each provides different capabilities. Roads offer territorial reach, flexibility, and speed for certain types of cargo. Future rail development could add scale and efficiency along specific corridors. But river transport will remain Paraguay’s clearest competitive advantage for moving large volumes over long distances because of its capacity, cost efficiency, and lower environmental impact.
The real transformation will come from integrating these modes. A multimodal network of this scale could drive the development of new industrial, logistical, and energy hubs, particularly in the Chaco, while connecting regions currently far removed from major trade flows.
Beyond grains and minerals, these corridors could also move processed foods, fuels, industrial inputs, and products we cannot yet imagine being produced in this region. If Paraguay develops the necessary connections, services, and coordination, it will move beyond being a transit country and become a platform for production, processing, and distribution between the Atlantic and Pacific.
Looking ahead, what are the most significant bottlenecks that remain on Paraguay’s infrastructure map? Where is there opportunity to attract outside investment, including U.S. capital and financing, to bridge gaps and further enable growth of Paraguayan value-added industry and trade?
Paraguay has made significant progress, but it still faces bottlenecks that limit its ability to turn economic growth into industrial development. The most important include the navigability and predictability of the Paraguay-Paraná river system; the quality of connections between production areas, industrial facilities, and ports; the power infrastructure needed to deliver our abundant energy to new projects; and more efficient customs and regulatory processes.
Addressing these constraints would do more than allow Paraguay to move larger volumes. It would enable the country to produce and add more value domestically. At CAPPRO, we see a very concrete opportunity. Paraguay is a major soybean producer with substantial installed processing capacity, yet it continues to export a considerable share of its production without processing it locally. With more competitive conditions, we can produce more oils, proteins, food products, biofuels, and other higher-value derivatives.
The United States is already an important partner in Paraguay’s development. U.S. and global companies associated with CAPPRO, including ADM, Cargill, and Bunge, have invested in the country for decades, helping build its agro-industrial, storage, and logistics platform through capital, technology, and expertise. (Editor’s note: Valdez holds a position as Head of Logistics for ADM Paraguay.)
The opportunity now is to build on that foundation. U.S. capital, technology, and long-term financing can support the next generation of road and intermodal infrastructure, modernization and expansion of local shipyards, energy infrastructure for new industrial projects, and specialized logistics, engineering, and technology services. These are critical capabilities for connecting production more efficiently, strengthening Paraguay’s river industry, and enabling greater domestic value addition.
We are looking for partners who share a long-term vision and want to help build a regional platform for food, energy, industry, and trade. U.S. investors can find tangible opportunities here and contribute to a broad transformation of Paraguay’s productive economy.
Gregory Ross is a senior associate with McLarty Associates’ Brazil and Southern Cone practice and a fellow at Global Americans.
Photo via Datamar News
