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Navigating Paraguay’s Economic Waters: A Troubling Scenario Unfolds

As the calendar flipped to the third week of August, all eyes were on the Paraguay River, hovering just one centimeter above its historical minimum. For a nation heavily reliant on barge transport along the Paraná and Paraguay Rivers for import and export operations, this slight increase was a small silver lining in an otherwise dire situation.

Here’s how the ripple effects of the river’s precarious water levels are impacting Paraguayan foreign trade freight rates:

Rising Costs, Shrinking Margins
- In July, import/export operations faced a staggering 29.2% year-on-year increase in costs. This spike was attributed to lower water levels hampering navigation and limiting cargo capacity per vessel.
- With imports surging by 20.6% to 938,451 tons, the average freight price surged by 7.1%. These elevated logistics prices trickle down to retail prices, exacerbating the financial strain on businesses and consumers alike.
Uncertain Future amid Climate Woes
- Héctor Cristaldo of Paraguay’s Union of Production Guilds paints a grim picture, citing a challenging 2024/25 campaign. The looming presence of La Niña on the horizon casts a shadow of uncertainty, compounded by dwindling prices.
- With the projected shortfall of US$1.8 to 2 billion in the Paraguayan economy for 2025, stakeholders brace themselves for turbulent times ahead.
Fueling Concerns: A Bumpy Road Ahead
- The reliance on fuel imports adds another layer of complexity to the equation. As barges operate under capacity and reduced speeds due to the water levels, the outlook remains bleak.
- Cristaldo emphasizes the need for caution and precision in financial planning, acknowledging the challenges posed by persistently low water levels and their implications on operating costs.

Navigating these uncharted waters requires a delicate balance of foresight, resilience, and adaptability. As the waves of uncertainty crash against Paraguay’s economic shores, stakeholders must band together, armed with prudence and perseverance, to weather the storm ahead. Only through strategic planning and collaborative efforts can they steer the ship towards calmer economic waters once again.