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AmericasAugust 29 2010

Ground to a halt

Road to nowhere: traffic in Asunción has increased dramatically while road building has stalledParaguay's potential as a trade route is badly hampered by its poor transport infrastructure, while many of its businesses struggle to function amid frequent power cuts. The government has promised to invest in improving this situation through a series of PPPs, a welcome development but one which only begins to address the country's problems. Silvia Pavoni reports.
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Ground to a halt

When looking at a map of South America, it is tempting to think of Paraguay as a small country, nestled as it is between the two behemoths of Brazil and Argentina. However, such appearances can be deceptive; Paraguay is bigger in size than Japan or Germany, though its population is significantly smaller than both countries. Most of Paraguay's 6 million people live in its eastern region while the Chaco, in the west, stretches across 60% of the country but is inhabited by only 3% of the population. Too remote and lacking of all-weather roads to enable any crop-planting industry to thrive, the Chaco's infrastructure is in dire need of modernisation, something it has in common with the rest of the country if Paraguay wishes to sustain its economic growth.

Travelling across Paraguay is not straightforward. Its outdated and limited rail network was dismantled in 2006 as roads and rivers offered cheaper and more efficient modes of transport. The road network leaves a lot to be desired, however, and Paraguay's substandard electricity transmission and distribution system has been hindering the expansion plans of many of the country's businesses for years.

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Silvia Pavoni is editor in chief of The Banker. Silvia also serves as an advisory board member for the Women of the Future Programme and for the European Risk Management Council, and is part of the London council of non-profit WILL, Women in Leadership in Latin America. In 2019, she was awarded an honorary fellowship by City University of London.
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