This second Trade Policy Review of Paraguay has contributed to an
improved understanding of its trade and related policies and of the
challenges Paraguay faces. As was commented by our discussant,
Ambassador Saborío, the most important part of a Trade Policy Review
is the domestic dialogue it requires amongst government departments
and other stakeholders. He also noted that the reports of the country
under review and the Secretariat become important reference documents
for all Members and I thank both the delegation of Paraguay and the
Secretariat for the excellence of their work.
This meeting has provided an opportunity for transparency and for
useful exchange. This was possible in good part due to the personal
participation of Minister Bergen, Vice-Ministers Ramírez and Segovia,
and Ambassador Gauto, as well as the excellent work of the rest of the
Paraguayan delegation. The full support provided by the Paraguayan
authorities to the whole review process shows the importance that
Paraguay attaches to the multilateral trading system. I also thank
Ambassador Saborío and Members for their thoughtful interventions, all
of which contributed positively to our work.
Members highlighted Paraguay's resumption of economic expansion, after
years of stagnation resulting in part from external shocks. Trade was
instrumental to the recovery, playing as it does a key role in the
economy. Paraguay was encouraged to consolidate the macroeconomic
policies that have fostered growth, and to carry on further reforms to
modernize the public sector, and strengthen its institutions.
Members commended Paraguay for its active participation in the WTO and
its contribution to the Doha Development Agenda, and noted its efforts
in favour of landlocked economies. The relationship between Paraguay's
WTO and MERCOSUR commitments was raised by a number of Members.
Members called attention to Paraguay's modest investment record, and
the suspension of the privatization process. It was suggested that, to
foster investment, greater predictability and transparency in the
investment regime were necessary. In this respect, further GATS
commitments by Paraguay could play an important role.
Members agreed that Paraguay had taken significant steps to modernize
and simplify its trade regime. Paraguay's applied tariffs have
declined since 1997, although the overall average tariff on
agricultural products remains higher than on other products. Questions
were posed on other measures affecting imports, such as non-tariff
charges, and on the notification and transparency of technical
regulations and SPS requirements. The use of export taxes and controls
during the period under review was questioned.
Enquiries were made about Paraguay's incentive programmes, such as the
automotive and maquila regimes, and about the absence of subsidies or
TRIMs-related notifications to the WTO. Members observed that the
enactment of new public procurement legislation had brought greater
transparency and predictability to government purchases. Members also
took note of Paraguay's steps to enhance the protection of
intellectual property rights, and encouraged it to continue these
Members were of the view that Paraguay should continue with the reform
of its services sector. Members enquired, and Paraguay provided
clarifications, about expected changes to the public banks
legislation, treatment of foreign investors in banking and the
development of the telecommunications sector. It was noted that
Paraguay's international transportation costs remain amongst the
highest in the Western Hemisphere, and Paraguay was prompted to
consider opening the sector to further competition.
I thank the Paraguayan delegation for the written answers provided to
In conclusion, I welcome Paraguay's ongoing efforts to strengthen its
institutions and to use trade as a catalyst for growth, and encourage
it to enhance its multilateral commitments to give greater
predictability to its trade and investment regimes. At the same time,
I invite Members to address the trade barriers and market distortions
that affect Paraguay's exports. With these remarks I conclude the
Trade Policy Review of Paraguay.