Paraguay’s Rise To Global Relevance & The Next Decade Of Growth

If you’ve been following Paraguay Potential for a while, you know we look beyond the headlines to find the meaningful and impactful market signals so we can understand how (and where) economic growth is going to play out inside of Paraguay.

…before anyone else even knows what’s happening. 

In this edition, we are going to explore Paraguay's already established (and growing) position when it comes to global trade.

We will also unpack a very interesting study commissioned by Rediex, Paraguay’s investment and export promotion agency. 

I won't give away too much, but since 2003, Paraguay’s GDP has doubled. 

DOUBLED.

For now, let’s just say that this economic analysis, conducted by McKinsey & Company (one of the world’s most respected consulting firms), includes some bold predictions; however, they are backed up with a concrete pathway to making their hypothesis a reality.

I spent hours reviewing this report (which was in Spanish, by the way), and I've provided you with an easily digestible overview of its contents.

If you’re on the fence about allocating a material percentage of your capital into Paraguay, this analysis is going to have you running to the phone to call my partner, Fernando, about adding some Paraguayan real estate into your portfolio.

For anyone new here, I encourage you to read this newsletter very carefully and do so right until the end because, beyond the educational aspect that this newsletter will provide you, I have also included a very special DEAL OF THE WEEK.

Let’s get into it. 

A Small Country With Big Trade Reach: Paraguay’s Expanding Network of Strategic Alliances

Paraguay is a full founding member of MERCOSUR, Latin America’s largest trading bloc. 

This alliance provides Paraguay with tariff-free access to over 300 million consumers across the region and has been the backbone of its export success in the beef, soy, energy, and manufactured goods sectors. 

But what most investors don’t realize is that Paraguay isn’t just sitting back and relying on increased regional access through its MERCOSUR involvement.

Paraguay is not content to rest on its laurels… 

…it’s pushing outward. 

The EFTA bloc, which consists of Switzerland, Norway, Iceland, and Liechtenstein, finalized a Free Trade Agreement with MERCOSUR. 

This opens the door for Paraguayan exports, especially food and energy products, to flow directly into stable, high-income European markets.

EFTA countries are known for being:

• High-income.

• Politically stable.

• Highly regulated.

• And selective when it comes to international trade deals.

So when a bloc like this signs a Free Trade Agreement with MERCOSUR (and thus with Paraguay), it’s a strong vote of confidence in the region’s long-term economic potential and legal reliability.

The agreement establishes clear and predictable rules regarding tariffs, customs procedures, and certification of origin… precisely the kind of framework that fosters trust with global buyers.

Now consider this: a small, landlocked country without ocean access, and without a flashy international brand (yet), is now officially aligned with some of the wealthiest and most well-regulated economies in the world.

EFTA is known for being cautious, slow, and highly selective in its approach to trade, which is exactly why this deal is such a powerful signal.

It’s a vote of confidence not just in Paraguay’s economic potential, but in the country’s reputation as a fair, respected player on the global stage. 

Paraguay already benefits from preferential trade access to the US, the EU, Chile, Mexico, and Bolivia, and is expanding partnerships in Asia, the Middle East, and Africa.

This tells us that even though Paraguay may not yet be a household name, and many people may still probably can’t point it out on a map, the people who make global decisions are well aware of Paraguay… and its potential. 

The McKinsey Report: An In-Depth Breakdown

In May of 2024, McKinsey & Company, arguably the most influential management consultancy on the planet, developed an in-depth analysis and formed a roadmap for Paraguay’s economic transformation.

It was commissioned by Rediex (the country’s investment and export promotion agency), and it reads like a technical playbook with serious implications. 

This report serves as a blueprint for how Paraguay can continue to evolve from a growing and stable nation into a serious economic powerhouse. 

…and if you’re an investor looking to understand where the money’s going next, this roadmap is pure gold.

So, let’s dig into what matters to the key points outlined in the report: 

A Historic Growth Run… That’s Just Getting Started

Paraguay’s GDP has doubled since 2003. 

That alone is beyond impressive… but here’s what’s more important:

This growth didn’t come from debt-fuelled government spending.

It came from commodity exports, low inflation, and monetary discipline.

In a region of the world where financial instability has driven inflation and interest rates up, Paraguay has been able to do the opposite: 

• It has kept inflation under control.

• It has maintained a strong banking system and low national debt.

• It has allowed the private sector (not bureaucrats) to drive progress.

That means growth in Paraguay is stable and won’t fluctuate like other “developing nations.” 

McKinsey & Company are betting that if the right moves are made now, the country can double its GDP again by 2035.

Read the above again because IT IS NOT a typo.

Paraguay has all the resources, tools, government support, and global recognition to the point where the top management consultancy in the world sees a clear and realistic pathway to DOUBLING ITS GDP IN THE NEXT 10 YEARS.

Now, let’s take a look at the implications of a country doubling its GDP:

If a country is expected to double its GDP within the next decade, you better believe that every square meter of land, every rental unit, and every productive asset inside that economy is going to ride that wave up.

Paraguay's route to this will be driven by infrastructure investment, industrial expansion, in-demand exports, and a modernization of its logistical and agricultural backbones.

This isn’t just good news… it’s a buy signal.

Because when GDP doubles, wealth creation accelerates.

Middle-class spending power expands.

Domestic consumption rises.

Urbanization speeds up.

Housing demand surges.

Capital inflow from private equity groups and foreign governments skyrockets.

When you’re on the ground here, you can see it for yourself and feel it in the air… something special is happening.

When a country is gearing up for a decade of massive growth and expansion, the feeling is palpable.

…and the investors who feel it early will be the ones holding the best real estate, the best land, and the best-positioned income-producing assets before prices start to reflect the reality.

When a country doubles its GDP in a single generation, here are just some of the implications:

• Real estate doesn’t just rise… it transforms everything. Dirt roads become paved boulevards. Empty corners become commercial hotspots. Rental yields go from good to excellent as tenants earn more, and thus, are willing and able to pay more for quality, comfort and luxury. 
  

• Foreign direct investment explodes. Multinationals don’t ignore growth… they chase it. And when they move in, they build office parks, logistics centers, hotels, factories… and they bring people with them who need… you guessed it; homes (along with other services, too, of course).  
  

• The middle class grows, which brings with it a demand for housing. People want more space, more privacy, and they want to live in better neighbourhoods (the exact types of projects we’re developing as I write this). 
  

• Land gets scarce. Especially land that’s already cleared, close to infrastructure, and zoned for development. You know… the kind we’ve been acquiring while the rest of the world has been sleeping on Paraguay.
  

• Banking and financial services mature, which opens up local financing options. Interest rates drop, which makes mortgages more accessible. That makes it easier to sell to end-users, which in turn makes your exit strategy even more attractive.

Here’s what this means for you:

• If you’re holding land near the growth corridors, expect appreciation.

• If you own rental units tied to the rising middle class, expect higher occupancy and stronger returns.

• If you’re looking to diversify your international portfolio with high-upside, low-tax, real-asset exposure… Paraguay has gone from a BUY to a BUY NOW.

But remember, folks, windows like this don’t stay open forever… 

Once the infrastructure is finished and once the major institutional investors start placing their bets, it’ll be too late to get in the market at these prices. 

$20 Billion In Growth-Driving Investment Opportunities Are On The Table

The report lays out six strategic sectors that are expected to drive Paraguay’s next decade of growth, and many of them overlap directly with our investment interests:

• Infrastructure & Logistics (increased roads and rail port access)

• Construction Materials & Housing

• Energy (renewables, decentralized generation like the smaller hydro plants I told you about earlier this month)

• Agricultural production and export

• Food processing and manufacturing

• Urban development in mid-tier cities

….20 billion dollars of investment opportunities issued in a country with a population smaller than the state of Georgia.

The outlined investment spend is grounded in the reality of Paraguay’s demographics and geography, and the report outlines that unlocking intra-country migration, plus continuing to encourage migration from Brazil and Argentina, will have a massive impact.

Even if only a portion of this $20 billion is realized, Paraguay’s real estate values are going to shoot through the roof.  

You don’t inject billions of dollars into hard assets without creating massive effects in regard to land prices and real estate.

You don’t roll out new roads and major infrastructure projects without igniting new demand in towns and neighbourhoods that were once overlooked due to their geographical inaccessibility.

You don’t help a middle class emerge without sparking a change in the desires as well as the means of the people who will now have greater flexibility relating to where and how they live, spend, and invest.

And if even a fraction of this $20 billion plan comes to fruition (which is almost a certainty, ALL of it will happen, given how much of it is already in motion), real estate values in key regions are going to move up fast.

To put it simply, you can’t transform a nation without lifting the value of the land it sits on.

…and this is exactly why we’re so focused and bullish on the future of Paraguay. 

A rising tide lifts all ships… but only if you’re already in the water when it comes in.

Beyond Asunción: Where the Real Growth Is Expected

One of the strongest signals in the entire report is that the next wave of investment and development won’t be centred in Asunción (like it has traditionally been… until my partners and I entered the country in a real way, I must add). 

Instead, the report outlines the fact that growth will expand into smaller cities.

…Like Ciudad del Este, where we are literally leading the charge.

What’s crucial to note is that in these smaller cities, the prices don’t yet reflect the coming growth. 

These cities don’t have inflated land values or prices per square foot that don’t match the current or coming value.

What they have is demand, anticipated future demand and a lack of supply.

This means cities like Ciudad del Este are positioned perfectly to benefit from the new wave of infrastructure development.

That said, it’s worth noting that Ciudad del Este is already booming.  

As I mentioned in the last edition of Paraguay Potential, my partner Fernando, who is on the ground year-round in Paraguay, notes that from Wednesday to Sunday, visitors are hard-pressed to find a hotel or Airbnb available in Ciudad del Este. 

That’s why McKinsey recommends strategic investment in everything from basic infrastructure to workforce housing and logistics parks in these key, yet still overlooked cities, like Ciudad del Este. 

And if you’re an investor who understands land banking, pre-construction real estate, or buy-and-hold rental plays… this is smile-worthy news. 

This Isn’t A Government Play - It’s a Plan Driven By The Private Sector

McKinsey built the entire roadmap for Paraguay’s path to doubling its GDP by 2035 around attracting private capital.

The report specifically recommends:

• Faster permitting and regulatory efficiency

• Better project transparency and risk mitigation tools

• Stronger institutional frameworks to protect institutional investors

In other words, they know what foreign capital needs in order to flow into emerging markets… and they’re setting the table accordingly.

Paraguay is uniquely positioned to deliver on this because it doesn’t have the bloated public sector or systemic corruption that derails growth and prosperity like it does in some other Latin American countries.

So while Peru and Bolivia battle political instability and government corruption, Paraguay is building an investor-friendly ecosystem from the ground up.

If you’re already positioned here, or are thinking about investing here soon, you’re getting a roadmap to: 

• Acquire assets at pre-growth pricing

• Buy ahead of infrastructure that’s already planned

• Lease your rental units to workers and professionals arriving to facilitate and build the projects 

• …and eventually exit to end buyers once capital gains have been realized and the market matures

That’s the cycle.

That’s how long-term wealth gets built in frontier markets.

McKinsey just confirmed what we’ve been seeing on the ground for years… but now it’s out in the open for others to see. 

The country is moving up and to the right, and thus, institutional investors are starting to circle like sharks.

If you haven’t already, now is the time when you can still beat them to the punch and get in with the biggest potential upside.

DEAL OF THE WEEK: Better Relationships, Better Pricing, Better Upside. 

When we first started analyzing Paraguay’s real estate potential years ago, our hypothesis was clear:

Asunción had too much supply, so we focused our efforts to the east. 

Asuncion was oversaturated, overpriced, and overcrowded with developers all fighting over the same few city blocks near Shopping del Sol. 

Meanwhile, we noted the planned infrastructure developments to the east (the kind that produces double-digit returns), so that is where my partners and I have been allocating our capital.

And it paid off…

… and it still very much is…

Ciudad del Este is booming, and the opportunities here are still vast.

Make no mistake, we are still investing heavily in Ciudad del Este and will continue to do so until the opportunity for massive returns no longer exists, which, to be clear, I don’t see happening anytime soon.

However, even in a market like Asunción, where other developers had arrived before us and established themselves in what they believed at the time was the premier market in Paraguay, there are still numerous opportunities nearby…

…if you aren’t afraid to lead the charge into once-overlooked zones, that is.

In Asunción, there are rare corners of the city that still haven’t been tapped.

There are still specific zones in Asunción where families want to live, and yet no one’s building quite the right thing there.

That’s where this week’s featured DEAL OF THE WEEK comes in.

The building is called Hype, and it’s a 29-story residential tower located in an overlooked pocket of Asunción.

It’s not beside the Shopping del Sol centre like most of the other skyscrapers in the area are.

It’s not buried within the central business district. 

Hype sits on Santísima Trinidad Avenue, a neighbourhood that is desired and inhabited by Paraguay’s elite. 

Santísima Trinidad is home to some of the top schools in the country.

It’s where buildings like Jade Park and Palacio de los Patos are (where some of the most affluent families in the country live).  

It’s where you can step outside and find lush greenery, top-tier supermarkets, universities, and cafés… without being burdened by traffic or unbearable street noise. 

Plus, it’s also one of the few places in Asunción that’s directly connected to the future, as the newly completed Héroes del Chaco Bridge that connects this particular neighbourhood to Nueva Asunción is just minutes away…

…and given the rate of growth in Nueva Asunción, this is a sub-pocket where long-term growth is all but guaranteed, meaning those of us who invest in this building won’t have to think twice about seeing flat returns or lacklustre capital appreciation just due to the simple fact of its strategic proximity to an area where infrastructure growth, including the cities most important and impactful bridges have been, and continue to be built.  

The Hype building is designed around the one thing you can’t replicate…

In the world of real estate, there’s one thing that can’t be copied, cloned, or replaced once it’s gone:

Unobstructed views.

It is one of the only high-rise projects in the city that offers permanent, protected views in both directions.

Hype sits directly across from a public plaza, and behind it sits a low-density residential zone protected by city ordinance. 

That means nothing higher than three stories can ever be built around it.

This 29-story building will rise far above everything else… and stay above it forever.

This is protected in law.

And that makes the Hype building incredibly rare and desirable. 

…and this isn’t a building made up of 30m² “boxes in the sky”.

It’s a building with oversized, livable layouts. 

The one-bedroom plus units (the ones I secured at an incredible price for you today) have 55m² of livable space.

The hype building is loaded with amenities, all of which your tenants (or yourself) will have unrestricted access to: 

• Rooftop Sky Lounge, pool, and outdoor bar

• Co-working space and executive meeting rooms

• Playroom and kids zone

• Two “quinchos” (special Paraguay style BBQ areas)

• Sauna, gym, chill/work spaces, and laundry facilities

So, without further ado, here are the exact specs on the two available units that I have secured for readers of Paraguay Potential this week: 

Units 8-A & Unit 8-C

Type: 1-Bedroom Plus
Size: 55m²
Original Launch price: $87,267 USD
Your (cash only) price: $78,540 USD 

Because of our longstanding relationship with the developers, we’re offering a cash deal on a couple of units that I have secured at prices lower than what even the earliest investors paid.

These 1-bedroom “Plus Units” are perfect for your personal use or for generating hands-off rental income.

We see this project as a hybrid: one with excellent capital appreciation potential…

But it’s also a building you’d want to stay in yourself.

That’s why we’re highlighting the “Plus Units” in this edition of Paraguay Potential. 

You can take a look at the full 360º walkthrough of the Hype building here and see the entire development for yourself: https://360.pics3dstudio.com/hypetrinidad/

Well, if this isn’t your first time, you already know the drill; if you want in, you need to write my partner Fernando right away here: [email protected] 

These units won’t last long… especially at these prices.

In a future edition, I hope to secure a few more units inside the Hype building, but I need to make it clear that if I do, the prices will not be this low.

I was told by my partners that this pricing is a one-time thing, and even if I am able to secure more units here in the future, they will be more expensive.

Well, folks, that is going to do it for this edition of Paraguay Potential.

I am thrilled to have the chance to have so many savvy investors just like you reading my work closely.

If you have any questions, comments or suggestions, please feel free to reply directly to this email.

My goal with Paraguay Potential is to produce the most useful and informative newsletter I possibly can; thus, if you have noted ways in which I could reach that goal, I’d love to hear from you.

Speak soon,
Mikkel