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Wednesday, July 9, 2025
Paraguay Chases Crime Lords And Economic Growth
Paraguay Chases Crime Lords and Economic Growth
Paraguay
International criminal agencies are hunting for alleged Uruguayan drug trafficker and money launderer Sebastian Marset, who has strong ties to Paraguay and could have returned there after he disappeared a few years ago, according to InSight Crime.
If he did, he won’t be safe there for long, analysts say.
That’s because Paraguay is stepping up its fight against organized crime and the drugs the criminals trade in. Officials see it as key to increasing investment and growth.
To that end, Paraguay recently showed off the purchase of six Tucano turboprop airplanes from Brazil to combat drug runners and other criminals in the landlocked South American country.
The country also recently purchased radar sets from American aerospace giant Northrop Grumman that would help track planes transporting drugs and money, wrote Diálogo Américas, giving the Tucanos better eyes in the sky.
In recent years, Paraguay has become a key country for the transit of cocaine then transported across the Atlantic in container ships: Cocaine produced mainly in Peru and Bolivia is moved through Paraguay to Brazil and Argentina, entering from neighboring Bolivia by land and air routes through the Chaco, the vast and sparsely populated region in the northwest of the country, where airstrips are being built for drug trafficking. The acquisition of radar will help Paraguay curb these criminal activities, Diálogo Américas added.
Paraguayan President Santiago Peña said that the purchases signaled a crucial change of direction because of urgent priorities, and marked “the beginning of a new era in the fight against transnational organized crime and narcotrafficking.”
“Today the Paraguayan State invests in defense and security, no longer to confront our neighbors. That remained in the past. Today we face different dangers. Organized crime, drug trafficking, transnational crimes know no borders, know no nationality, and this requires that States be increasingly organized,” Peña said in a recent speech as reported by Spanish news agency EFE.
Peña’s comments were about more than law and order, however. The purchase of the planes reflected how the Paraguayan state was seeking to move on from one of the most stressful periods in its history since the end of the 35-year dictatorship of Alfredo Stroessner in 1989.
When the military regime ended, “many wounds” remained that were “eroding and deteriorating the capacity for response” of the military, which is why he considered it “fundamental” to strengthen it now, Peña added.
Meanwhile, the International Monetary Fund (IMF) recently called for Paraguay to strengthen measures against money laundering and violent crime, in order to create more opportunities and improve the economy, MercoPress noted.
Fast-growing Paraguay has become South America’s star economy over the past two decades but has also failed to tackle one of the world’s most endemic organized crime problems.
Even so, the financial institution recently praised Paraguay’s efforts to grow its economy after the ravages of the coronavirus pandemic and, even more damaging, a severe drought in early 2022. Climate change has made such droughts more frequent and extreme in recent years, too, added the Fitch Ratings agency at the time.
With the help of almost $200 million in IMF financing, the country’s economy is now rebounding. Gross domestic product grew by almost 6 percent in the first quarter of the year, driven by a nearly 13 percent increase in construction sector activity, for example, reported bnamericas. The exploding interest in the country’s Paraguay-Paraná river system is also stoking economic growth, Americas Quarterly added.
“Now, with a surge of infrastructure projects along its banks, the corridor is reemerging as a vital, contested axis for regional trade and security,” it wrote. “Both investment and foreign interest are ramping up: China and the US are maneuvering for influence along the corridor, as are transnational criminal organizations, for Andes-to-Atlantic drug trafficking and other illicit activity.”
That’s part of the reason the country is heightening its fight against drug trafficking: It’s worried that it will dampen or even crowd out true economic development, investment, and growth.
There are other critical issues beyond organized crime that Paraguay must tackle to promote growth, analysts say.
“Paraguay’s institutional aspect is very weak,” Ramiro Blazquez of investment bank BancTrust told the Financial Times. “It’s a country with a lot of perceived corruption and crony capitalism, and many problems with judicial independence.”
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