| Overview |
Paraguay
has a market economy marked by a large informal sector. The
informal sector features both reexport of imported consumer
goods to neighboring countries as well as the activities of
thousands of microenterprises and urban street vendors. Because
of the importance of the informal sector, accurate economic
measures are difficult to obtain. A large percentage of the
population derives their living from agricultural activity,
often on a subsistence basis. The formal economy grew by an
average of about 3% annually in 1995-97; but GDP declined
slightly in 1998, 1999, and 2000, rose slightly in 2001, only
to fall again in 2002. On a per capita basis, real income
has stagnated at 1980 levels. Most observers attribute Paraguay's
poor economic performance to political uncertainty, corruption,
lack of progress on structural reform, substantial internal
and external debt, and deficient infrastructure. |
