ission:
(vacant); Charge D'Affaires Gerald McCOLLOCH
embassy:
1776 Avenida Mariscal Lopez, Asuncion
mailing address:
C. P. 402, Asuncion, or APO AA 34036-0001
telephone:
[595] (21) 213-715
FAX:
[595] (21) 213-728
Flag:
three equal, horizontal bands of red (top), white, and blue with an
emblem centered in the white band; unusual flag in that the emblem is
different on each side; the obverse (hoist side at the left) bears the
national coat of arms (a yellow five-pointed star within a green
wreath capped by the words REPUBLICA DEL PARAGUAY, all within two
circles); the reverse (hoist side at the right) bears the seal of the
treasury (a yellow lion below a red Cap of Liberty and the words Paz y
Justicia (Peace and Justice) capped by the words REPUBLICA DEL
PARAGUAY, all within two circles)

@Paraguay, Economy

Overview:
Agriculture, including forestry, accounts for about 25% of GDP,
employs about 45% of the labor force, and provides the bulk of
exports, led by soybeans and cotton. Paraguay lacks substantial
mineral or petroleum resources but possesses a large hydropower
potential. Since 1981 economic performance has declined compared with
the boom period of 1976-81, when real GDP grew at an average annual
rate of nearly 11%. During the period 1982-86 real GDP fell in three
of five years, inflation jumped to an annual rate of 32%, and foreign
debt rose. Factors responsible for the erratic behavior of the economy
were the completion of the Itaipu hydroelectric dam, bad weather for
crops, and weak export prices for agricultural commodities. In 1987
the economy experienced a minor recovery because of improved weather
conditions and stronger international prices for key agricultural
exports. The recovery continued through 1990, on the strength of
bumper crops in 1988-89. In a major step to increase its economic
activity in the region, Paraguay in March 1991 joined the Southern
Cone Common Market (MERCOSUR), which includes Brazil, Argentina, and
Uruguay. In 1992, the government, through an unorthodox approach,
reduced external debt with both commercial and official creditors by
purchasing a sizable amount of the delinquent commercial debt in the
secondary market at a substantial discount. The government had paid
100% of remaining official debt arrears to the US, Germany, France,
and Spain. All commercial debt arrears have been rescheduled. For the