Paraguay Explores UAE Investment Opportunities Amid Trade Deficit with China
Trade analysts in Paraguay raised concerns over the country’s trade imbalance with China, referencing official statistics from the Central Bank of Paraguay (BCP). In the first quarter of 2025, 37.6% of Paraguay’s imports originated from China, while exports to China were negligible at 0.3%, largely due to Asunción’s political alignment regarding Taiwan, which limits direct trade with Beijing.
To navigate this situation, Paraguayan exporters are rerouting their shipments through Uruguay or Argentina to access the Chinese market. The BCP emphasized that the growing trade deficit with China warrants serious consideration by the Paraguayan government.
In this context, Paraguayan President Santiago Peña received a proposal from Mohamed bin Zayed Al Nahyan, the leader of the United Arab Emirates, to further explore investment opportunities. Discussions may encompass airport expansions, infrastructure projects, and collaborations related to carbon credit markets, with a noticeable rise in Paraguay’s exports to the UAE.
After a meeting between President Peña and UAE Ambassador Al-Saghira Wabran Hamad Mubarak Al-Ahbabi, Paraguay revisited a 2024 agreement concerning the Silvio Pettirossi Airport expansion and other related initiatives. There is also an interest in funding a segment of the Bioceanic Road Corridor and advancing a pact signed at COP28 regarding the international exchange of mitigation outcomes (ITMOs) in the carbon trading space.
The two leaders held their initial bilateral discussions in October 2023 during the United Nations Climate Change Conference in Dubai (COP28), shortly after Peña’s visit to the UAE as President-elect prior to assuming office.
Since establishing a commercial office in the Middle East in February 2023, Paraguay has seen a remarkable 170% increase in exports to the UAE, including items such as yerba mate, high-end fashion, samu’u trees, cotton seeds, and more.
Furthermore, Paraguay’s Ministry of Education has signed a Memorandum of Understanding with Israel to enhance educational cooperation, covering areas like pedagogy, psychology, and teaching technology to bolster Paraguayan institutions through knowledge exchange and partnerships with Israeli experts.
Education Minister Luis Fernando Ramírez expressed gratitude to Ambassador Amit Mekel for the agreement, highlighting its potential to advance Paraguay’s educational advancements through the experience and development achieved by Israel.