The Opportunity For The Small Investor In Paraguay Today
Mid-19th century, Paraguay was a wealthy nation thanks to protectionist dictators who happily exported tea and wood to the outside world but taxed imports heavily, creating a self-sufficient, wealthy, and (unlike neighbors Brazil and Argentina) debt-free country. In fact, at the time, Paraguay was flush enough to pay cash for technology that allowed it to own its railroad. Elsewhere in the region, it was the British who owned and profited from the railway operations.
According to locals, that healthy economy inspired an attempt to interfere with Britain’s tea monopoly in Europe, which led to the war of the Triple Alliance in 1864. Other stories about the start of this devastating conflict include that Paraguay was just trying to protect Uruguay’s independence and got tricked into a much larger-scale conflict. Still others say the dictator at the time, Francisco Solano Lopez, was delusional enough to attempt to take over South America.
Whatever the reasons for the war, the results were disastrous for Paraguay. By the end of fighting in 1870, the population was decimated and 25% of its territory was lost. Brazil occupied the country for six years.
A century-and-a-half later, Paraguay is back on the path to prosperity. The country has the second-lowest per capita GDP
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