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    Invest in Paraguay

    When it comes to investing in Paraguay, many investors are attracted to the country’s real estate market.

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        Real estate investing in Paraguay
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        Invest in Paraguay: Growing Opportunities

        When it comes to investing in Paraguay, many investors are attracted to the country’s real estate market.

        Like starting a business, real estate investment is wide open to foreigners, with almost no restrictions.

        We say almost none because there are some minor legal restrictions on Brazilians and Argentines buying land in Paraguay close to their national borders.

        Real estate investments can be divided into urban and rural types. Urban basically means Asuncion. You will find interesting opportunities investing in the construction of low-cost housing for workers.

        Plus, some experts believe this is a growth area, especially as financing is becoming easier.

        The main area of interest for foreigners, however, is undoubtedly rural land. This may be farmland, or it may be raw land in the Chaco, where you really can buy land for US$50 to US$100 per hectare.

        What you will do with such land, or even how you will get to it, is another matter.

        Lief Simon, Director of Overseas Property Alert, Founde of Simon Letter, and Founder, of Global Property Advisor

        Reviewed By Lief Simon

        Lief Simon is the managing editor of Global Property Advisor, Simon Letter, and Offshore Living Letter. He has purchased more than 45 properties, investing in 23 different countries around the world.

        Investing In Agricultural Projects

        For serious agriculture, Paraguay definitely offers the best value land in the Southern Cone region.

        The highest yielding developed farmland (typically producing soya or sugar cane), intensively operated and located close to processing plants, costs US$5,000 to US$10,000 per hectare.

        Good cattle ranch land goes for about US$500 to US$2,500 per hectare, mainly depending on how far it is from transportation infrastructure.

        This kind of agricultural land is good for semi-active investors who are looking for a high ROI and position for future development while keeping their capital safe.

        Good management companies that will manage your land for you are available, and plenty of not-so-good management companies so trusted local advice is essential.

        You can also simply rent your land out. Current rates of return are about 3% plus potential capital growth.

        Virgin land of the type that you can actually do something with goes for US$200 to US$600 per hectare.

        By “virgin land” we mean land that is covered by trees or scrub forests in the Chaco, with good soil fertility so it can be cleared and used for cattle ranching. This latter option is about as close to a passive investment as you can get, as it requires no maintenance nor further investment—you are just speculating on the land price increasing over time.

        When buying this kind of land, you are looking for a favorable combination of climate, topography, soil fertility, and environmental viability of agriculture in the future.

        Many people have a dream of living out in the middle of nowhere and running their own agricultural operation. In this case, what you need is a smallholding, or estancia, probably in the south of the country, not too far from the main road, offering investment in agriculture and a gentleman-farmer or wild-west lifestyle (your choice) combined.

        Incentives for Investment in Paraguay

        The agency responsible for foreign investment promotion (REDIEX) at the Ministry of Finance in Asuncion.

        Foreign Investment Law 117/91 reiterates that foreigners have the same guarantees, rights, and obligations enjoyed by any Paraguayan investor. There are no restricted areas, no discrimination, and no limitations.

        Paraguay has signed a number of bilateral and international investment protection treaties and specifically recognizes international arbitration, meaning that in cases of disputes, foreigners can seek redress in an international forum.

        The most important foreign investment incentive is Law 60/90. This law grants tax incentives for investments. Investments may be in the form of capital (including loans, etc.), equipment, trademarks, technology transfers, and the like. In other words, the definition of investments is quite broad. In return for the investment, the following exemptions are granted:

        All government fees for registering companies are waived
        Total exemption from customs duties
        Total exemption from withholding tax on repayment of loans exceeding US$5 million
        Total exemption from taxes on profits and dividends for 10 years for investments exceeding US$5 million

        Incentives under Law 60/90 are generally approved within 45 days of the application.

        Paraguay’s Maquila program, based on a similar program in Mexico, allows a local entity to sign a contract with a foreign entity to produce goods or provide services for export only. The system allows for duty-free import of raw materials and a complete tax exemption with the exception of a 1% fixed tax on turnover.

        Opening A Paraguayan Brokerage Account

        Anyone interested in participating in the Paraguayan economy can open a brokerage account with as little as a few thousand dollars, and it can even be done by mail.

        You can simply keep cash in the brokerage account, or use it to invest in the mainly fixed-interest securities traded on the small Asuncion stock exchange. Nonresidents and foreign and/or offshore companies can open these brokerage accounts.

        This can be an excellent way of testing the water or gaining a small foothold investment in the Paraguayan economy. It is also a discreet way of stashing some funds away for a rainy day.

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          A world full of fun, adventure, and profit awaits! Sign up for our free daily e-letter, Overseas Opportunity Letter, and we'll send you a FREE report on the 10 Best Places To Retire In Style Overseas In
          Lief Simon, Director of Overseas Property Alert, Founde of Simon Letter, and Founder, of Global Property Advisor

          Reviewed By Lief Simon

          Lief Simon is the managing editor of Global Property Advisor, Simon Letter, and Offshore Living Letter. He has purchased more than 45 properties, investing in 23 different countries around the world.

          Invest in Paraguay - FAQ's

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