Paraguay

This report compiles comparable tax revenue statistics over the period 1990-2020 for 27 Latin American and Caribbean economies. Based on the OECD Revenue Statistics database, it applies the OECD methodology to countries in Latin America and the Caribbean to enable comparison of tax levels and tax structures on a consistent basis, both among the economies of the region and with other economies. This publication is jointly undertaken by the OECD Centre for Tax Policy and Administration, the OECD Development Centre, the Inter-American Center of Tax Administrations (CIAT), the Economic Commission for Latin America and the Caribbean (ECLAC) and the Inter-American Development Bank (IDB).

Many Latin American countries have experienced improvements in income over recent decades, with several of them now classified as high-income or upper middle-income in terms of conventional metrics. But has this change been mirrored in improvements across the different areas of people’s lives? How’s Life in Latin America? Measuring Well-being for Policy Making addresses this question by presenting comparative evidence for Latin America and the Caribbean (LAC) with a focus on 11 LAC countries (Argentina, Brazil, Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, Mexico, Paraguay, Peru and Uruguay). Spanning material conditions, quality of life, resources for future well-being, and inequalities, the report presents available evidence on well-being both before and since the onset of the pandemic, based on the OECD Well-being Framework. It also identifies priorities for addressing well-being gaps and describes how well-being frameworks are used in policy within Latin America and elsewhere around the world, providing lessons for governments on what is needed to put people’s well-being at the centre of their action. The report is part of the EU Regional Facility for Development in Transition for Latin America and the Caribbean.

Using household data from 15 countries in Latin America and Africa, this paper explores linkages between informality and education-occupation matching. The paper applies a unified methodology to measuring education-occupation mismatches and informality, consistently with the international labour and statistical standards in this area. The results suggest that in the majority of low- and middle-income developing countries with available data, workers in informal jobs have higher odds of being undereducated as compared to workers in formal jobs. Workers in formal jobs, in contrast, have higher chances of being overeducated. These results are consistent for dependent as well as for independent workers. They also hold for men and for women according to the gender-disaggregated analysis. Moreover, in the majority of countries considered in this paper, the matching-informality nexus is also related to the extent of informality in a given area: in labour markets with higher informality, informal workers in particular have a higher chance of being undereducated. The paper discusses policy implications of these findings.

This paper studies the potential drivers of governments’ approval rates in 18 Latin American countries using Internet search query data from Google Trends and traditional data sources. It employs monthly panel data between January 2006 and December 2015. The analysis tests several specifications including traditional explanatory variables of governments’ approval rates – i.e. inflation, unemployment rate, GDP growth, output gap – and subjective explanatory variables – e.g. perception of corruption and insecurity. For the latter, it uses Internet search query data to proxy citizens’ main social concerns, which are expected to drive governments’ approval rates. The results show that the perception of corruption and insecurity, and complaints about public services have a statistically significant association with governments’ approval rates. This paper also discusses the potential of Internet search query data as a tool for policy makers to understand better citizens’ perceptions, since it provides highly anonymous and high-frequency series in real-time.

Paraguay has set itself ambitious development goals for 2030. To achieve them, it will have to tackle two major challenges: buttressing sources of sustainable economic prosperity and putting the country on a more inclusive development path. Progressing towards a more inclusive society will require a broad and vigorous reform agenda. First, the country’s healthcare system requires systemic reform to widen its coverage, reduce Paraguayans’ vulnerability in the face of health risks and increase the efficiency of health service provision. Second, the social protection system needs to overcome its fragmentation and become more effective in delivering the right services and risk management tools to citizens according to their needs. In particular, the pension system requires reforms to increase its coverage and become more equitable and more sustainable. Third, the quality and the inclusiveness of its education and training system need to be strengthened to generate the skills the economy needs, and provide opportunities to all. Based on the analysis and recommendations undertaken in Volumes 1 and 2 of this Multi-dimensional country review, this report identifies key areas for action and presents targeted action plans to kick-start reform. The report also provides a dashboard of monitoring indicators to support the reform agenda in the country.

Having achieved robust economic growth and remarkable macroeconomic stability over the past 15 years, Paraguay has set a course to become not only more prosperous, but also more inclusive by 2030. To deliver on its development ambition, the country will have to overcome a number of crosscutting constraints that limit progress towards widely shared improvements in citizen well-being, as identified in Volume 1 of the review. Putting Paraguay on a more inclusive development path requires co-ordinated actions to increase the capacity of the state to redistribute, to improve the delivery of public services, and to break the persistence of poverty and inequality across generations. This report discusses policy actions and priorities in three critical areas to make Paraguay’s development more inclusive. It presents in-depth analysis and recommendations to improve the effectiveness of social protection, the delivery of health services, and the formation of skills for all Paraguayans.

Paraguay has achieved strong and resilient growth and made progress across a range of development outcomes since it emerged from a prolonged period of economic and political instability in the early 2000s. In 2014, the country adopted its first National Development Plan, setting course towards an ambitious vision of the country’s future. To maintain the pace of economic growth and achieve more inclusive development Paraguay will need to overcome a number of institutional, economic and social constraints that challenge its development model. This first volume of the Multi-dimensional Review of Paraguay analyses the country’s development performance and presents the main constraints to the country’s development. It examines five broad areas, corresponding to the key areas of the Sustainable Development Goals: prosperity, people’s well-being, planet, peace and institutions, and partnerships and financing.