Investment opportunities in Paraguay

0% of total country territory Suitable Land

Paraguay has large areas of land suitable for landscape restoration of high productivity. Recent studies show that 45% of the country territory has po-tential for forest landscape systems.

over 0million m³/yr Unmet Demand

Total wood demand in Paraguay amounts to 12 million cubic meters per year. As supplies cover only one third of this, there is a gap of 8.8 million cubic me-ters per year that the country needs to import.

up to 0Jobs/1000ha Social Impact

Forest landscape systems do wonders to create jobs along the entire value chain from nurseries to processors. While cattle ranching creates between 3-5 jobs per 1000 hectares, forest landscapes generate employment benefits of up to 45 jobs on the plot of land.

0million $/year Investment Requirement

The Paraguayan NDC outlines the country’s climate targets. If one were to achieve these targets solely by commercial reforestation, 290,492 hectares would be needed per year. Assuming 1,200 USD per hectare initial investment cost, large scale private investments are required.

Building a business case for native timber species

Under the IKI-Initiative “Upscaling private Forest Landscape Restoration investments in Latin America”, UNIQUE and its partners are piloting the use of native species in commercial forest plantations in Paraguay.

Publication
“Manual técnico de producción de semillas de árboles nativos para la restauración de paisajes forestales”

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Paraguay: Why You Should Get Involved

Economic opportunities

Paraguay has achieved impressive economic growth over the past decades. The country ranks first in the Forestry Investment Attractiveness Index, which evaluates growth potential in the forest sector across Latin America. Slowly rising wood prices and room for value chain improvements offer immense investment opportunities. Land owners are looking for investment to diversify production away from traditional annual crops to climate resilient production systems such as commercial forestry.

Environmental benefits

Expansion of agriculture and livestock have historically led to massive deforestation and biodiversity loss in Paraguay. Forest landscape restoration investments are emerging as a promising strategy to counteract this trend and buffer the increasing frequency and severity of extreme weather events such as flooding and heat waves. In short, forest landscape restoration generates high climate risk adjusted returns and delivers ecosystem benefits such as soil improvement, water retention and biodiversity protection.

Social wellbeing

Paraguay has seen rapid improvements in quality of life, access to education, and life expectancy over recent decades, but many indigenous and rural communities have not benefitted from this trend. In the absence of an agrarian reform, subsistence farmers have been largely neglected. Inequality has spurred conflicts over land and created social unrest. Forest landscape restoration investments can reduce rural poverty by creating long-term, quality jobs where they are most needed.

Institutional security

The Paraguayan government has created a suitable enabling environment for forest landscape restoration investments, for example through a USD 40 milion budget line for concessional loans issued through banks. Halting deforestation as well as increasing planted forest area are part of the country’s national climate strategy. Laws prohibit deforestation in Western Paraguay and limit it in the Chaco. Paraguay grants tax breaks, full repatriation of profits, and national treatment for foreign investors.