Paraguay: Narcotics Hub Wracked By Corruption

Paraguay, which holds a presidential election on Sunday, is a small landlocked nation in South America where corruption and drug trafficking are rampant. It has been ruled for most of the past seven decades by the right-wing Colorado party.

Here are a few key facts about this nation of 7.5 million people.

Wedged between Bolivia, Argentina and Brazil, the overwhelmingly Catholic country has a porous border, making it a hub for drug traffickers.

The narcotics, mainly cannabis (which it also produces) and cocaine (mainly from elsewhere), move from Paraguay into Brazil or Argentina and from there are shipped to Europe.

Paraguay's drug trade has sparked a wave of killings, with an anti-mafia prosecutor, Marcelo Pecci, and a crime-fighting mayor, Jose Carlos Acevedo, killed within the past year.

Despite its fight against endemic corruption, Paraguay is ranked 137th out of 180 countries by Transparency International.

It has two official languages: Spanish and Guarani -- an Indigenous language spoken by 87 percent of the population.

Paraguay has been ruled in almost uninterrupted fashion since 1947 by the right-wing Colorado party.

The Concertacion coalition of center-left parties hopes to change that on Sunday, and opinion polls show a close race.

The Colorado Party has a reputation for corruption and Paraguay remains under the shadow of dictator Alfredo Stroessner, who ran the country with an iron grip from 1954 to 1989.

The only time Paraguay had a president who did not come from the Colorado Party was in 2008-2012 under former Catholic bishop Fernando Lugo.

He was removed after an impeachment trial, which was swiftly denounced as a coup by Argentina, Brazil, Uruguay and Venezuela.

In 2013, Horacio Cartes -- one of Paraguay's richest men -- brought the Colorado Party back to power.

President until 2018, he was hit with sanctions for graft by the United States in 2022 along with current Vice-President Hugo Velazquez.

The party's presidential candidate this time, Santiago Pena, a 44-year-old economist and former finance minister, faces 60-year-old lawyer Efrain Alegre of the Concertacion coalition on Sunday.

Paraguay is a major exporter of soy beans, beef and hydroelectric power.

It has several dams, including the huge Itaipu on the Parana river -- the second biggest hydroelectric dam in the world in terms of production, after China's Three Gorges dam. Its operation has been the source of tensions with co-owner Brazil.

Paraguayan Stevia, a zero-calorie sweetener derived from the herb of the same name, has taken the global marketplace by storm.

With a low tax rate of no more than 10 percent, Paraguay is one of the few countries in the region to have seen an increase in foreign direct investment during the Covid pandemic.

The IMF predicts its economy will rebound by 4.5 percent in 2023 -- well above Latin America's average (1.6 percent).

But poverty affects 24.7 percent of the population, notably in its crowded slums on the banks of the Paraguay River in the capital Asuncion.

Paraguay is one of only 13 countries that officially recognize Taipei over Beijing, which claims self-ruled Taiwan as part of its territory, to be seized one day.

Latin America has been a key diplomatic battleground for China and Taiwan since the two split in 1949, but several of its nations, most recently Honduras, have switched diplomatic recognition to Beijing in recent years.

Alegre, the opposition presidential candidate, has suggested he would consider switching recognition to Beijing if elected, as relations with Taiwan mean being denied access to the huge Chinese market.