Paraguay, one of the world’s fastest growing economies, needs to invest $16bn during the next five years to maximise the country’s economic potential, according to the country’s Ministry for Industry. The small, landlocked Latin American country – with a population of 6.7 million and a GDP of $29.5bn – experienced economic growth of a staggering 13% in 2013, and the International Monetary Fund forecasts that it will grow by 4.8% this year. The Ministry for Industry says the average annual growth rate has been 5.5% during the past decade.

The government of president Horacio Cartes – who represents the centre-right Colorado Party and who took office on August 15, 2013, for a five-year term – is committed to an ambitious infrastructure programme, centred around private public partnerships. Among the main themes of Mr Cartes’s presidential campaign were promises to raise private capital to upgrade the country's infrastructure, to modernise its public enterprises and to attract international investment.

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“This is an excellent moment for Paraguay,” Oscar Stark, the country’s vice minister for industry, told fDi Magazine at the Latin American Trade and Investment Association conference in London on May 7, 2014. “The economy is expanding rapidly on the back of a great crop harvest. The government is determined to markedly increase public and private investment to help modernise and diversify the Paraguayan economy.”

The government plans to put out to tender several vital infrastructure projects this year. The most important is a $400m project to upgrade and run two of the country’s main roads, including the 330 kilometre stretch between Asunción, the capital, and Ciudad del Este, the country’s second city close to the Brazilian border. This would involve increasing the number of lanes on both sides of the road to two, and would operate as a 30-year concession.

The administration would also like to put out to tender this year a $100m to $150m project to upgrade the country’s main international airport, Silvio Pettirossi, in Asunción and a $100m project to run a hydrofoil service on the rivers Paraná and Paraguay. In particular, the hydrofoil would help soya farmers in the Brazilian state of Mato Grosso to transport their crop to the Atlantic ocean (currently, they face high costs in Brazil to do this).

Paraguay only uses 20% of its available hydroelectric energy supply. The government says the country needs to invest $5.4bn over the next 10 years to build a better generation, transmission and distribution system, so that the whole country has a reliable supply. “Paraguay is very fortunate that it has access to electricity from the Itaipú and Yacyretá dams,” says Mr Stark. “However, the country is under-utilising this incredible resource, which is vital to strong industrial growth.”

The government says up to 30 international firms are interested in being members of the consortia behind the projects. Ratings agency Moody's lifted Paraguay's credit rating to Ba2 in February, praising lower debt ratios, recent fiscal reforms and political stability.

Mr Stark says the controversial impeachment of former president Fernando Lugo in 2012 has not affected the country’s attractiveness to international investors.