Para-Para-Paraguay

OnTheBall Travels (Paraguay)

From Uruguay, we headed to Paraguay seeking to check the place out if it could be a Plan B or even Plan A destination.

Itinerary

We flew from Montevideo to Asuncion using Paranair. I can’t recommend Paranair enough given that the man there allowed us to check our carry-on bags and shuffle things around so that we would avoid a charge of 120 USD (!). He even set ours as priority (for some reason?). We heard a similar approach being taken for an old man who had a space problem with his carry-on, too. They were very friendly as well and the flight was on perfect time. The plane was a two-seater Bombardier CRJ 2000, but oddly we found it had more leg room than the Boeings on the large airliners.

We walked into the airport and went straight to the immigration official who took our photos, asked what we did for a living and where we were going to be staying. It felt like more of a “this is what I have to do” rather than “I don’t trust you and I want your private information!”

Immediately we received our bags, and picked up an Uber to where we were staying in Recoleta (region in the city). Smooth process. We were also in Ycua Sati. Even here we can see further construction and lots of high-end apartments.

Interesting Facts To Start

Credit Cards are widely accepted; everywhere. I know a lot of my readers may hate this, but it does make payments easier sometimes if you’re out of cash. Cash is still widely accepted or encouraged, too.
Sometimes they mix Spanish with their other official language, Guarani (also the name of the indigenous people and their money) when speaking. It is the only country who’s government recognizes an indigenous language.
One way to distinguish an upper class citizen is that they may not speak the local indigenous language. Why? Because when they go to a private school they are taught in English or Portuguese instead. They may know it as much as Americans know High School Spanish or Canadians know French; but Spanish is their go-to. Lower class citizens will speak Spanish professionally and Guarani casually.
Horacio Cartes, the former President of the country is widely recognized as the real controller of the country. It’s been remarked that the country is run by 5 families, but certainly his family is one those. He owns a significant amount of the real estate, land, tobacco, and many have accused him of trafficking marijuana and cocaine as well. It’s thought that the currently President is a relatively pro-business character as well, who takes orders from Cartes.
San Bernardino, a place that I really liked for it’s cleanliness, huge houses, quiet atmosphere, clubs along the lake apparently was founded by 5 Nazi families. In fact, there are major rumours that speculate Hitler spent a lot of time here and is now buried in Calle España in Asuncion. It is confirmed that Joseph Mengele was a doctor in Paraguay in Asuncion and that Hitler’s daughter had also lived in Asuncion. In San Bernardino you can see many German flags and Germans populate the country far more than Argentines populate Argentina.

What Brings People to Paraguay?

Paraguay has some of the lowest taxes in all of South America. They are one of the few countries on the planet who do not tax foreign income, meaning if you have a stock portfolio from outside of the country and sell/receive dividends from abroad, you won’t pay tax in Paraguay. On domestic income, it is taxed at 10%. There is an exception on the first 10,000 USD (approximately) of domestic income; thereafter the rate is 10% for the most part. There are rates that are 8 and 9% but it’s nuanced whether this applies, the point is, is that if you’re reading this chances are it’s a lower rate than what you are currently paying.

Interestingly, An individual is deemed to be tax-resident in Paraguay if one spends more than 120 days in a year in the country. This is really great because it means that if you have to pay taxes somewhere, you can register as a tax resident more easily in Paraguay. Most countries expect you to have significant resources in the country or stay for 183 days. There are some exceptions like Cyprus, Isle of Man and Uruguay.

Paraguay is also relatively easy to possess a firearm compared to other countries (Panama is good in this respect as well). Paraguay offers an opportunity to possess your own private property away from the madness (“off the grid”) that other countries do not either.

Additionally, Paraguay has one of the smallest governments relative to their population in the world–the fact of the matter is you’re not going to receive government support or intervention on most matters. You take the bitter with the sweet on this one.

Allegedly, this is the first place Hitler stayed upon his escape to Paraguay.

Paraguay has one of the largest dams in the world as well and much of their energy is established through hydropower (which makes it a lot easier to hedge out risk of importing fuels; but they receive pretty cheap gas/oil from Brazil either way). The infrastructure is very poor however, so despite having ample amounts of energy, they often have power outages. Many locals have long-complained about the fact that this persists and a lot of the energy is exported to Argentina and Brazil who pay more money. If we’re thinking about truly awful times ahead, I view this as a major benefit because infrastructure can be completed to better recovery this energy, but a natural hydro electric plant cannot be created so easily.

Key Things Noticed

Prices are very low. The most groceries I have bought in years had come to under 100 USD. Compared to Mexican prices, I’d say it’s 40-60% cheaper than Mexico. Beer is 1.25 USD for a pint (or larger sometimes). I can say Paraguay is the cheapest country I have ever been.
The people are very kind and engaging. They will offer you help and smile even if there is a language barrier (or description/name barrier). Many have noticed my lack of Spanish or strange accents and they tend to take time to chat with you. We have been shocked when some have given us gifts for continually using their service.
There is considerable development ongoing. I am quite vocal about how fast areas of Mexico is growing but Asuncion is nothing but apartment/business construction AND I should say, they work 6 days a week. ‘Men cutting steel’ has been my alarm clock at 6:30AM and sometimes they work at night even without light. In fact, in my AirBNB I was looking at a building that the President built with his own money.

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It’s hot. We’re in winter and it touched 33 degrees. It may even touch 50 degrees in summer time. Air Conditioning is a must-have. Sometimes this is a deal-breaker.
Real Estate isn’t as cheap as you’d think given the fact that Argentines and Brazilians commonly use Paraguayan real estate as a safe haven for their capital.
Traffic–>sucks. It’s very congested and you have to plan 20-30 mins extra time going from one side of the city to another.
Asuncion is a city where there is the most amount of nature around that I have ever seen. There are far more trees than there are concrete buildings, somehow they’ve been able to keep the trees intact

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Something the doomsday crowd won’t admit. They love dollars. From the penthouse owner bank manager to the poor person selling jugo on the cracked sidewalk; they all quickly agree to accept dollars. They may even round down to give you a better deal.

Paraguay have some of the lowest exchange rate spreads on the US Dollar I have ever seen; they deal in so many currencies too.

Downsides

Paraguay is by far the poorest country I have been to in OnTheBall Travels. It’s capital city has about 4-5 regions, nearly adjacent to each other that you want to reside amongst which has some nicer apartments, cleaner streets, police/private security surveillance and less thug characters. Enough malls and grocery is nearby to sustain you and albeit quiet and dark, it doesn’t feel shady.

I cannot say the same for the rest of the city of Asuncion. Some areas resemble the inside of a public bathroom and I have witnessed many homeless treating it as such. Buildings are crumbling, untended for over 70 years, paint crumbling off the buildings, stray animals, vandalism everywhere and trash sitting on every broken sidewalk with shattered glass. The people who occupy the streets would be considered as extreme poverty by any definition. I have been in some very, very poor areas in Mexico (in places where people do a double take, “how did this gringo get so lost where he ended up here?”) and it doesn’t compare to some streets in the central Asuncion.

Needless to say, Paraguay is not as clean nor as modern as Uruguay or Argentina. The feelings of being in or surrounded by “Europe” are dissipating as the beautiful Spanish buildings age. Paraguay in many ways, is its own thing.

Further Disclaimer

Paraguay is completely a failed state. It has no rhyme of reason behind its governmental affairs; everything is at a whim or someones discretion, often manipulated one way or the other based upon how large (or absent) your bribe money is at the time. It is staggering how disconnected Paraguay’s immigration department is from the rest of their government agencies and especially those of foreign governments (via embassies). Do not expect anything to work smoothly here, that is, if you do not have the connections in the right places (Please see below regarding this).

I hate 2-FA with a passion and this hate was resurfaced here. I’ve had a difficult time having my phone connect to a local cell tower at one point. A Paraguayan number should fix this, in fact some Paraguayan phone plans are valid throughout some of Mercosur.

Paraguay may struggle to have a catalyst to propel it forward. I am still left with a feeling of great potential and lots of foreign investment in the years to come–however it lacks the fundamentals that require investment to not only enter–but to stay. Other than being a safe haven for their assets from their neighbours, I’m not clear if there will be an ‘event’ that makes Paraguay ready for their next stage of growth and stability.

Inflation has hit the country quite badly–not nearly as bad as Argentina however. For you coming, you’ll enjoy a cheaper local currency–but it is an example of the little matters of insecurity here.

Lastly, you can only withdraw 3,000,000 Guarani a day from ATMs which is about 388 USD. There are some ATMs that don’t have this limit set and Western Union are one way to circumvent this. For everyday spending, things are such a price that it may not be too bothersome however.

I have spoken to successful & smart people who are moving or seriously considering a move to Paraguay

Potential Catalysts For Paraguay

Downfall of Europe. South America is a fantastic place for Europeans escaping problems in Europe. World War 1 and World War 2 are great forms of evidence of this; World War 3 (I believe we are in it now) will be the same.
Growth; you make more money going from terrible to bad than you do from good to great. Given Paraguay’s situation and immense room for development, it could be a huge money maker yet. The ingredients are there and the government is hands off.
Safety. Paraguay is not as safe as the Cayman Islands or Hungary, but on a relative basis, it is much safer than the neighbouring countries. Paraguay does not have the same desperation to steal or commit crime as their bordering countries and it’s positioning/shape causes drug conflicts to be local. If we see a major exodus not only from Europe but the rest of the South America, this could bring huge amounts of spending and an economic boom necessary to take it to the next level of GDP. No large cartel organizations have a stronghold in the country.
Marketing; I will cover this in greater detail for the subscribers, but the reality is most people do not know about Paraguay and while there’s lots of tourism from Argentina and Brazil (you see it), very few head here. This could be out of ignorance to its existence!

A Money-Making Opportunity?

After evaluating the country, speaking to people, travelling about, we feel that there is a lot of potential in the country to become a next hub in South America.

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Who is Paraguay For?

Argentines looking to escape hyperinflation but aren’t going to struggle to afford the costs of life here (they can utilize Mercosur).
Expats/Digital Nomads
Entrepreneurs/Investors; but I stress, not by utilizing local assets. Paraguay prices give you an opportunity to spend the majority of your money on assets and your business to get it off the ground while saving a healthy amount of money on entertainment, food and rent.

Who is Paraguay Not For?

Retirees. Paraguay seems to be too hot in temperature for people
Healthcare and education is not the best; you will most certainly be downsizing by going to Paraguay from a so-called “developed” country. In other words, healthcare is a responsibility placed upon the individual & family, which again may make it a place not fit for retirees looking for a “system”.
Entrepreneurs/Businessmen; “I thought you said it was for them?” There is still a load of bureaucracy in this country and what is very worth mentioning is the level of corruption that exists. A bribe is the gravity that keeps transactions flowing properly but there’s a level of insecurity and unpredictability baked into the cake of operating here. Moreover, flights connect to Madrid, Panama, Buenos Aires and Montevideo; but it’s not as connected as other international cities.
To that effect, perhaps very wealthy people may want to seek more wealthy, secure, exclusive countries/areas. Uruguay is more stable in this respect, but you pay for it.

Irony

Ironically, the downsides of Paraguay make it a place that can be used as the ideal place for a World War 3 bunker as it were. The positives are great, cheap costs, lots of water, lots of food, access to firearms–but the fact that anything can be done with enough money or connections also makes it a place whereby “bad rules” in the most tyrannical sense during a World War-like event, will be easier to circumvent relative to other countries. I believe this may be difficult for some to understand, especially those from high-order societies.

Closing

Paraguay produces a lot of their own food, in far excess compared to their own domestic consumption– the fact of the matter is that the people are not going to starve down here amid tightening of food supplies around the globe. The idea of stopping meat consumption is comical.

I believe that I have just witnessed the early days of the serious emergence of Asuncion as being a large international city. There is a considerable amount of real estate development in the nicer areas of the city and a lot more space to go (a lot more trees to fall!). It’s not extreme to say that I think Asuncion (or Paraguay at large) can be a significant city/country in 15-20 years time.

Paraguay is relatively quiet, unknown, has very low taxes, lots of unexplored farmland, great gun laws and low costs for anybody looking to have a Plan B in their back pocket (with very minimal stay requirements).

All in all, Paraguay is on very high on my list of places to settle in as the pros outweigh the cons in my opinion. I think if you can overlook or manage the downsides, then it truly can be a great place to live happily and healthy.