PARAGUAY Opportunities of Investment PARAGUAY Opportunities For Investment

PARAGUAY Opportunities of Investment PARAGUAY Opportunities For Investment Haga clic para cambiar el estilo de título Ministry of Foreign Affairs (MOFA) June, 27 th, 2006 de subtítulo Haga clic para modificar el estilo Republic of Taiwán del patrón Presented by Raúl Cano Ricciardi Viceminister of Commerce Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment MACRO ECONOMIC STABILITY PARAGUAY GDP per capita Population (1, 000 people) Haga Inflation (%) clic 2002 2003 2004 2005 934 998 1. 223 1. 323 5. 516 5. 670 5. 701 5. 798 para cambiar el estilo título 14, 6 de 9, 3 Domestic deficit or surplus (Mill. US$) Haga clic para Exports (Mill. US$) Imports (Mill. US$) 31 9, 9 105 124 modificar el estilo subtítulo 950, 6 de 1. 241, 5 1. 625, 6 del patrón 1. 510, 2 1. 835, 3 2. 651, 7 Intl. Monetary Reserves (Mill. US$) Source: Banco Central del Paraguay. Unemployment Rate 162 2, 8 1. 658, 7 3. 040, 9 641 983 1. 168 1. 297 2001 2002 2003 2004 21, 9 16, 4 12, 4 10, 9 Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment During the last three years, the economic growth was sound, foreseable and stable. 6 Average: 0, 85% 5, 5 Average: 3, 5% Haga clic para cambiar el estilo de título 3, 8 4 4, 1 3, 0 2, 7 2, 1 Haga clic para modificar el estilo de subtítulo 2 0, 6 0, 4 del patrón 0, 0 0 1995 -2 -4 1996 1997 1998 1999 2000 2001 2002 2003 2004 -1, 5 -3, 3 Source: Informe Económico del Banco Central del Paraguay – December 2005. - Ministerio de Hacienda. Ministry of Industry and Commerce 2005

PARAGUAY Opportunities of Investment The financial system presents important signs of a higher trust rate in the paraguayan economy. The growing use of the Guaraní in the financial system reflects the exchange rate stability. Haga clic para cambiar el estilo de título Haga clic para modificar el estilo de subtítulo del patrón Deposits Credits Arrears Ministry of Industry and Commerce Source: Informe Económico del Banco Central del Paraguay – December 2005.

PARAGUAY Opportunities of Investment ¿WHY PARAGUAY? Optimal Investment Conditions : * Strategic Location Haga clic para* cambiar el estilo de. Available título Young Labour Force * Low Tax Burden Haga clic para modificar estilo de. Energy subtítulo * Availableel. Electrical at Low Cost * Adel Bigpatrón Hydrographic Basin * Ideal Climate and Fertile Soil Available Key Tools for Investment in Paraguay Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment STRATEGIC LOCATION Market Access Haga clic. Lapara Paz cambiar el estilo de 2 h. 40’ Haga clic Export título. Gateway Iquique Sao Paulo 1 h. 15’ 2 h. 30’ Asunción para modificar el estilo dedelsubtítulo Ciudad Curitiba 50’ Santiago Este 2 h. 45’del patrón Montevideo 1 h. 40’ Buenos Aires 1 h. 20’ MERCOSUR 235 MM People Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment YOUNG AND TRAINABLE LABOUR FORCE Haga clic para cambiar el estilo de título Haga clic para modificar el estilo de subtítulo del patrón 70% of its population SOURCE: DIRECCIÓN GENERAL DE is below 30 years old ESTADÍSTICAS, ENCUESTAS Y CENSO TOTAL POPULATION 2005 POPULATION BELOW 30 YEARS OLD ECONOMICALLY ACTIVE POPULATION 5. 920. 837 4. 144. 586 2. 664. 377 Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment LOW TAX BURDEN New Tax Law 2421/04 * Corporate Income Tax 10% (2006) * Personal Income Tax 10% (2006) Valuecambiar Added Tax (IVA) de 10% Haga clic* para el estilo título Haga clic Tax Burden 23% 21, 4% 20, 4% 21% 18, 6% para modificar el estilo de subtítulo 17, 0% 19% 17% del patrón 14, 5% 13% 9, 9% 11% 9% 7% 5% Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment HIGH ELECTRICAL ENERGY AVAILABILITY Hydroelectrical Energy: clean and sustainable 10. 000 8. 000 6. 000 Haga clic para cambiar el estilo de título GW 4. 000 2. 000 Haga clic para modificar el estilo de subtítulo 0 1995 del patrón Available Demand 1985 2000 2005 2010 SOURCE: ADMINISTRACIÓN NACIONAL DE ENERGÍA ELÉCTRICA YEAR SUPPLY (GW) DEMAND (GW) 2005 2010 7. 410 9. 110 1. 266 1. 531 Ministry of Industry and Commerce AVAILABLE (GW) 6. 045 7. 579

PARAGUAY Opportunities of Investment ELECTRICAL ENERGY AT LOW COST Mercosur Tariff Comparison (US$/MW) Haga clic para cambiar el estilo de título Haga clic para modificar el estilo de subtítulo del patrón TARIFF USD/MW ANDE (PY. ) AVERAGE SOURCE: ADMINISTRACIÓN NACIONAL DE ENERGÍA ELÉCTRICA (ANDE) DIFFERENCE (%) Industrial 11 38, 4 -71% Home 44 82 -46% Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment A BIG HYDROGRAPHIC BASIN Haga clic para cambiar el estilo de título Paraguay Haga clic para modificar el estilo de subtítulo shares the del patrón biggest fresh water deposit in the world: The Guarani Aquifer Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment A BIG HYDROGRAPHIC BASIN Haga clic para cambiar el estilo de título Haga clic para modificar el estilo de subtítulo del patrón Plenty of rivers, lakes and water courses throughout the country Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment IDEAL CLIMATE AND FERTILE SOILS Western Region Temperature: Haga clic para cambiar el estilo de título * Máx. average 32, 5ºC * Min. Haga clic para modificar el estilo deaverage subtítulo 19, 2ºC del patrón * Anual Average 25, 2ºC Rain average: * 594 mm SOURCE: DIRECCIÓN DE METEOROLOGÍA E HIDROLOGÍA DE LA DIRECCIÓN NACIONAL DE AERONÁUTICA CIVIL Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment IDEAL CLIMATE AND FERTILE SOILS Eastern Region Temperature: Haga clic para cambiar el estilo de título * Máx. average 29, 4ºC * Min. average 19, 2ºC Haga clic para modificar el estilo de subtítulo del patrón * Anual Average 24, 3ºC Rain average: * 1420, 3 mm SOURCE: DIRECCIÓN DE METEOROLOGÍA E HIDROLOGÍA DE LA DIRECCIÓN NACIONAL DE AERONÁUTICA CIVIL Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment IDEAL CLIMATE AND FERTILE SOILS Paraguay is far away from Natural Disasters Haga clic para cambiar el estilo de título Haga clic para modificar el estilo de subtítulo del patrón Natural Disasters Around the World SOURCE: US Geological Survey Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment KEY TOOL FOR ENCOURAGE INVESTMENTS: l OUTSOURCING: MAQUILA PROGRAM l LAW 60/90 Haga clic para cambiar el estilo de título l FREE ZONES Haga clic para modificar el estilo de subtítulo del patrón Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment AVAILABLE KEY TOOLS FOR INVESTMENT HQ: Hiring Haga clic para cambiar el estilo Sub-Maquila: de título Corporation from abroad Undertakes partial processes Haga clic para modificar el estilo de subtítulo del patrón Maquila (PARAGUAY) Export Market: Tangible goods and untangible services Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment Outsourcing: MAQUILA REGIME Benefits: Duties and Internal Taxes Waived: * Temporary Import of Capital Goods, Raw Material, Parts and Components. MARGINAL BURDEN: Haga clic. TAX para cambiar * (1% over Invoicing) el estilo de título Haga. MERCOSUR clic para modificar el for estilo de subtítulo S&D R. O. O Paraguay REGIONAL del patrón. YEAR CONTENT 40% 50% 60% Until 2008 2009 - 2014 2015. . . Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment l Law 60/90 Investment Encourgement Benefits: l Duty Free for Capital Goods l Value Added Tax (10%) waived For New Investments Haga clic para cambiar el estilo de título l Tax waived for Principal and Dividends Payouts for Investment > 5. 000 USD Haga clic para modificar el estilo de subtítulo del patrón Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment FREE ZONES Main Benefits: • Duty Free as well as Internal Taxes are waived • Types of Free Zones: Haga clic para cambiar el estilo de título Industrial, Commercial and Services Haga clic para modificar el estilo de subtítulo del patrón Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment BUSINESS OPPORTUNITIES IN PARAGUAY 1 - Heart of Palms 2 - Floriculture Haga clic para cambiar el estilo de título 3 - Freshwater Shrimps 4 - Biofuels Haga clic Plants para modificar el estilo de subtítulo del patrón Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment HEART OF PALMS The Heart of Palms (Palmito) is obtained from some species of original palms of the tropical forest. The “Pupunha” specie is perennial and can be Haga clic cambiar estilo de título productive forpara more than 10 elyears. Haga clic para modificar el estilo de subtítulo del patrón Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment HEART OF PALMS Business Proposal Production, industrialization commercialization of eco. Haga clic para cambiar eland estilo de título heart of palms of best quality aimed to export market. Haga clic para modificar el estilo de subtítulo del patrón INVESTMENT (US$) 1. 271. 117 Projection (5 th year) Anual Production (MT. ) 1. 620 Revenues (US$) Outcomes (US$) 2. 916. 000 1. 474. 157 Ministry of Industry and Commerce Anual IRR 37% Pay Back In Months 47

PARAGUAY Opportunities of Investment FLORICULTURE Comparative advantages for the production of ornamental plants. Haga clic para cambiar el estilo de título Main focus is oriented to: • Cut Flowers Haga clic para modificar el estilo de subtítulo • Foliage del patrón • Ornamental Plants Highly appreciated species in world markets Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment FLORICULTURE Business Proposal Production, storage and Haga clic para cambiar el estilo de título shipment of cut flowers, foliage and ornamental plants to Europe. Haga clic para modificar el estilo de subtítulo del patrón Projection (5 th year) Pay Back INVESTMENT (US$) 675. 000 Anual Production (units) Revenues (US$) Outcomes (US$) Anual IRR In Months 51% 50 20. 000 4. 040. 000 1. 930. 000 Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment FRESHWATER PRAWNS The Aquiculture World Production has experienced an intense growth during the last decades, in some fields, likeel estilo de título Haga clic para cambiar Freshwater Shrimps. This behavior is explained Haga clic para modificar with el estilo de subtítulo less and reducing natural del patrón resources as a result of illegal fishing and an increased worldwide demand of food. Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment FRESHWATER PRAWNS Business Proposal Rise and commercialization of fresh el Water Shrimps for export Haga clic para cambiar estilo de título market or / and local consumption (Fresh Frozen) Haga clic para modificar el or estilo de subtítulo del patrón Projection (5 th year) INVESTMENT (US$) 150. 000 Anual Production (MT. ) Revenu es (US$) Outcomes (US$) 25 140. 000 83. 000 Ministry of Industry and Commerce Anual IRR Pay Back In Months 32% 43

PARAGUAY Opportunities of Investment BIOFUELS: ETHANOL PLANT & BIODIESEL PLANTS Ethanol has a superior performance than gasoline, lower cost production and less gas emissions. Lax 2748/05 : Compulsory Mix with Renewable Source of Energy: Ethanol and Biodiesel. Internal Captive Market. Haga clic para cambiar el estilo de título Allow the Government on the basis of Availavility and Quality to do the Mix. Ethanol Recent Mixes: clic of para modificar el. Gasoline estilo of de 95 subtítulo 24%Haga for Gasoline 85 Octane - 18 % for Octane del patrón Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment ETHANOL AND BIODIESEL PLANTS Business Proposal Ethanol Plants. As raw materials are sugar cane and molasses suggested, alternated with manioc, sorghum or corns depending of conditions of raw materials, aimed to the Paraguay´s deficit market and to export worldwide. Internal Market Deficit: Under Current conditions Haga clic para cambiar estilo Volume: 20. 000 el Cubic Meters de título Value: 11. 500. 000 USD at 0. 57 USD cents/Lt Biodesel Plants, using alternatives feedstocks: Soybeans, Colza, Paraguay´s Coconut, Fat and even used Cooking Oils. Haga clic para modificar el estilo de subtítulo Internal Market Deficit at B-5 : del patrón Volume: 50. 000 Cubic Meters Value: 37. 000 USD at 0. 75 cents USD/Lt Exponential Worlwide Opportunities as Demand for Renewable source of Energy is soaring. Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment PARAGUAY AS A GATEWAY FOR MARKETS OPPORTUNITIES: • Core MERCOSUR Countries: Argentina, Brazil, Paraguay and Uruguay. • FTA in South. America: Chile, Bolivia, Colombia, Ecuador, Haga clic para cambiar el estilo de título Venezuela and Perú. • Preferencial Trade Agreement (PTA): India, SACU (Southern African Union) el estilo de subtítulo Haga clic. Customs para modificar del patrón Under Current Negotiations Agreements: PTA : Israel, Egypt and Marrocco. Ministry of Industry and Commerce

PARAGUAY Opportunities of Investment THANK YOU Haga clic para cambiar el estilo de título Haga clic para modificar el estilo de subtítulo del patrón Ministry of Industry and Commerce