Paraguay (pâr´əgwā, –gwī, Span. pärägwī´), officially Republic of Paraguay, republic (2005 est. pop. 6,348,000), 157,047 sq mi (406,752 sq km), S central South America. Paraguay is enclosed by Bolivia on the north and west, Brazil on the east, and Argentina on the south and west; Bolivia and Paraguay are the two landlocked nations of the continent. The capital and by far the largest city is Asunción.
The eastern part of the country, between the Paraguay and Paraná rivers, where most of the population lives, is a lowland, rising in the east and north to a plateau region. The region was once heavily forested, but forest land has been steadily depleted. The Paraná, south of the Iguaçu River (with its magnificent falls), separates Paraguay from Argentina. The Paraguay River also forms part of the border with Argentina, from its confluence with the Paraná north to the Pilcomayo River. The section west of the Paraguay River is a dry plain, part of the Chaco (see Gran Chaco). Cattle are raised and quebracho is found in the woodlands of the Chaco Boreal. All the important cities are in the east. Besides Asunción, they are Villarrica, Concepción, and Encarnación.
The population is largely mestizo, of mixed Spanish and Guaraní descent. Spanish and Guaraní, which is spoken by most of the population, are the official languages. The Jesuit missions (the reductions, active from the late 16th to the 18th cent.) were instrumental in the blending of Spanish and Guaraní cultures. Later immigrants—German, Italian, and French, and most recently Brazilian and Japanese—added new elements to the distinctive civilization of Paraguay. The country's arts and handicrafts reflect the various strains. A notable musical contribution is the guaranía, a form developed from native melodies by José Asunción Flores during the Chaco War. Nanduti (spider web) lace is the most famous Paraguayan handicraft. The isolated indigenous groups that live in the Chaco and elsewhere have little part in the national life. Roman Catholicism is the established religion; most of the small number of Protestants are Mennonites.
About half of Paraguay's workers are engaged in agriculture and forestry; a much smaller percentage are employed in industry and mining, and many work outside the formal economy. The principal crops are cotton, sugarcane, soybeans, corn, wheat, tobacco, cassava, fruits, and vegetables; cattle and other livestock raising is also important. Orange groves furnish petitgrain, used in perfumes and flavorings. In addition to quebracho, hardwoods and cedars are commercially exploited. Meatpacking, sugar processing, textile and wood-products manufacturing, and the production of steel and consumer goods are the main industries. The country also has a large underground economy that encompasses smuggling, money laundering, and trafficking Andean cocaine.
Paraguay has minimal road and rail systems, and river transportation is the primary means of moving goods. Hydrovía, a proposed waterway to straighten and deepen the Paraná, was approved by Paraguay, Bolivia, Argentina, Brazil, and Uruguay in 1994, but environmental concerns have slowed implementation of the plan. The Itaipú Dam on the Paraná River, completed in 1991, is one of the world's largest, and the electricity it generates is economically vital to Paraguay as a source of export income and nearly all the nation's electricity. The Yacyretá hydroelectric project, also on the Paraná, was inaugurated in 1998.
The leading exports are soybeans, feed, cotton, meat, edible oils, electricity, wood, and leather. The leading imports are vehicles, consumer goods, tobacco, petroleum products, and electrical machinery. Paraguay is a member of Mercosur; its main trading partners are Brazil, Uruguay, Argentina, and China. Customs duties furnish an important part of the country's revenues, but are significantly undercollected due to smuggling.
Paraguay is governed under the 1992 constitution. The president, who is both head of state and head of government, is popularly elected to a five-year term and cannot be reelected. The legislature has two houses, the 45-seat Chamber of Senators and the 80-seat Chamber of Deputies. Members of both are popularly elected for five-year terms. The two main parties, both conservative, are the Colorado party, which has governed almost exclusively since 1947, and the Authentic Radical Liberal party. Administratively, the country is divided into 17 departments and the capital city.
European influence in Paraguay began with the early explorations of the Río de la Plata. Juan Díaz de Solís was the first to come (1516), and Sebastian Cabot followed him (1527) to the Paraguay River, which was thought to offer access to Peru. One of the main reasons for the voyages (c.1535) of Juan de Ayolas and Domingo Martínez de Irala was to seek a way across the continent. A colony grew up, as Asunción became the nucleus of the La Plata region. Irala dominated the colony until his death (1556 or 1557) and clashed with Álvar Núñez Cabeza de Vaca.
At the end of the 16th cent. Hernando Arias de Saavedra, called Hernandarias, became governor of Río de la Plata prov., of which Paraguay was a part; it was through his efforts that the administrations of present Argentina and Paraguay were separated (1617). The Jesuit missions were founded in the days of Hernandarias (most of them in the trans-Paraná area, now in Argentina). Real independence from Spain was asserted when in 1721 José de Antequera led the comuneros of Asunción in a successful revolt and governed independently for some 10 years. In 1776 the region was made part of the viceroyalty of the Río de la Plata.
Manuel Belgrano was unsuccessful in carrying the Argentinean revolution against Spain into Paraguay in 1810, but the next year the colonial officials there were quietly overthrown. In 1814 the first of the three great dictators who were to mold Paraguay came to power. He was José Gaspar Rodríguez Francia, the incorruptible, harsh, and autocratic dictator known as El Supremo, who kept Paraguay in the palm of his hand until his death in 1840. He was succeeded by another dictator, Carlos Antonio López, who held absolute power from 1844 to 1862. His son, Francisco Solano López, succeeded him and brought on disaster by involving Paraguay in war with Brazil, Argentina, and Uruguay (1865–70; see Triple Alliance, War of the). The Paraguayans fought heroically and sustained the loss of more than half the population.
Recovery from the catastrophic war was slow, and the desperate state of the economy was matched by political confusion, as warring caudillos established short-lived dictatorships. Nevertheless, in the late 19th and early 20th cent. conditions improved. Trade increased as Paraguayan products found markets, immigration was encouraged, and farming and modest little industries prospered fitfully. The unsettled boundary with Bolivia, however, turned from an irritation into a threat, and in 1932 Paraguay plunged into another major war—the Chaco War (see under Gran Chaco), which lasted until 1935. From it the little country emerged victorious but exhausted.
The rapid succession of governments afterward was broken by the years when Higinio Morínigo was in power (1940–48). Signs of recovery from the Chaco War appeared in improvements in education, public health, and roads, but the oppressive dictatorship of Morínigo was challenged by numerous uprisings. He was overthrown in 1948, and the country was again subjected to a series of short-lived governments.
The Stroessner Regime and Its Aftermath
Gen. Alfredo Stroessner engineered a successful coup in 1954 and stayed in power by repeatedly suppressing opposition. He was elected president in 1958 and 1963; the 1967 constitution permitted him to be reelected numerous times. Under his rule the national economy improved and financial relationships with other countries were strengthened. Although Stroessner was elected in 1988 for an eighth term, Paraguayans wearied of his domineering administrative style. He was overthrown in a coup in Feb., 1989. The coup leader, Gen. Andres Rodríguez, was elected president, and he gradually began moving the country away from its authoritarian past.
In 1993, Juan Carlos Wasmosy of the governing Colorado party won the presidency, but his power was weakened by a divided legislature, labor strikes, and the demands of farmers for more equitable land distribution. In Apr., 1996, an apparent military coup by the army chief, Lino Oviedo, was averted. When Oviedo became the presidential candidate of the Colorado party in 1997, however, Wasmosy had him arrested on charges of insubordination in the 1996 dispute. Oviedo was sentenced to 10 years in prison; his running mate, Raúl Cubas Grau, replaced him and won the 1998 election. Wasmosy was later (2002) convicted of corruption because of his role in a bank scandal during his presidency.
Shortly after taking office Cubas freed Oviedo, and later ignored a supreme court order to return the former general to prison. A bitter power struggle developed between Cubas and his vice president, Luis María Argaña, who was killed in a street ambush in Mar., 1999. Following several days of rioting, Cubas was impeached on charges of misuse of public office; he resigned and fled to Brazil, returning in 2002 to face charges arising from the assassination. Oviedo fled to Argentina but disappeared in December, claiming to have returned to Paraguay. The president of the senate, Luis González Macchi, became president, heading a government of national unity.
An attempted coup by supporters of Oviedo failed in May, 2000, and Oviedo was arrested the following month in Brazil. A special vice presidential election in August was narrowly won by the Liberal party candidate, Julio César Franco; it was the first national election lost by the Colorado party since it came to power in 1947. Franco benefited from the split within the Colorado party and had the de facto support of Oviedo.
González Macchi's coalition subsequently disintegrated as his opponents within the Colorado party and Franco's supporters sought to undermine the president. In 2001, Paraguay's request to extradite Oviedo from Brazil was rejected by the latter country's supreme court. Opposition to the president culminated in 2003 in an impeachment trial for corruption that González Macchi denounced as politically motivated; the president survived when his opponents fell short of the two thirds majority needed to convict him in the Paraguayan senate. In the Apr., 2003, presidential election, Óscar Nicanor Duarte Frutos, the Colorado party candidate, won; Franco placed second. Oviedo returned to Paraguay in June, 2004, and was promptly arrested and jailed, but he was released on parole in Sept., 2007, and his conviction was overturned the next month.
In 2006 former president Macchi was convicted of involvement in the illegal transfer in 2000 of Paraguayan central bank funds to the United States. He denied any involvement and blamed the central bank officials who had been convicted in 2004; his conviction was overturned on appeal. He was later convicted (2006) of fraud and embezzlement. Fernando Lugo Méndez, the former Roman Catholic bishop of San Pedro and a moderate leftist who was the candidate of an opposition coalition, was elected president in Apr., 2008, with about 41% of the vote. His victory ended more than six decades of Colorado party rule, but the Congress remained dominated by conservative parties. In September, Lugo accused his predecessor and former General Oviedo of being involved in a plot to overthrow him; they denied the accusation.
In Apr., 2009, Lugo's reputation was damaged when he was forced to acknowledge that he had fathered a child while a bishop. There were accusations that he had additional children with other women, and he eventually acknowledged having a second child. Brazil agreed in 2009 (ratified 2011) to triple payments to Paraguay for exported electricity generated by the Itaipú Dam. In 2010, attacks by leftist guerrillas led in April to the imposition of a 30-day state of emergency and military rule in N Paraguay, but no significant progress against the guerrillas resulted. Lugo, who had alienated both his leftist supporters and more conservative Liberal party allies, lost support in the Congress after a land eviction by police in June, 2012, led to violence and 17 deaths, and he was quickly impeached and removed from office by both his Colorado opponents and former Liberal allies. Federico Franco Gómez, the vice president and a Liberal, succeeded Lugo as president. Mercosur suspended Paraguay for a year in response to the impeachment. Horacio Cartes Jara, a wealthy businessman and the Colorado party candidate, was elected president in Apr., 2013.
See T. E. Weil et al., Area Handbook for Paraguay (1972); C. J. Kolinski, Independence or Death: The Story of the Paraguayan War (1965) and Historical Dictionary of Paraguay (1973); C. A. Washburn, The History of Paraguay (1871, repr. 1973); P. H. Lewis, Paraguay Under Stroessner (1980) and Socialism, Liberalism, and Dictatorship in Paraguay (1982); R. A. Nickson, Paraguay (1987).