Author/Editor:

International Monetary Fund. Western Hemisphere Dept.

Publication Date:

April 22, 2020

Electronic Access:

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Summary:

In March 2020, Paraguay was hit by the Covid-19 epidemic, which has created fiscal and balance of payments needs. The authorities’ policy response to the epidemic has been timely, but limited access to financing and a weakened fiscal position constrain the ability to pursue a deeper emergency response. Crisis response: To contain the epidemic and mitigate the impact on the private sector Paraguay has adapted an emergency package at a cost of about 2½ percent of GDP that will boost health care spending, expand the social safety net and provide emergency loans for small enterprises. It has also lowered policy rates, allowed banks to restructure loans to private sector companies that are in repayment difficulties, and postponed collection of taxes and user fees for 2 months.

Series:

Country Report No. 20/127