Paraguay Is #80

Paraguay is #80 in Economic Freedom out of 176 Countries.

Every year the Heritage Foundation, a leading U.S. nonprofit, produces the Index of Economic Freedom Report and ranks how free and open each country’s economy is.

With a score of 60.1, Paraguay is classified as "Moderately Free":

When it’s about soccer, every Paraguyan desperately wants to be #1. We need that passion where it really counts:

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More About Economic Freedom

What Does Being “Moderately free” Mean for Paraguay?

Paraguay’s classification as "Moderately Free" on the Index of Economic Freedom reflects a relatively open economy with opportunities for growth but also highlights certain restrictions and inefficiencies that limit full economic liberty. For the average Paraguayan, this classification means access to some economic freedoms but also the persistence of government inefficiencies and regulatory barriers that restrict economic advancement and job flexibility.

What categories doES Paraguay DO well in?

To do well ("mostly free") a country must score 70 - 79.9. To classify as excellent ("free") a country must score 80 or higher. Ecuador scores relatively well in these areas (scores out of 100):

Tax Burden 96.0
Government Spending 81.6
Trade Freedom 77.2
Investment Freedom 75.0

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Paraguay's worst 3 categories:

Government Integrity 27.3
Judicial Effectiveness 37.2
Labor Freedom 39.8

Paraguay’s lowest-scoring category, Government Integrity, stands at 27.3 out of 100, reflecting significant issues with corruption and transparency in public institutions. This low score affects citizens by reducing trust in government, leading to inefficient use of public funds and limiting foreign investment, which could boost the economy. To improve government integrity, Paraguay could adopt stronger anti-corruption measures, promote transparent governance practices, and increase accountability for public officials.

Judicial Effectiveness scores 37.2 out of 100, indicating weaknesses in the country’s legal framework and difficulties in enforcing laws fairly and consistently. This low score impacts citizens by making legal recourse challenging and unpredictable, which can deter investment and make property and business ownership riskier. Reforms to improve judicial effectiveness could include judicial training programs, enhancing legal transparency, and ensuring that courts operate independently to better protect citizens’ rights.

Labor Freedom in Paraguay scores 39.8 out of 100, pointing to rigid labor market regulations that limit flexibility in employment practices. This low score means that employers and employees alike face constraints in hiring, firing, and adjusting to market demands, which can stifle job creation and limit wage growth. To improve labor freedom, Paraguay could consider easing employment regulations, supporting flexible work arrangements, and encouraging policies that adapt to changing economic conditions.

Paraguay's Economic Freedom over time:

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