Sustained economic growth since 2010, investor-friendly tax incentives, economic diversification, and the highest degree of monetary and fiscal stability in Latin America, are among the factors that have kept Paraguay relatively protected from the region’s recent difficulties – particularly those in Brazil and Argentina. The recent plunging of commodity prices has resulted in a slowing of growth, but the country nonetheless achieved a solid 3.0% expansion in 2015. Indeed, Paraguay’s economy is small but open, and currently heavily reliant on agricultural and energy production and foreign trade; however, it is slowly diversifying towards less volatile and more service-oriented sectors such as real estate, information and telecommunications. Despite dwindling commodity revenues, Brazil’s proximity offers countless trade opportunities, and the local maquiladora regime motivates many companies to open shop in Paraguay, including a large number of Brazilian firms. This optimistic climate has led to a healthy transactional market, particularly in the infrastructure sector, where investments have benefited from sustained government support. The country also launched a $600m, 10-year bond in the international markets, making it all the more visible to foreign investors.
As a result of Paraguay’s economic growth and the need to modernise the country’s legal framework, a growing number of legal professionals are engaged with proposed legislative changes in relation to conditions that they regard as obstacles to the country’s development – particularly in the labour and employment arena.
The Paraguayan commercial legal market tends to be dominated by full service –or certainly multidisciplinary firms– including Fiorio, Cardozo & Alvarado, Attorneys at Law, Moreno Ruffinelli & Asociados, Olmedo Abogados, Peroni Sosa Tellechea Burt & Narvaja and Vouga Abogados. Some like Estudio Juridico Gross Brown, Palacios, Prono & Talavera or Berkemeyer Attorneys & Counselors, have gained a certain market dominance in one sector or another – in this case: banking and finance, marine/maritime matters, and IP respectively– but none has secured a broader, more over-arching market leadership. With it international-style model, one firm that is increasingly threatening to do so is Ferrere; long regarded as, at best, a newcomer, the firm now has over 10 years in the market and, in terms of headcount, is currently the second largest firm in the jurisdiction. Moreover, there are other recent market entrants, such as Altra Servicios Juridicos, which are also seeking to gain their stake of the steadily increasing international work available. Boutique practices remain relatively rare but are nevertheless sometimes seen providing top-tier specialised legal services on a par with larger firms, particularly in IP (Zacarias & Fernández), tax (Estudio Nora Ruoti & Asociados), environment (SEA Abogados y Consultores Ambientales) and labour and employment (Irún & Villamayor Asesores Laborales de Empresa).