[{"bbox": [119, 152, 1110, 234], "category": "Text", "text": "Actions taken under the Financing Agreement shall be implemented in accordance with the Paraguayan legislation in force and Paraguay’s international obligations. The same is unrelated to national positions in ongoing negotiations, nor does constitute recognition of internal regulations of other states or blocs of states."}, {"bbox": [110, 259, 530, 292], "category": "Section-header", "text": "## 1.3 Zone benefitting from the Action"}, {"bbox": [108, 305, 1006, 333], "category": "Text", "text": "The Action shall be carried out in Paraguay. The country is included in the list of ODA recipients."}, {"bbox": [108, 358, 358, 393], "category": "Section-header", "text": "# 2 RATIONALE"}, {"bbox": [108, 423, 259, 452], "category": "Section-header", "text": "## 2.1 Context"}, {"bbox": [119, 470, 1110, 602], "category": "Text", "text": "Paraguay's economy is relatively small, open and highly dependent on agricultural and livestock production. Favourable external conditions, investment in new technologies, modernisation of production systems and promotion of sustainability in production and industry, as well as stable macroeconomic policies have helped Paraguay in achieving solid economic growth and the reduction of poverty from 45% to 26% over the last two decades."}, {"bbox": [119, 615, 1110, 697], "category": "Text", "text": "Growth has slowed-down in recent years due to external factors, in particular the COVID-19 pandemic and recurrent droughts, which have affected agricultural and hydropower exports. 2022 closed with -0.3% growth, but as weather conditions normalised, Paraguay experienced an important growth of 4.5%⁴ in 2023."}, {"bbox": [119, 707, 1110, 868], "category": "Text", "text": "Paraguay has diverse ecosystems that play an important role in the environmental balance. They hosts a unique biological wealth and strong potential for carbon sequestration. The world's largest water reserve, called the “Acuifero Guarani” (Guarani aquifer), lies under Paraguay and extends into parts of Brazil and Argentina. Paraguay share the overall responsibility for preserving this essential resource with neighbouring countries. It also leads the generation of renewable electricity per capita and is one of the first exporters of renewable electricity."}, {"bbox": [119, 879, 1110, 1014], "category": "Text", "text": "Between 2004 and 2021 the Paraguayan economy, with an average annual GDP growth of 3.8%⁵, has been among the five fastest growing economies in Latin America and the Caribbean. This growth was based on the extensive use of its abundant natural resources, especially land for agribusiness and livestock and water for hydroelectric production. This growth was based on sustainable agricultural and agro-industrial production, with an energy matrix of almost 100% renewable."}, {"bbox": [119, 1024, 1110, 1264], "category": "Text", "text": "The country's total forest cover area at the end of 2022 was 17,727,756.6 hectares, equivalent to 44.3% of the national territory, between 2005 and 2022 there was a loss of forest cover of 5,373,558.7 hectares, of which 88.2% were recorded in the Western region and 11.8% in the Eastern region. The annual rate of land use change between 2005 and 2022 is 316,091.7 hectares on average, which remains on a downward trend, as mentioned in “Our Forests” (INFONA, 2022). According to the World Forestry Watch the percentage of forest cover loss during the period 2002-2023 reached 29%, one of the highest in theregion. The Zero Deforestation Law of 2004, renewed for 10 years in 2021, prohibits land use change in the Eastern region of Paraguay, in the West/Chaco region land use change is allowed provided that at least 25% of forest area is retained on each property."}, {"bbox": [119, 1275, 1110, 1383], "category": "Text", "text": "Paraguay is particularly vulnerable to the impacts of climate change. The Notre Dame Global Adaptation Initiative (ND-GAIN) climate vulnerability index ranks Paraguay 93rd out of 185 countries from least to most vulnerable⁶. Paraguay is also a Landlocked Developing Country (LLDC). With respect to LLDCs, the United Nations Framework Convention on Climate Change specifically indicates that their specific needs"}, {"bbox": [108, 1541, 356, 1566], "category": "Footnote", "text": "⁴ Central Bank of Paraguay"}, {"bbox": [108, 1565, 529, 1590], "category": "Footnote", "text": "⁵ Statistical Annex to the economic report, BCP."}, {"bbox": [108, 1589, 583, 1615], "category": "Footnote", "text": "⁶ https://gain.nd.edu/our-work/country-index/rankings/"}, {"bbox": [1013, 1681, 1122, 1706], "category": "Page-footer", "text": "Page 5 of 30"}]