Paraguay - Country Partnership Framework for the Period FY2027-2034 : Annex 2 - Financing and Implementation Arrangements

Overview & Synopsis

Paraguay is operating under tight fiscal constraints and institutional capacity challenges despite recent improvements in public financial management, while aiming to accelerate private sector-led growth, expand quality infrastructure and services, and strengthen resilience to climate and social risks. In the coming years, the World Bank Group will deploy a coordinated One World Bank Group approach that integrates financing with advisory and analytical support to catalyze private investment, with a strong focus on transport and logistics, energy and power, connectivity, and sustainable infrastructure to enhance market access and reliability of services. Priority will be given to climate resilience and green growth through initiatives such as smart agriculture, sustainable forestry, riverfront resilience, and renewable energy, while de-risking tools and guarantees will be used to crowd in private capital and mobilize foreign investment. The Bank will support a healthier and more skilled workforce by advancing quality improvements in education and strengthening access to health, nutrition, and population services to boost human capital and employability. To expand private sector opportunities and job creation, efforts will target agribusiness, forestry, energy, logistics, and textiles, alongside increased access to finance for Micro, Small and Medium enterprises and broader financial inclusion, leveraging public private partnerships and upstream support to improve project bankability, corporate governance, and environmental and social practices. Complementary policy and institutional work will emphasize domestic resource mobilization in coordination with the International Monetary Fund, development of sector policies, pension reform analytics, and labor market programs. To improve delivery, the Bank will help streamline project preparation and execution, strengthen procurement and fiduciary systems, reinforce portfolio monitoring and supervision, and enhance environmental and social risk management capacity. Collaboration with partners including the Inter-American Development Bank, Banco de Desarrollo de America Latina y el Caribe, the International Monetary Fund, and specialized agencies will underpin implementation, while ongoing dialogue with authorities and stakeholders will allow adaptive course corrections to sustain impact throughout the Country Partnership Framework period.