Afrigather Paraguay, a comparatively massive South American nation roughly the identical measurement because the U.S. state of California, has traditionally been overshadowed by its bigger and extra well-known next-door neighbors, Argentina and Brazil.
However all that is about to vary.
This landlocked nation of 6 million folks, usually confused with the equally sounding Uruguay, is about to change into the Silicon Valley of South America.
As the most important web exporter of fresh vitality on the earth—99.9 p.c of its electrical energy technology has zero carbon dioxide emissions—Paraguay has discovered itself in a key place because the tech world continues to hunt sources of ample, low-cost, and clear vitality wanted to energy the huge processing necessities of synthetic intelligence (AI).
Paraguay’s Itaipú and Yacyretá hydroelectric dams, shared with Brazil and Argentina respectively, generate huge quantities of renewable vitality, nearly all of which is exported for revenue to its bigger neighbors. And all this comparatively low value, renewable energy is attracting the eye of the world’s AI heavyweights, particularly Alphabet, Meta, Nvidia, and OpenAI, amongst others, with a number of already making main investments within the nation.
Newsweek not too long ago sat down with Paraguay’s President Santiago Peña, whereas he was in New York Metropolis, to speak about his nation’s rising position as a participant in AI.
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“I’ve visited San Francisco, the headquarters of all of the Massive Tech corporations, and we’re speaking with [Google, OpenAI, and others]. We’re additionally partnering with Taiwan [about developing] semiconductor and microchip manufacturing capability; we’re aiming to make Paraguay the technological hub for the area and the world … leveraging our low-cost electrical energy,” mentioned Peña, who, at age 45, is one among Latin America’s youngest heads of state.
However Paraguay’s emergence onto the worldwide tech scene is not solely attributed to its huge energy technology functionality. The nation’s public sector has additionally undergone vital financial and institutional reforms which have made it extremely enticing to worldwide traders. Inflation has hovered within the 4 p.c a 12 months vary. Its 10 p.c across-the-board flat tax on VAT, in addition to private and company earnings, has been lauded by company tax specialists worldwide. And a number of different authorized reforms, coupled with strong authorized protections for international capital, have made the nation an more and more fascinating goal for international funding throughout many sectors.
And Wall Road agrees.
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Only a few months in the past, Moody’s upgraded Paraguay’s credit standing to funding grade, citing its “strong and sustained financial progress and our expectations that the economic system has change into extra resilient to shocks, and a track-record of institutional reforms.”
And with a younger—the common age is barely 26—and a largely digital-native workforce, the nation seemingly has all of the uncooked supplies to rapidly change into South America’s tech hub.
Whereas Paraguay may be on the lips of tech execs in Silicon Valley and East Asia, the nation nonetheless has a whole lot of work to do by way of telling its story to the remainder of the world—one thing which President Peña is absolutely conscious. “There’s a hole between actuality and notion, and we have to shut that hole … we have to do extra advertising,” he mentioned.
Newsweek spoke to a number of place branding specialists who agreed that Paraguay has a whole lot of floor to make up by way of storytelling and narrative constructing if it needs to harness and absolutely notice all of the potential of the rising curiosity within the nation. “9 out of 10 American CEOs nonetheless cannot level out Paraguay on world political map,” mentioned Patrick Milan, a veteran marketer who has led world campaigns for the Bahamas, BMW, the PGA, and a number of different marquee manufacturers.
“[Paraguay] has an excellent rising tech story, however additionally they have a robust agricultural story, a regional integration story. There’s a lot there,” Milan mentioned. “President Peña is a dynamic marketer and a terrific messenger for the nation however there may be solely a lot one man can do. Plus, he has a rustic to run. Paraguay must embrace the concept of nation branding very like different small energy-exporters comparable to Qatar and the Emirates have achieved so efficiently over the previous 20-plus years.”
Throughout our interview, President Peña talked about that Paraguay is “the small Qatar of fresh, renewable vitality. We transfer 100% of our economic system on renewable vitality.”
Maybe Peña is already envisioning the Gulf States as the proper mannequin for selling his nation’s strengths on the worldwide stage.
However he’d higher transfer quick.
Arick Wierson is a six-time Emmy Award-winning tv producer.
The views expressed on this article are the author’s personal.
