Note: This document may not always reflect the actual appropriations determined by Congress. Final budget allocations for USAID's programs are not determined until after passage of an appropriations bill and preparation of the Operating Year Budget (OYB).
PARAGUAY
FY 1998 Development Assistance . . . . . . . . . . . . . . . . . $5,325,000 Introduction
Paraguay is a young and emerging free market democracy of 4.6 million people facing formidable political, economic, environmental, and social challenges. The country has suffered a long history of war with its neighbors followed by subsequent extensive periods of isolation and authoritarian rule. The U.S. Government's overriding policy objective in Paraguay is to consolidate and strengthen democracy. Problems of environmental degradation and rapid population growth are also of concern in the context of U.S. regional and global interests. It is in the U.S. interest to assist Paraguay with its democratic transition because democracy helps preserve political and economic stability in the region. USAID/Paraguay's development assistance program directly supports U.S. Government foreign policy interests in Paraguay and the LAC region.While an impressive beginning has been made in Paraguay's democratic transition, there are still many obstacles in the way of further progress. With its tradition of a strong central executive, judicial, legislative and local government institutions are notably weak. The country suffers from a legacy of weak democratic institutions, values, and practices that are under constant threat of the military, the country's strongest institution. Paraguay continues to look to the United States for advice and support. Strong and effective democratic institutions will guarantee human rights, social justice, and enhance U.S. investment. Paraguay's mismanagement of natural resources, including rampant deforestation, and a high population growth rate are obstacles to creating employment and providing basic services. The rational use of natural resources and increasing use of voluntary family planning helps advance U.S. objectives of protecting the environment and stabilizing population growth.
The Development Challenge
Following the 1989 coup, which toppled a thirty-four year dictatorship, Paraguay began to embrace democratic principles for the first time, and the country has made progress in democratic development. Since 1992, Paraguayans have lived under a multi-party constitutional democracy, with the national government which includes an executive, a legislative, and a judicial branch, seventeen departmental governments, and 220 municipal governments. Following a national constitutional assembly, the country enacted a new constitution in 1992. Also, a new Supreme Court was appointed in 1995 in which magistrates were appointed to life terms, a major step toward judicial independence. Paraguayans eighteen and over can vote for the president, national legislators, departmental governors and assemblies, mayors, and municipal councils. After decades of dictatorship, the country held democratic elections in 1991 and 1996 to elect municipal and departmental officials, in 1993 to elect a President and Congress, and will hold presidential and congressional elections again in 1998.Important building blocks are now in place to support continuing efforts towards strengthening Paraguay's democratic institutions. For example, democratic guarantees for human rights and basic freedoms have been installed, closed newspapers and radio stations were reopened, and the press is now able to provide independent and responsive coverage. The new constitution was a major step in institutionalizing Paraguay's democracy from a strong presidential model toward a balance of power between branches of government. Free and fair elections have also been held. The 1991 municipal elections enabled voters to elect their mayors for the first time. In presidential and congressional elections two years later, Paraguay elected its first civilian president in half a century. In this election, opposition parties also won a combined majority in Congress. In November 1996, 86% of the eligible voters participated in well-run, transparent municipal elections. Current challenges facing the country are attempts at modernizing the state, reducing corruption, and tackling serious socio-economic and environmental problems.
A recent encouraging sign of Paraguay's transition to democracy was the public's strong and well-organized resistance to a potential coup in April 1996. Large scale popular demonstrations not only dissuaded a rebel general from overthrowing the democratically elected president, but also provided the President of Paraguay with the support to withdraw from an apparent face saving compromise that would have severely weakened his power. This decisive show of public support for democracy underscores the Paraguayan people's active commitment to democracy in the face of grave threats.
Paraguay's estimated per capita income of $1,380 masks an extreme disparity of wealth. The top 10% of the population receive 42% of national income, while the poorest 50% receive less than 16%. In addition to being a critical element for its democratic development, a stronger legal and regulatory framework backed by a more professional judiciary is also a key to Paraguay's economic development. Efforts to modernize the judiciary are essential to attracting foreign investment and curbing corruption. Decades of over-dependence on cotton and livestock have taken their toll on the environment. Clearing of forest for agricultural and livestock is a major threat to the survival of these ecosystems and Paraguay has lost over 70% of its forest cover in the last 50 years. Conservation of Paraguay's unique natural resources is of regional and global importance and is critical to the country's long term sustainable development.
The country's population growth rate is one of the highest in the region, and less than 32% of eligible couples have access to family planning services. Maternal mortality is the second largest in the hemisphere. The previous government's lack of investment in health and education and opposition to family planning left Paraguay far behind other countries in the region in providing basic quality services to its population. The country is now in the process of undertaking major reforms in health, education, and family planning services.
Paraguay has a relatively low level of international debt and is current on debt payments. This is not a significant issue for U.S. concern.
Paraguay is not an early candidate for rapid graduation from development assistance. USAID only recently initiated a larger program and the need for assistance to the country's democratic institutions indicate that substantial time and effort are still required. On the other hand, it is expected that USAID's population and environmental special objectives will be achieved by FY 2000.
Other Donors
The United States is one of the largest bilateral donors after Japan, Germany, the European Economic Community and Spain. Other major contributors include the Inter-American Development Bank (IDB), the World Bank, and the United Nations Development Program (UNDP). USAID/Paraguay continues to use its successful reengineering experience of close partner collaboration to successfully leverage other donor resources in all three of its strategic areas.FY 1998 Program
USAID's strategy is to assist Paraguay increase its capacity for sustainable development in a participatory democracy. The program has a strategic objective of improved responsiveness and accountability of key democratic institutions, along with special objectives of improved management of an expanded protected areas system and increased use of voluntary family planning services. To build democracy is the cornerstone of the USAID program, as well as Paraguay's highest priority. This responds directly to the U.S. interests of preserving regional stability and promoting U.S. economic interests. A stable government which protects the rights of its citizens enhances foreign and U.S. investment. Through past USAID assistance, the judiciary, Congress, local governments, and the NGO community have instituted important changes, but they still remain undeveloped and ill-equipped to take on their new responsibilities.Agency Goal: Building Democracy
Paraguay has made an impressive beginning in reforming the government and adopting democratic principles since it began its transition to democracy in 1989. Despite important accomplishments, the transition has been uneven and incomplete. A system of government that responds to citizens' needs and is accountable for its actions is essential. Funding of $2.8 million in FY 1998 will be used to achieve more efficient, transparent, and participatory elections; participatory and better functioning selected sub-national governments; and improved access to strengthened judicial and legislative systems.Fair and open elections are an essential element of representative democracy. USAID/Paraguay's strategy will focus on the institutional strengthening of the Election Tribunal in order that administrative and electoral procedures and timetables are established and that regular and fair elections are conducted in accordance with electoral laws. This activity will be complemented by activities that promote more effective electoral programs by NGOs and civic organizations, and that improve voter education and motivation programs. These activities are especially crucial to prepare for the general elections in FY 1998. In addition, activities to strengthen political parties and improve civil-military dialog will be undertaken.
Better functioning sub-national governments are key to improving the responsiveness and accountability of democratic institutions. Lessons learned in restructuring the budgetary and financial management systems of the Asuncion municipal government and assistance provided to 15 other municipalities have been incorporated into a strategy that has resulted in local action plans with citizens and their local governments sharing responsibility for activities and their outcomes. Initial pilot activities related to the decentralization of basic health services were begun in three municipal districts, and these pilot experiences will serve as models to encourage additional decentralization of public services. Efforts in FY 1998 build upon a program that has been very successful in establishing a national level policy dialogue on decentralization and in promoting a legal framework which facilitates decentralized services.
Reform of the judicial system is essential to ensure due process and respect for human rights, public accountability, and investor confidence. Special emphasis will be placed on programs that ensure that women and men are better informed of their civil and legal rights. Major support is still needed to help the judiciary overcome its poor image, improve access to the judicial system, fight corruption, and move toward an accusatorial and oral process trial system. In FY 1998 USAID will work through a U.S. university and develop two local NGOs to assist this important sector. This will require substantial investment and outside technical assistance.
* Strategic Objective 1: Improved responsiveness and accountability of key democratic institutions.
Agency Goal: Protecting the Environment
Paraguay has one of the highest rates of deforestation in the world. Every year, 10% of the remaining forest cover is lost, threatening the future of unique ecosystems. Environmental problems aggravate poverty, complicate the transition to democracy, and have detrimental impacts on indigenous and non-indigenous women and men. It is important to clearly understand these problems in order to be able to develop economic, social, and environmentally sustainable solutions to them. It is imperative that Paraguay develop and implement sustainable land use models and preserve the last remnants of these important ecosystems. Overall growth and development in Paraguay cannot be maintained over the long term because of Paraguay's failure to protect its resource base. Intensive, unsustainable exploitation of land, water, and wildlife continues. Clearing of forest for agriculture and livestock is the major threat to the survival of these characteristic ecosystems.
USAID/Paraguay will fund activities to help create sustainable models for protected areas, develop management plans for these areas, build local capacity to better manage these resources, and develop economic alternatives to deforestation. A current cooperative agreement with a local NGO will be utilized to develop models of successful private reserves. USAID/Paraguay will also participate with the LAC Regional Parks in Peril program to develop a large public reserve. These models, with an estimated $525,000 in FY 1998 funding, will enable the Government of Paraguay, private land owners, and other donors to contribute a larger amount of funding toward private and public reserves in Paraguay.
Special Objective 1: Improved management of an expanded protected areas system. Agency Goal: Stabilizing World Population Growth
During the previous dictatorship, the health sector was neglected and politicized. Maternal and child health services deteriorated, particularly family planning. Paraguay has a 3.2% population growth rate and less than one-third of eligible women of reproductive age have access to family planning services. USAID support of $2 million in FY 1998 will increase the use of voluntary family planning through expanded access to services, improved quality of services, and advancement toward sustainability of family planning services.USAID/Paraguay has provided technical assistance to the public sector in contraceptive logistics management and support to the private sector to develop a plan to expand and diversify family planning services. The current strategy is to expand access primarily by offering family planning services through existing facilities which do not currently provide them, rather than establishing new facilities; to define quality of family planning services as the provision of a range of modern family planning methods by providers with adequate technical and managerial skills; and to support activities aimed at increasing efficiency and reducing the costs of family planning programs. These activities will be carried out through local NGOs and U.S. cooperating agencies.
Special Objective 2: Increased use of voluntary family planning services.
PARAGUAY
FY 1998 PROGRAM SUMMARY(000's)
USAID Strategic Objectives: Encouraging Economic Growth
Stabilizing Population Growth and Protecting Human Health
Protecting the Environment Building Democracy
Providing Humanitarian Assistance
Total 1. Improved Democratic Institutions
Dev.
Assistance
2,800
2,800
Special Objective 1. Improved Management
of
Protected
Areas
Dev.
Assistance
525
525
2. Increased Use of
Voluntary
Family Planning Services
Dev.
Assistance
2,000
2,000
Total
Dev. Assistance
2,000
525
2,800
5,325
USAID Representative: Barbara C. Kennedy
ACTIVITY DATA SHEET
PROGRAM: PARAGUAY
TITLE AND NUMBER: Improved responsiveness and accountability of key democratic institutions., 526-S001
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCES: FY 1998: $ 2,800,000 DA
INITIAL OBLIGATION: FY 1996
ESTIMATED COMPLETION DATE: FY 2000
Purpose: To support greater government responsiveness and accountability through creation of an effective judiciary and legislature, an independent functioning electoral system, and local government with decentralized services based on wide citizen participation.
Background: Since the beginning of Paraguay's transition to democracy, the country has enjoyed a free press and active media. Human rights have improved and, in addition to national elections, governors and mayors were elected for the first time in history in 1991, with very successful subsequent elections in 1996. U.S. assistance in strengthening and developing stronger governmental institutions and citizen participation in democratic decision-making is crucial at this early stage of democratic development.
USAID Role and Achievements to Date: USAID is moving from small-scale "pilot" activities to a longer range program which features institutional strengthening and human resource development. Technical assistance has been provided to the newly established Election Tribunal to assist in carrying out an assessment of its needs, register voters, inform voters of electoral procedures, supervise the work of new local and regional tribunals and councils, and then conduct the November 1996 municipal elections. The Paraguayan Congress has expanded its budget oversight role and with USAID support is organizing itself to take on a complicated agenda of political, economic and social issues. The Supreme Court and the Office of the Attorney General are receiving technical assistance to draft important laws. Local governments are receiving training in administration, budgeting, and financial management and are part of a USAID supported policy dialogue on decentralization. Citizen groups are beginning to play a greater role in defining priorities and are participating in public hearings for the first time.
Description: USAID will focus on: a) election assistance to support the Election Tribunal in conducting free and fair national elections in 1998; b) promotion of more effective electoral education programs by local NGOs; c) judicial and legislative reform through strengthening institutional capacity and support for the adoption and execution of priority legal reforms, including the introduction of an alternate dispute resolution program and a civic education campaign; and d) support for local governments to better plan and manage their programs which encourage joint local government and a community approach to solving community problems. Funding will be channeled through both local and U.S. based NGOs working in coordination with the corresponding national or sub-national governmental agencies.
Host Country and Other Donors: USAID has taken the lead in encouraging the donor community to support democracy, especially with the Inter-American Development Bank (IDB). Using USAID initiated studies, the IDB is designing complementary projects to help modernize the judicial and legislative branches. The European Union providing support to the legislative branch and the Organization of American States (OAS) is working collaboratively with USAID in the area of election assistance.
Beneficiaries: Most segments of the population of approximately 4.6 million will directly benefit from increased participation and decision-making as a result of electoral support and the reforms in the judicial system. Local communities will have a greater say in the plans for their local and regionalgovernments and will benefit from better management of local health services. Citizen groups involved in urban environmental concerns will receive the benefits of a cleaner and safer environment.
Principal Contractors, Grantees, or Agencies: USAID implements activities through several U.S. private non-profit organizations and international and local NGOs. U.S. principal contractors and grantees are the State University of New York (SUNY), the National Democratic Institute (NDI), the International Foundation for Electoral Systems (IFES), and Development Alternatives Inc. (DAI), . Local NGOs and grantees include the Information and Resources Center for Development (CIRD), the Paraguayan Center for Economic Liberty and Social Justice (CEPPRO), and Alter Vida.
Major Results Indicators: Baseline TargetIncreased percentage of 50% (1 million) 80% (1.6 million) citizens viting in elections
Local governments routinely 2 (1995) 50 (2000) conduct public hearings
Citizen confidence in 30% (1995) 70%(2000) legislative process
ACTIVITY DATA SHEET
PROGRAM: PARAGUAY
TITLE AND NUMBER: Improved management of an expanded protected areas system, 526-SP01
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1998: $525,000 DA
INITIAL OBLIGATION: FY 1996 ESTIMATED COMPLETION DATE: FY 2000
Purpose: To increase protection of Paraguay's natural resources through a strong National Parks and Private Reserve system while promoting compatible activities in the surrounding areas.
Background: Paraguay's biodiversity is at great risk and the country has the highest deforestation rate in the world, relative to its size. Over 70% of its forests have been lost in less than 50 years. Paraguay is third in the world, after Brazil and China, in absolute number of hectares of land cleared per year. This trend is having a devastating affect on the economy which depends on natural resources, primarily soil and wood, for export income. Only 4.4% of the country is under some form of environmental protection and the number of critically endangered species is 25 and continues to increase. Expansion of agriculture continues with little regard for environmentally sound practices. Unless something is done, this will have drastic long-term effects on the economy which relies on the natural resource sector for half the country's employment. Increased poverty because of irrational land use has the potential to destabilize this nascent democracy.
USAID Role and Achievements to Date: Under the previous Parks-in-Peril program USAID assisted a Paraguayan consortium of public and private agencies to purchase and put under long-term protection a 240 square mile reserve, one the last large continuous tracts of Interior Atlantic Rainforest in the tri-country region of Paraguay, Brazil, and Argentina. Through the current Private Reserve program over 198,000 acres have been established, which incorporate conservation and sustainable use of resources. The program has targeted developing effective models of public and private reserves which will be used as a basis for future environmental activities.
Description: All activities are carried out in close collaboration with the Government of Paraguay's (GOP) Directorship of National Parks and Wildlife (DNPW). Activities includes the delineation of new parks, training park guards and other park/reserve personnel, development of enforcement regulations, equipment, and organizing public awareness campaigns on conservation. Through a prominent local conservation NGO, a private reserve program plan is being established which will provide for an effective conservation compatible with sustainable income generating activities. Important components of this plan include health, wildlife, and forestry projects with indigenous communities within and close to the parks. This is because of their close link to the forest and great need for these local populations to use and sustain themselves with food and cash income.
Host Country and Other Donors: The GOP has steadily increased funding for DNPW over the past few years and will continue to expand as the issue of environmental degradation continues to command attention nationally and internationally. Other donors include Japan and Germany. Importantly, the World Bank and IDB emphasize environmental mitigation in their loan packages and have directly provided loans for resource management. USAID coordinates closely with these international financial institutions for maximum impact and plans to use the models developed to encourage other donors to add more funds to expand protected areas.
Beneficiaries: Indigenous groups living in and close to national parks and reserves. Small farmers and rural inhabitants within buffer zones of parks, which comprise 49% of Paraguay's population. The general public through an improved economy which is not based on natural resource depletion.
Principal Contractors, Grantees, or Agencies: USAID implements activities through The Nature Conservancy (TNC), a U.S.-based organization, and the Moises Bertoni Foundation, a local NGO.
Major Results Indicators: Baseline TargetNumber and area of parks protected 13 (1995) 20 (2000)
Reserves under private sustainable management 198,000 acres 568,000 acres (1995) (2000)
ACTIVITY DATA SHEET
PROGRAM: PARAGUAY
TITLE AND NUMBER: Increased use of voluntary family planning services, 526-SP02
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1998: $2,000,000 DA
INITIAL OBLIGATION: FY 1996 ESTIMATED COMPLETION DATE: FY 2000
Purpose: To increase current contraceptive prevalence by expanding access and use of family planning services and strengthening capacity and sustainability of family planning programs.
Background: At 3.2%, Paraguay has one of the highest population growth rates in the hemisphere. This coupled with an extremely high maternal mortality rate (386 per 100,000 births), points to the need for better reproductive health services, including the provision of family planning. Both the public and private sectors provide family planning on a small scale compared to actual need. One reason for this is the pro-natalist policies of the previous government and the Catholic Church's open opposition to family planning. Since the country's transition to democracy, the climate for family planning has improved. The new constitution explicitly provides for the right of couples to receive family planning services and a national population policy is currently being discussed within the congress.
USAID Role and Achievements to Date: While USAID had funded population and family planning activities on a limited basis in the past, it was not until 1994 that the Government of Paraguay (GOP) made reproductive health and family planning a priority. In 1994 USAID jointly developed a population assistance program with the Ministry of Health and a local family planning NGO, Center for Population Studies (CEPEP) This program was approved and implementation began in 1995. USAID focuses primarily on the private sector, and to date, a national reproductive health survey was completed. Expansion of services to include special services for males and permanent methods have begun. Activities to assist the private sector organize cost-effective services are being carried out.
Description: USAID's support for increasing use of voluntary family planning services includes expansion of community-based distribution programs to undeserved rural areas, reproductive health services for adolescents, provision of contraceptive supplies, and programs targeted to special groups such as male clinics and permanent family planning methods. In addition, program efficiency and sustainability are addressed through training and technical assistance in contraceptive logistics management, specialized clinical training, financial and program management and closer coordination between the public and private sector.
Host Country and Other Donors: The GOP National Reproductive Health Council includes members from the public and private sectors and donor community. The council is active in organizing and coordinating all population and family planning activities. The United Nations Population Fund provides public sector support and the World Bank and the Inter-American Development Bank are developing a health sector loan to provide equipment and training to improve quality of public sector health services. The International Planned Parenthood Federation also provides support to its local affiliate.
Beneficiaries: Women of child-bearing age including approximately 1.15 million couples. Young adults and men will also be beneficiaries for information and services. USAID-supported programs are targeted towards at-risk couples not currently using family planning, which includes approximately 150,000 couples.
Principal Contractors, Grantees, or Agencies: USAID implements this program through a number of U.S. based firms such as Management Sciences for Health (MSH), Planning Services International (PSI), Access to Voluntary and Safe Contraception (AVSC), and Family Health International (FHI); plus an international organization, the International Planned Parenthood Federation (IPPF).
Major Results Indicators: Baseline TargetCouple-years of Protection (CYP) 50,000 CEPEP(1994) 75,000 CEPEP (2000) 70,000 MOH (1994) 100,000 MOH (2000)
Contraceptive Prevalence 35% (1990) 55% (2000)
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