Alcoholic Drinks in Paraguay

Paraguay’s alcoholic drinks industry is already relatively well-developed, although further room for sales growth remains as consistent economic stability and social development continue to expand the consumer base. Rising numbers of female drinkers, rising incomes and increasing sophistication are pushing demand towards higher-priced options such as craft beer, fine wine and premium spirits.

Market insight: COVID-19 impact

The negative impact of the COVID-19 pandemic on sales of alcoholic drinks in Paraguay during 2020 has turned out to be not as severe as initially expected. In most categories, only moderate declines have been seen in total volume sales, although on-trade demand has been severely compromised due to the closure of all bars, restaurants and cafés during the officially mandated lockdown period which remained in effect for an extended period during the second and third quarters of the year.

Country insight: COVID-19 impact

The virus was confirmed as present in Paraguay on 7 March 2020. In response, the government initiated a lockdown on 10 March.

Country insight: Pre-COVID-19

Alcohol consumption is generally deemed completely socially acceptable in Paraguay. Most social gatherings include alcohol and drinking is widespread, to the extent that many people are becoming concerned about the country's per capita alcohol consumption levels.

Socioeconomic trends

Paraguay achieved a steady reduction in poverty levels during the review period. Only 6% of the population lived below the international poverty line of USD3.

Logistics/infrastructure

Paraguay's road network is subject to growing investment and transportation infrastructure is one of the focus areas for the country’s National Development Plan 2014-2030. However, many roads remain in poor condition, mainly in rural areas, where many roads remain unpaved.

Legislation

The legal drinking age and legal purchasing age is 20 years and did not change during the review period. This legislation is however rarely enforced.

Taxation and duty levies

Taxation on alcoholic drinks remains low in Paraguay in comparison with other regional countries. Products face 10% VAT and a Selective Consumption Tax (ISC).

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