Economic Relations between Russia and Paraguay After 2022: Trends and Prospects

Introduction. The research is dedicated to the current state and prospects for the development of Russia-Paraguay foreign economic relations in the context of a changing international architecture — after 2022, the start of special military operation (SMO) and the deepening of the Russia's systemic crisis in its relations with Western countries). The relevance of the study stems from the need to diversify Russia's trade and economic partners amid growing sanctions pressure. Under current circumstances, Latin American and Caribbean countries have become a sought-after destination for Russian officials and businesses involved in foreign trade.
Methods and Materials. The study draws on statistical and empirical data reflecting the content and dynamics of trade and investment interactions between the Russian Federation and Paraguay. The authors rely, firstly, on a systems approach, which allows them to present economic cooperation as a holistic process influenced by internal, external, and international structural constraints. Secondly, they employ a retrospective historical method, which is necessary to reveal the dynamics of Russian-Paraguayan relations from the 2010s, when they were growing, to the early 2020s, when tensions between Russia and the West created obstacles. Third, statistical analysis and SWOT analysis methods were used to determine the structure and dynamics of mutual trade, as well as the strengths and weaknesses, challenges, and opportunities for economic cooperation between the two countries. The authors also calculated international trade indices for Russia and Paraguay to ensure the validity of their findings.
Results. The study revealed that Russia's trade turnover with Paraguay has been steadily declining over the past 10 years, and the diversification of their product mix is low. Despite initial hopes, the countries have also failed to make progress in investment cooperation. On the other hand, despite existing limitations, the Russian-Paraguayan economic partnership possesses significant untapped potential, the realization of which, however, is very limited without institutional and political coordination.
Discussion and Conclusion. The findings are clearly practical in nature and can be useful for forecasting the development of Russian-Paraguayan economic relations and understanding their objective limits and potential.