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Glossary -- Paraguay
- Dessarrollismo
- An economic policy that attempts rapid economic development
with an emphasis on progress, often with a leading role for the
public sector.
- Encomiendas
- A Spanish, colonial system of land grants to Conquistadors that
included rights to the use of Indian labor.
- fiscal year (FY)
- Calendar year.
- guaraní (G)
- The national currency. From 1960 to 1982 the guaraní remained
pegged to the United States dollar at G126=US$1. Responding to the
completion of construction of the Itaipú hydroelectric plant and lower
commodity prices for soybeans and cotton, in July 1982 the Central Bank
established a multitiered exchange rate system. The most favorable
rate was reserved for the imports of certain state-owned enterprises
and for external debt-service payments. Three other controlled rated
were applied to imports of petroleum and petroleum derivatives;
distribursements of loans to the public sector; and agricultural
imports and most exports. Commercial banks set a fifth, free-market
rate that governed most of the private sector's nonoil imports. In
early 1988, these five rated were G240=US$1, G320=US$1, G400=US$1,
G550=US$1, and approcimately G900=US$1, respectively. The multitiered
system constituted a massive subsidy to state-owned enterpreses.
Central Bank losses in controlled exchange rate transactions accounted
for nearly half of public-sector deficit in 1986. In July 1988, the
Central Bank eliminated the two most favorable exchange rates; set
G400=US$1 as the rate for imports of state-owned enterprises;
external debt-service payments, and petroleum imports; and established
G550=$US1 as the rate for disbursements for loans to the public
sector, agricultural imports, and most exports. In January 1989, the
Central Bank further devalued the guaraní by setting the controlled
rates at G600=US$1 and G750=US$1 and also required petroleum imports
to be paid at the higher rate. In early 1989, the free-market rate
exceeded G1,000=US$1.
- Gross Domestic Product (GDP)
- Total economic output in a given country. (See definition used
in earlier volumes).
- Gross National Product (GNP)
- Total market value of all final goods and services produced by an
economy during a year. Obtained by adding GDP (q.v.) and the
income received from abroad by residents less payments remitted abroad
to nonresidents.
- International Monetary Fund
(IMF)
- Established along with the World Bank (q.v.) in 1945,
the IMF is a specialized agency affiliated with the United Nations;
it is responsible for stabilizing international exchange rates and
payments. The main business of the IMF is the provision of loans to
its members (including industrialized and developing countries)
when they experience balance of payments difficulties. These loans
frequently carry conditions that require substantial internal
economic adjustments by the recipients, most of which are
developing countries.
- Informal Sector
- Small, competitive individual or family firms engaged in petty
retail trade and services, typically in urban areas.
- Southern Cone
- name for area of South America consisting of Argentina, Chile, Paraguay,
and Uruguay.
- World Bank
- Informal name used to designate a group of three affiliated
international institutions: the International Bank for
Reconstruction and Development (IBRD), the International
Development Association (IDA), and the International Finance
Corporation (IFC). The IBRD, established in 1945, has the primary
purpose of providing loans to developing countries for productive
projects. The IDA, a legally separate loan fund, administered,
however, by the staff of the IBRD, was set up in 1960 to furnish
credits to the poorest developing countries on much easier terms
than those of conventional IBRD loans. The IFC, founded in 1956,
supplements the activities of the IBRD through loans and through
assistance designed specifically to encourage the growth of
productive private enterprises in the less developed countries. The
president and certain senior officers of the IBRD hold the same
positions in the IFC. The three institutions are owned by the
governments of the countries that subscribe their capital. To
participate in the World Bank group, member states must first
belong to the International Monetary Fund (q.v.).
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