I am sitting here in a beautiful cafe near my apartment in Budapest. Life is good. But objectively when I look at some things happening in the world:
– Ballistic missiles flying around the Middle East along with tens of thousands of civilians being killed and political leaders being assassinated.
– War in Eastern Europe that shows no sign of de-escalation.
– People in North America at each other’s throats due to local politics.
– The European economy gradually falling apart under the weight of regulation, socialism, poor energy policies, an ageing population, and low quality immigration.
When I observe this, objectively, having a plan B is far from crazy.
No I am not writing an email about how “Y0u mUst g3t H3r3 to PAraGuaY or PaNAma n0w, the W0rlD iS ab0uT to 3nd!”
Look, war and conflict have been a constant of human nature. Modern man is no different. And it’s not looking great right now.
I’m happy I have a proper Plan B strategy for my family. I sleep well at night and continue living a completely normal life not disconnected from reality. I’m just aware of the risks and have prepared accordingly.
One facet of my strategy is having residency in Paraguay. It’s a great jurisdiction far away from conflict. I like it. In this video I discussed the pros and cons of living in Paraguay with my immigration agent Aleksandr.
You can obtain more information on how to get residency in Paraguay and get in touch with Aleksandr. Getting residency in Paraguay is in the process of becoming a bit harder due to the recent influx of Europeans and Brazilians fleeing socialism and over-regulated economies.
Paraguay is not the only option, at The Wandering Investor our partners can set you up with many residencies and citizenships.
If you want to prepare a Plan B strategy involving residencies, citizenships, bank accounts, international investments, etc, I’d be happy to help you in a consulting call.
To a World of Opportunities,
The Wandering Investor.
Services in Paraguay:
Other opportunities in Paraguay:
- Full guide to investing in real estate in Asuncion
- An off-grid community in Paraguay as a Plan A or Plan B
- Investing in Asuncion Real Estate in Paraguay – an ROI case study with numbers
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If you want to discuss your internationalization and diversification plans, book a consulting session or send me an email.
Transcript of “The Pros and Cons of living in Paraguay”
LADISLAS MAURICE: Hello, everyone. Ladislas Maurice from thewanderinginvestor.com in Asunción with Aleksandr, who’s been helping me obtain residency here in Paraguay. How are you, Aleksandr?
ALEKSANDR: Fine. And you?
LADISLAS MAURICE: Good. Good, good. We’re going to be discussing the pros and cons of living here in Paraguay. Look, before coming here, the overall perception I had of Paraguay, which I heard from online, etc., people always said it’s a shithole, right?
ALEKSANDR: [laughs]
LADISLAS MAURICE: [laughs] And I’ve been here for about two, three weeks. I rented a car, drove around the whole country, and honestly, I am very pleasantly surprised. I’m happy that people manage my expectations, in the sense that it’s made this trip a lot more pleasant, in the sense that everywhere I went, I was actually very happy, and I was quite impressed with a lot of things I saw. I think today’s discussion is just to set the record straight on what are the true advantages and the true disadvantages of living here in Paraguay.
Aleksandr’s background
LADISLAS MAURICE: Aleksandr, so you were born here in Paraguay. Correct?
ALEKSANDR: Yeah, correct.
LADISLAS MAURICE: But you also lived in Europe, etc., so you’re able to see both perspectives, and you see your country for what it really is.
ALEKSANDR: Mm-hmm (affirmative).
LADISLAS MAURICE: Cool. Let’s go through a list of pros.
Freedom in Paraguay
ALEKSANDR: The strongest pros, I think, it’s that nobody cares what are we doing here. So, the government doesn’t control you too much. You can do your business without problem. There is no inspection, some control, different [instance 01:43] that are coming to your business asking for something. Now, usually you are doing your stuff. If it’s like in the mark of the law, and you just earn your money, it’s pretty easy to work on something here without being bothered by the government. That it’s like the best thing that I like here, even I know if you go to the street, if you could drive a car, there is, like, some people from Germany doesn’t like that, that you don’t have a sign everywhere, but for me, it’s like freedom, like, you need to think by yourself. If your road it’s a principal one or it’s a secondary.
And it’s, like, nobody controls the velocity of your car, how fast you are driving. There are only some places where they are controlling but it’s like if you go to Brazil to Ciudad del Este, but usually in the city in Asunción, nobody controls. There is no camera controlling that. For me, it’s like freedom.
LADISLAS MAURICE: It’s true. I could tell the difference leaving Paraguay and driving into Brazil and Argentina. As soon as you cross either of the borders, speed trap, speed trap, speed trap. And then Argentina, just like police controls constantly. You come back to Paraguay, no speed traps. I saw one in my whole road trip around the country, to your point, near Ciudad del Este on the main highway. Apart from that, nothing. From that point of view, I agree, a lot of freedom. And then taxes.
Taxes in Paraguay
ALEKSANDR: Yeah, taxes, they’re pretty low. You have a 10% tax on net income. It’s like it’s not so high compared to the neighbors country, like Brazil, Argentina, they have more higher taxes. That’s good things, too, here. And if, for example, if you are a nomad, it’s even more easier to earn. Your $3,000, for example, in paying only small part of that. And so that thing is a good point of Paraguay.
LADISLAS MAURICE: And if you structure things properly, there’s no taxes on income earned outside of Paraguay. If you work online, if you have a business overseas, etc., if you structure things properly, you don’t actually have to pay any taxes in Paraguay. Sure, locally, it’s 10%, but if you do things well and you’re not actually active locally, from a business point of view, you can end up paying 0%, which you can do in Central America in a few countries, but in South America, it’s pretty much the only country where it’s this straightforward.
Affordable living in Paraguay
ALEKSANDR: Third one, I know if it’s cheaper, much cheaper than other countries, but at least it’s not expensive as Spain or countries like that. If you, for example, are a nomad, and you have a salary of $2,000, $3,000 per month, you are a king here. Like, you can have a family, you can buy a car, you can even buy an apartment in the long term. It’s like you don’t need to earn too much if you take the perspective of the foreigner. If you are a local one, yeah, here, the salary are low. If you work for a company here at the lowest level, for about the basic level, you earn only 350 bucks. It’s a low salary, it’s not enough, but if you are foreigner and you have high earnings outside, you live here like a king. You feel that big difference.
For example, when I lived in Spain, I feel that I was a lot poorer there, even though that you earn maybe more than in Paraguay but you feel that you are poorer. Meanwhile, in Paraguay, you feel that you are a lot more richer. You have more access to goods than in Spain.
LADISLAS MAURICE: In terms of cost of living, I would compare it, in many ways, to Belgrade, to Serbia, roughly. So, not cheap-cheap but, overall, very good value for money, especially for people coming from North America.
Resilience in Paraguay
LADISLAS MAURICE: And can you elaborate as well on, because this is important, because a lot of people use Paraguay, not just for taxes, but a lot of people use it as a Plan B in case of things happening in the world, and they need to go, there’s a food crisis, supply chains are broken, etc. Can you talk about this aspect in terms of resiliency here in Paraguay?
ALEKSANDR: First of all, electricity. Paraguay produce at least for the next 10, 15, years its own electricity. We don’t have a problem with electricity, like, I don’t know, in South Africa, or in countries like that. Here, you have that safe [long 07:10] at that level. Then the water supply, we don’t have much problem with that, even with the last dries [drought] that we have, like, food, because of those changes that you have in the climate.
LADISLAS MAURICE: I mean, literally, Paraguay sits on a massive aquifer, so underneath the whole country, there’s water.
ALEKSANDR: Even the last five years we had dry season, and for now, it’s not affecting us terribly. Food supply, we, like, produce all our own meat. Basically, we’re a big exporter of that thing. And the best meat that you get in South America, at least for me, it’s the best thing.
LADISLAS MAURICE: It’s good.
ALEKSANDR: Even when I was in Brazil, you don’t have meat like Paraguay one. If you take vegetables, maybe Paraguay doesn’t produce everything in that sense, but you have your neighbors, like, Brazil, Argentina, who produce all those things. If you take South America, or every country that are into the Mercosur bloc, they produce their own food. And then you can take that, at political level, it’s pretty stable. We have some problem but generally, it’s stable. We don’t have, like, guerilla groups somewhere, big groups that right now controls the half of the country. We don’t have tension in the sense that there is right now big socialistic movements that want to conquer the country and to make a new Venezuela, or something like that. It’s pretty stable, like, a conservative country.
Safety in Paraguay
LADISLAS MAURICE: And again, I’m going to go back to that example. When you leave Paraguay, you go into Brazil, you just feel little bit of violence in the air, or potential for violence in the air. And you can just see it by the amount of security that homes have just across from across the border in Brazil. And then when you go into Argentina, there, you can just tell there’s a lot of socialism. There’s just a lot of government socialism. And then you come back to Paraguay, it’s a little chaotic. You’re free. It’s nice. [laughs]
ALEKSANDR: Yeah, the crime rate, it’s at middle level. There is a difference. Even in Brazil, you have regions that could be safer than some region of Paraguay. It’s, like, there is a thing. But in generally, Paraguay is safer than Brazil. If you go to the south of Paraguay, it’s pretty stable. There is no so much shooting between Narcos and all that thing. The north of Paraguay, it’s more dangerous but generally, Paraguay is safer than Brazil, than Argentina and countries around us.
LADISLAS MAURICE: Especially as a tourist, because when there are issues, it’s just Narcos having a go at each other, and again, a lot less than in other countries. But as a tourist, it doesn’t really impact you at all.
ALEKSANDR: Because even if you are tourists, typically, in Paraguay, as a tourist, you are not going to the place where there is a dangerous thing happened. Because it’s not a tourist zone. It’s a typical Narco zone, Narco city, who are having their own business. But meanwhile, if you go to Brazil, many tourist area are dangerous area.
Gun rights in Paraguay
LADISLAS MAURICE: And then let’s talk about gun rights. I know Europeans generally don’t care too much about this, but for my Canadian and American audience, I know you do care about this. Tell us about gun rights. I’ll receive my residency in a few months. And you’ll give it to me, you’ll be like, “Ladislas, congratulations. Here’s your cédula.” And I’ll be like, “Aleks, I want a gun.” What do I do?
ALEKSANDR: You have two level of having a gun. One it’s a basic one, when you just buy a gun, and in one month, you will get a license for having your gun in your house, or car, or something like that. You can’t bring your gun to the public, which is–
LADISLAS MAURICE: You can or you can’t?
ALEKSANDR: You can’t, you can’t, you can’t.
LADISLAS MAURICE: Okay.
ALEKSANDR: Yeah, without a license. You only have a right to have in your house or your car. But you can use as your defense weapon. If someone, for example, I don’t know, if you are on the car and someone attacks you, you can bring your gun from your car and to shoot at the one who attacked you.
LADISLAS MAURICE: Let’s take an extreme scenario. Let’s say I get my card in a few months. Let’s say I didn’t speak any Spanish. I don’t need to pass some license test or some, like, government test to show that I’m eligible or whatever?
ALEKSANDR: Usually, the shop that sells you the gun, for 50 bucks or something like that, they can make the needed process to give you the right to the gun, the license.
LADISLAS MAURICE: Okay, cool. And then a month later I have my gun?
ALEKSANDR: No. You will have your gun in the moment when you buy your gun.
LADISLAS MAURICE: So I can get it immediately?
ALEKSANDR: Yeah. Because by law, you have, like, 30 days after buying a gun that you need to get a license. During that month, you can have your gun. But after that one, you need to have your license.
LADISLAS MAURICE: Okay, cool. So, I can be angry, go buy a gun?
ALEKSANDR: [laughs] Yeah.
LADISLAS MAURICE: Okay. But they’re more expensive than in the US, right?
ALEKSANDR: Yeah, it’s pretty expensive. For example, I know if you take Glock, it could get higher as $2,000 for a Glock. So, it’s expensive. American guns are expensive here. If you want something cheaper, you need to buy some Brazilian ones. I think Taurus is Brazilian, something like that. So, it’s cheaper. But yeah, usually guns are expensive. You have a right to have a semi-automatic, shotguns, rifle, pistols, all that thing. And after you have that license, you can apply to have your gun with yourself.
LADISLAS MAURICE: So concealed carry?
ALEKSANDR: Yeah. But the problem with that that usually the government doesn’t issue that license to the general public, because it’s always only those who are in security, working in security, something like that. Only if you have security license you will get. But if you don’t have that, it’s not so easy to get.
LADISLAS MAURICE: Okay. So, you can have your gun at home, in your car, and then when you go shooting in the countryside, and at the gun range, whatever.
ALEKSANDR: In the countryside, nobody cares. Nobody controls that if you have your hectares, no idea. People even have illegal guns there, because there are many owners who have, like, thousands and thousands, thousands of hectares who will control their–
Internet in Paraguay
LADISLAS MAURICE: Cool. So, nice, with the cowboys. And then I’ll add as well that the internet connection in the country, when I was traveling, was actually quite good. Now let’s get to the real stuff. Let’s go to the cons, so the negative points about living in Paraguay.
ALEKSANDR: The negative thing will be–
LADISLAS MAURICE: I’ll start off, the mosquitoes.
ALEKSANDR: The mosquitoes, yeah.
LADISLAS MAURICE: Everywhere.
ALEKSANDR: Everywhere.
LADISLAS MAURICE: You just start to learn to live with them, but yeah.
ALEKSANDR: If you want to go to nature, be ready.
LADISLAS MAURICE: For the mosquitoes. Cool. Other points?
The legal system in Paraguay
ALEKSANDR: Other point will be the Supreme Court, the court, the prosecutor, all that thing, the legal level, if you want to fight with someone at the legal level, it’s like a pain. It’s difficult. It’s so corrupted. There are many corrupted people there. If you have problem with some local who have some level of influence at the political level, it will be hard to you to win, even if you are right. If you are here, yeah, it’s freedom, nobody cares, the government doesn’t care. But if you go to the court system, be ready that you will spend many days, many years fighting, and you will lose your money, like, you will spend your money every time, because you have not only those corrupted people there, that inefficient system, but also the lawyers here are like predators. They only want money from you. And if you are foreigner, for sure, the majority of lawyers will want to just get money from you and not doing anything.
LADISLAS MAURICE: Cool. So, people have been warned. Essentially, if you have issues with a contract, etc., it’s going to take years to solve, like, many, many years.
ALEKSANDR: Yeah. If you buy something, if you do something, the best thing, it’s just to prevent. You need to check what you are buying, you need to check with whom you are dealing, and be, like, taking into account if something bad can happen. And if you are not ready to accept that, then don’t do that, because if it will happen, and then you need to go to the court system, it will be like a pain.
LADISLAS MAURICE: Cool. I know you help quite a few of your investors buy real estate here. Generally, property rights are safe in Paraguay. But to your point, you want to work with, like, good lawyers, competent lawyers to help you through the process so that you prevent rather than trying to fix a situation later on.
ALEKSANDR: Yeah. For example, some local lawyer sold an inexistent land to some foreigners. And after that, it’s basically it will take years for them to get back at least half of that amount. And it was, like, $100,000 more than that they lost in that. So, yeah, you need to be careful with this thing. Because local people, yeah, they’re good, they’re smiling, they’re always trying to help you but you are foreigner, you are a gringo, so, always in the eyes of the local, you will be always like, when you have a lot of money, like, bag of money, you will be a bag of money.
LADISLAS MAURICE: Okay.
ALEKSANDR: [laughs]
Not well connected
LADISLAS MAURICE: Cool. And then one of the big disadvantages here, as someone who travels a lot, is the remote location and the poor flight connections. Look, you go to the airport here, and there’s, like, a few flights a day. Typically, they’re, like, at 1:00am, at 2:00am to go to Panama, or Brazil, or Argentina. There are no low-cost airlines to fly around the region, so you just always have to take the real airlines, and the connections are quite poor and the flights are expensive. If you want to fly around pretty cheap, you need to drive to Argentina, drive to Brazil, and then take local flights from there, you’ll get better deals. But overall, it’s expensive and it’s not easy to get to.
So when I look at this, I wouldn’t say it’s appropriate for people who travel a lot and who want to be coming in and out of their base on a regular basis, especially if they don’t have that much business in South America. It’s good as a Plan A, so people who actually want to live here. It’s very livable, very comfortable. I like it a lot. And it’s also a great Plan B, so people who want a residency in case things happen, then they have their Plan B, or who just want a residency to show to their home government. This is not tax advice, because it depends on your country of citizenship and of former residency, where you just need to show your home government that you have a residency of some sort. And Paraguay, in this case, works quite well as well.
Banking in Paraguay
LADISLAS MAURICE: So I’d say these are the two use cases of Paraguay. And then also, finally, the banking system is–
ALEKSANDR: Yeah, is pretty bad. It’s not easy to open a normal bank account. You need to be, first, a resident. Then you need to show some tax movement, local tax movement. And only after six months, some banks ask for 12 months, you will be able to open a dollar account. So, yeah, it’s–
LADISLAS MAURICE: Horrible banking. If you come here, you move to Paraguay, you continue banking overseas, just forget about local banking unless you have local business activities, or unless you wanted to pay for some bills, or pay locals, or whatever, when you’re not here. But just don’t move to Paraguay hoping that you’ll get a good bank that’s functional. Trying to do international transactions out of here is a complete nightmare, whether incoming or outcoming. So, in an ideal world, you either live in Paraguay or you have it as a Plan B, but you don’t deal with local banking.
ALEKSANDR: But even, like, if you have a proof from where your money is coming, after the residency card, you can open a local basic bank account, and you can receive. But you will not receive directly. You will receive, like, you need to go to the office to ask permission for receiving the money, and you need to show a proof from where you get that money–
LADISLAS MAURICE: And they’ll want to translate it and this and that?
ALEKSANDR: Yeah, yeah, all. Yeah.
LADISLAS MAURICE: Cool. All right, fantastic. I think this kind of covers the pros and cons of living in Paraguay. Overall, I like it. It’s a lot better than I thought it would be. To be completely honest with you, I absolutely do not believe the GDP per capita figures that are published for Paraguay. When you drive around, it’s clearly a lot richer than what the numbers imply. When I see this country, I see a massive hidden/black economy that is not visible in the numbers, but that is visible in people’s living standards and just in the general economy around. If you’re going to base your perception of Paraguay based on all of these World Bank metrics, you’re going to come here with the wrong perception, which I did, actually. And now I just think of Paraguay very differently, in a lot more positive way.
I recommend that you come here if you’re interested in these things. And then if you want residency here in Paraguay, feel free to get in touch with Aleksandr. There is his email below. There’s also a link with more information on his services. And then he can send you a brochure with the whole process of how to obtain residency as well as his price list.
ALEKSANDR: Yeah.
LADISLAS MAURICE: Great. All right. Aleksandr, thank you very much.
ALEKSANDR: Thank you.
