Paraguay: A Green Energy Tech Hub

The Green Powerhouse: Can Paraguay Become South America's Tech Oasis?

A bold ambition is taking shape in the heart of the South American continent. Paraguay, a nation historically recognised for its agricultural output, is now making a determined push to become the region's next major technology centre. Spearheading this transformation are visionaries who see a future powered not by soybeans, but by silicon. They are driving a national effort to harness the country's unique advantages, including a wealth of clean energy and a youthful population, to draw in global tech investment and foster a vibrant domestic innovation scene. This ambitious plan seeks to redefine Paraguay's economic identity and place it firmly on the global technology map, creating a hub of digital innovation nestled between its larger neighbours.

A Visionary's Return

Central to this ambitious national project is Gabriela Cibils. Her journey reflects the very transformation she champions for her country. She recalls a childhood in Paraguay where technology was not a primary societal focus; however, her path was shaped by parents working within the industry. This early exposure ignited a passion that led her to the United States, where she earned a qualification in computer science and neuroscience from Berkeley's University of California. Following graduation, she immersed herself in the epicentre of global innovation, dedicating nearly a decade of her career to the ecosystem near San Francisco and holding positions at several American new ventures. This experience provided her with a firsthand understanding of technology's profound impact on society and business.

A Mission to Innovate

A few years back, she opted against remaining in the United States permanently and made the pivotal decision to return to her homeland. Today, she is a key figure in the drive to establish a significant and flourishing technology industry in Paraguay. Her goal is to elevate the nation of seven million residents onto the world stage, attracting the attention and investment of global technology giants. Currently, she holds a partnership position at Cibersons, an international tech and investment company based out of Asunción, the capital. She articulates a sense of responsibility to merge the dynamic, fast-paced mindset of Silicon Valley with the rich, untapped talent she observes within Paraguay, creating a powerful synergy for growth.

The Hydroelectric Advantage

Numerous nations strive to develop a leading technology industry, yet Paraguay holds a significant edge in a crucial area: a vast supply of inexpensive and sustainable electrical power. The nation's energy grid derives its entire output from hydroelectric sources, a feat few countries can claim. This unique position provides a compelling incentive for energy-intensive industries, particularly the rapidly growing field of artificial intelligence and large-scale data centres. The reliability and low cost of this green energy source make Paraguay an increasingly attractive destination for global technology firms that are focused on sustainable and economically viable operations, setting the nation apart from its regional competitors.

Image Credit - Angelo Leithold, CC BY-SA 3.0, via Wikimedia Commons

Itaipu: The Engine of Progress

At the core of Paraguay's green energy supremacy is the colossal Itaipu Dam. This marvel of engineering, situated on the Paraná River along the frontier separating Paraguay from Brazil, stands as the planet's most significant hydroelectric facility beyond China. This is a testament to the nation's capacity for large-scale infrastructure projects. The dam is the primary source of the country's electrical power, providing nine-tenths of Paraguay’s power and a tenth of Brazil’s. This immense generating capacity has led to the most affordable electricity rates across the South American continent and established Paraguay as the globe’s leading exporter of renewable energy.

Attracting Global Tech Titans

Officials in the Paraguayan government are banking on the nation's plentiful and affordable green power to lure international tech corporations. The immense power requirements of artificial intelligence systems present a significant opportunity for the nation. Sebastian Ortiz-Chamorro, an entrepreneur in the Paraguayan software development field, advised potential investors to consider that hydroelectric energy is dependable in addition to being renewable. He explained that this makes it more appealing for building data centers or any power-hungry enterprise needing constant electricity, unlike the fluctuating nature of other green sources such as solar or wind. He also noted that besides the major state-operated facilities, it is simple for private firms to establish smaller, independent hydroelectric plants.

Presidential Push for Investment

The nation's leadership is actively promoting this vision on the international stage. Last year, while traveling in California, President Santiago Peña of Paraguay met with representatives from corporations such as Google and OpenAI to promote investment in his nation. The purpose of these meetings was to encourage these major industry players to create substantial operations there. The president's direct engagement with the world's leading tech firms underscores the government's serious commitment to this national project. The outcome of these discussions, and whether these industry players will establish a significant presence, is yet to be determined, but the meetings represent a crucial step in positioning Paraguay as a credible and attractive destination for high-tech investment.

A Digital Park in the Making

Technology and Communication Minister Gustavo Villate collaborates closely with the president to advance these initiatives. He proudly highlighted the nation’s advantages, mentioning its youthful population, vast reserves of renewable green power, low tax rates, and consistent economic conditions. A tangible symbol of this commitment is the site designated for a new digital park located close to the primary airport in Asunción. At present, the area consists of open fields and a few military structures, but the government has grand plans for its transformation. Displaying the blueprints, Mr Villate pointed out features like lakes and a daycare facility, anticipating completion in less than 24 months.

Fostering an Innovation Ecosystem

The government intends to fund the initial phase with approximately $20 million (£15 million), with the expectation that private enterprise will finance the remaining development. Mr Villate stressed that even before the physical infrastructure is complete, the current cooperation between public, private, and academic entities is crucial for establishing an ecosystem that will appeal to overseas investors. This partnership is seen as essential for establishing an environment that is not only appealing to foreign capital but also capable of nurturing homegrown talent and fostering sustainable, long-term growth in the technology sector.

Harnessing a Youthful Demographic

A key element of Paraguay's strategy is its young population, which the government considers a primary asset for attracting businesses seeking a substantial workforce for the technology field. The median age in Paraguay is just 27 years old, a demographic dividend it is keen to leverage. However, unlocking this potential requires a concerted effort to train and upskill young people for the demands of the digital economy. The new digital park is set to play a crucial role in this endeavour, as it is set to include The University of Technology, a collaborative project between Paraguay and Taiwan, designed to provide specialised education and training in key technology fields.

A New University for Tech

This collaborative educational initiative is a cornerstone of the country's plan to develop a competent workforce. The partnership with Taiwan aims to bring world-class technical education to Paraguay, focusing on disciplines that are in high demand within the global tech industry. The university will offer a curriculum designed to equip students with the practical skills and theoretical knowledge needed to thrive in areas such as software development, data science, and cybersecurity. By investing in high-quality education, Paraguay is not only preparing its young people for the jobs of the future but also signalling to international investors that it is serious about creating a sustainable and talent-rich technology ecosystem.

Nurturing Homegrown Talent

Simultaneously, other programs exist to educate young people nationwide. The president of the Paraguayan Chamber of the Software Industry, Vanessa Cañete, stated that her trade organization is diligently working to develop a substantial cohort of software engineers and programmers capable of supporting the software service industry. Her organisation is actively involved in creating training programmes and fostering a supportive community for aspiring tech workers. These grassroots efforts are crucial for building a deep and diverse talent pool that can meet the needs of a growing technology sector.

Championing Women in Tech

Expressing her dedication to promoting computer engineering among women, Ms Cañete established the non-profit Girls Code in 2017 to address the gender imbalance in the tech field. This initiative provides workshops in robotics and programming to young women and teenagers, with over a thousand participants trained to this point. This focus on inclusivity is not just a matter of social equity; it is also a strategic imperative to ensure that Paraguay is tapping into the full potential of its entire population. The programme equips them with valuable skills and inspires them to pursue careers in a sector where their contributions are vital.

Enhancing Global Communication

Recognising the importance of seamless communication in the global technology market, the industry is also investing in language skills. Ms Cañete mentioned that developers receive extensive English language training to better interact with foreign businesses. This practical measure is designed to remove potential barriers to international business and ensure that Paraguayan tech professionals can compete on a global scale. By equipping its workforce with both technical and linguistic skills, the country is positioning itself as a reliable and effective partner for international technology companies looking to expand their operations.

A Pragmatic Approach to Growth

The individuals interviewed exuded optimism about the value Paraguay can bring to the international tech community, while also demonstrating a practical understanding of the challenges. Ms Cibils conceded that overseas investors encounter developmental hurdles when navigating the local business environment. Issues such as administrative red tape can slow down the process of conforming local agreements to international contract norms. Addressing these administrative hurdles is a key focus for both the government and the private sector as they work to create a more streamlined and investor-friendly climate.

Overcoming Bureaucratic Hurdles

Efforts are underway to simplify administrative procedures and reduce red tape for new businesses. The government is actively seeking feedback from the private sector to identify and eliminate bottlenecks in the investment process. This includes initiatives to digitise government services, harmonise regulations with international standards, and provide clearer guidance for foreign companies looking to establish a presence. By demonstrating a commitment to improving the ease of doing business, Paraguay aims to build confidence among international investors and create a more competitive and attractive market for technology companies.

Building a Superpower

However, she remains firm in her belief that Paraguay could become a formidable global player by making innovation a central focus and maximizing the country's unique advantages. This optimistic outlook is shared by many who see the current moment as a pivotal opportunity for the country to redefine its economic destiny. The unique combination of plentiful green energy, a youthful and eager workforce, and a strategic push from both the government and private sector creates a compelling case for the nation's future as a technology hub.

The Road Ahead

The journey to becoming a premier tech destination in South America is a long and complex one, requiring sustained effort and investment over many years. However, the foundational elements are in place. The government's proactive stance, the dedication of industry leaders, and the untapped potential of a young and dynamic population all point towards a promising future. As the planned digital campus takes shape near Asunción, it symbolises a nation on the move, confidently stepping onto the global stage and ready to embrace the opportunities of the digital age. The world will be watching to see if this green powerhouse can indeed blossom into a vibrant tech oasis.