From Shadows to Sunlight, Paraguay’s Road to Transparency

IMF Blog, June 15, 2018

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Canonical URL: From Shadows to Sunlight, Paraguay’s Road to Transparency

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Bibliographic details

Authors: The Editors
Published: June 15, 2018

Transparency reforms and origins

Paraguay passed a transparency law in 2014 that initiated broad changes in public resource management.
The law prompted a shift from “managing the resources in complete darkness” to a more transparent process where “sunlight came in.”
Transparency measures were intended explicitly “to build the trust, the social fabric,” and to make information on public resource use available to citizens and civil society.

Fiscal and programmatic effects

Transparency and accompanying reforms enabled the government to redirect resources to priority areas.
Social programs increased by about 200 percent in coverage and 250 percent in size.
Making room in the budget allowed the government to contain the wage bill and put resources in social programs and infrastructure.
A fiscal responsibility law and public-private partnerships were credited as major contributors to Paraguay’s improving economy.

Political dialogue and public trust

Passing laws did not immediately win public trust; building trust is described as “an ongoing challenge.”
Political dialogue now “routinely includes talk of transparency and fighting corruption.”
Civil society is characterized as “hungry for transparency,” suggesting sustained demand and monitoring from the public.

Role of IMF support and oversight

IMF support is described as crucial to Paraguay’s transparency and anti-corruption effort.
Oversight, indicators, and monitoring are emphasized as necessary because “Corruption has a way to hide in small, dark, little spots and spread around very quickly.”
Linking transparency monitoring to macro stability is presented as especially useful.

Notable quoted passages

“We started to rethink about how we manage resources, and why it’s important for people to know what we’re doing with the resources.”
“Corruption has a way to hide in small, dark, little spots and spread around very quickly.”
“Once it’s out there, I think it’s for good …. civil society is hungry for transparency.”

Source: From Shadows to Sunlight, Paraguay’s Road to Transparency (The Editors, June 15, 2018).

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