Election Uncertainty

May 2007 | Risk Summary

In our new political risk ratings system, Paraguay continues to score well below the Latin American average. Its short-term rating of 62.9 largely reflects the growing uncertainty surrounding the 2008 presidential election, as opposition challenger Fernando Lugo is poised to disrupt the long-standing Partido Colorado (PC). Competing factions within the PC could also slow policy enactment in the near future, and weigh down on the country's policy continuity score. Indeed, we attach a downside bias to this rating over the coming months, until the election outcome becomes clear. Paraguay's long-term rating of 56.4 takes into account the relatively weak constitutional

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