IDB Approves $10 Million Loan to Boost Innovation and Startups in Paraguay

The program is expected to play a key role in expanding Paraguay’s innovation ecosystem by supporting both established companies and emerging technology startups.

The Inter-American Development Bank (IDB) has approved a $10 million loan aimed at strengthening the innovation capacity of companies, entrepreneurs and institutions in Paraguay, in a move designed to accelerate technological development and economic diversification in the country.

The funding will support the Business Innovation Program II (PROINNOVA II), which will be implemented by Paraguay’s National Science and Technology Council (CONACYT). The initiative seeks to increase private-sector investment in innovation, promote technology-based entrepreneurship and develop specialized talent in innovation management and technology transfer.

Boosting Paraguay’s Innovation Ecosystem

The program is expected to play a key role in expanding Paraguay’s innovation ecosystem by supporting both established companies and emerging technology startups.

PROINNOVA II will finance a range of activities aimed at strengthening research, development and commercialization of new technologies. These include technological development projects within companies, as well as initiatives that help businesses adopt innovation strategies and improve productivity.

The program will also fund the incorporation of innovation managers within firms, helping companies adopt modern innovation practices and integrate advanced technologies into their operations.

Support for Startups and Prototype Development

A major focus of the program will be the promotion of technology-based entrepreneurship, particularly among early-stage firms.

Funding will be allocated to help young companies validate prototypes, develop business models and test innovative solutions in the market.

The initiative will also strengthen technology service centers, which play a crucial role in supporting businesses with research, testing and technological assistance.

These measures aim to reduce barriers faced by startups and encourage the creation of new high-growth companies in Paraguay.

Training Hundreds of Innovation Professionals

PROINNOVA II also places strong emphasis on developing human capital in the innovation sector.

The program will train more than 600 private-sector professionals in key areas including:

• Innovation management

• Technology transfer

• Green and sustainable innovation

• Intellectual property management

• Open innovation strategies

In addition, 500 public-sector officials will receive specialized training to strengthen institutional capacity and improve the design and implementation of innovation policies.

Aligning with National Development Goals

The initiative supports Paraguay’s broader economic strategy to increase productivity, diversify its economy and promote sustainable development.

By strengthening innovation and technological capabilities, policymakers aim to boost competitiveness and foster long-term economic growth.

The program is also aligned with the IDB Group’s Country Strategy with Paraguay for 2025–2029, which prioritizes innovation, institutional strengthening and sustainable economic development.

Long-Term Financing Structure

The approved loan includes favourable financing conditions, with a maturity period of 24.5 years and a six-year grace period before repayment begins.

The interest rate will be based on the Secured Overnight Financing Rate (SOFR), the international benchmark used for many multilateral development loans.

The IDB said the investment will help Paraguay strengthen its innovation ecosystem and expand opportunities for entrepreneurs, researchers and businesses to develop new technologies and compete in global markets.