Paraguay's President Santiago Peña met on Sunday in Campo Grande, the capital of Brazil's Mato Grosso do Sul state, with business leaders from the state's Federation of Industries (FIEMS) to promote investment opportunities in his country. The meeting, organized at the association's request, brought together representatives from sectors including bioenergy, food, construction and logistics.

Taiwan rolled out the red carpet for Paraguay President Santiago Pena on Friday to shore up relations with its only South American ally, as Beijing urged Asuncion to sever ties with Taipei.

Taipei has only 12 diplomatic allies after Beijing, which claims Taiwan is part of its territory, systematically poached the others in a bid to isolate the self-governed island.

Pena is leading a delegation of government officials and business representatives on a four-day visit, and has described the island as a “fundamental partner” for the South American country.

President Lai Ching-te officially welcomed Pena on Friday with military honours, including cannon salutes and red carpet, ahead of a sit-down meeting.

Addressing the military parade under grey skies, Lai thanked Pena and his government “for long speaking up for Taiwan on the international stage”.

“Taiwan and Paraguay are partners firmly committed to the values of democracy, freedom and human rights,” Lai said.

Pena said: “Paraguay deeply values this relationship and reaffirms its commitment to continue supporting Taiwan in a strategic alliance based on shared values.”

China’s foreign ministry called on Paraguay to “make the right choice” by cutting ties with Taiwan.

Since arriving Thursday, Pena has met with Taiwan’s vice president and other senior government ministers.

He also received an honorary doctorate from the National Taiwan University of Science and Technology, which he hailed as a reflection of the “solid alliance” between Taiwan and Paraguay.

‘Intense pressure’

During his meeting with Lai, Pena condemned Chinese military and economic pressure on Taiwan, and insisted Taipei has a “sovereign right to engage freely with other countries”.

Paraguay and Taiwan were to sign agreements on mutual legal assistance in criminal matters, cooperation in cybersecurity, as well as an AI and computing infrastructure investment project.

Taiwan’s other allies in the Americas are Guatemala, Belize and Haiti. It also has formal diplomatic ties with several Caribbean islands.

Pena’s visit comes days after Lai returned from an official trip to Eswatini, Taiwan’s only ally in Africa.

Taiwan has accused China of trying to stop Lai’s visit to Eswatini by applying “intense pressure” to the Seychelles, Mauritius and Madagascar to revoke overflight permits for his original trip, which had been scheduled for April 22-26 and was cancelled at the last minute.

Lai ended up using the Eswatini king’s plane to make the journey.

Lai’s last official overseas trip was in November 2024, when he visited Taiwan’s Pacific allies and transited through the US territory of Guam.

Pena had announced in July 2025 that Lai would visit Paraguay the following month. But the administration of US President Donald Trump reportedly denied Lai permission to transit through New York as part of the official trip to Latin America.

Taiwan’s foreign ministry denied that Lai was blocked.

Hundreds of Brazilians camped overnight on beach chairs, plastic benches and tarps outside an immigration center in Ciudad del Este, on the border with Brazil, to secure a spot in a Paraguayan government drive to fast-track residency applications. Some organized an improvised barbecue on a barrel while they waited. Others had traveled more than 1,500 kilometers by bus. All shared a common thread: the desire to leave Brazil for reasons they describe as political, economic and ideological, according to a report by BBC News Brasil.

The association agreement between Mercosur and the European Union (EU) enters provisionally into force on Friday May 1, after more than a quarter-century of negotiations, in what constitutes one of the world's most ambitious trade deals and the largest reciprocal opening ever finalised by the South American bloc. The final signing took place on January 17 in Asunción and, although final ratification by the European Court of Justice and subsequent approval by the European Parliament remain pending, provisional entry into force allows the immediate start of tariff reductions covering 95% of Mercosur products and 91% of EU products.

The presidents of Brazil, Luiz Inácio Lula da Silva, and Paraguay, Santiago Peña, agreed on Sunday in Campo Grande to intensify negotiations over Annex C of the Itaipú treaty, the instrument that governs the financial terms and energy sales of the binational hydroelectric dam, one of the largest in the world.

Foreign residency applications in Paraguay surged 85% in the first quarter of 2026, reaching 18,071 compared to 9,760 in the same period of 2025, the National Migration Directorate reported. Temporary residency requests jumped 105% to 14,995, while permanent residency applications rose 25% to 3,076.

The Capricorn Bioceanic Corridor, one of the most ambitious infrastructure projects underway in South America, is moving through its final stretch on the border between Paraguay and Brazil, with just twenty-one metres remaining to complete the physical link of the so-called Bioceanic Bridge, according to Paraguayan government authorities cited in late May 2026. The structure, built over the Paraguay River, will connect the cities of Carmelo Peralta, in the department of Alto Paraguay, and Puerto Murtinho, in the Brazilian state of Mato Grosso do Sul, and constitutes one of the central pieces of a logistics corridor that will link the Atlantic Ocean with the Pacific across four South American countries.