ABSTRACT
There is a virtual consensus among experts that an important contribution from the micro, small and medium enterprise (MSME) sector will be necessary if employment conditions in Paraguay are to be improved significantly. This conclusion is based on the combined implications of three related facts: (i) the sector accounts for almost all of the country’s non-agricultural employment; (ii) given the lengthy period of relative economic stagnation which the country has suffered, it would be optimistic to expect very rapid short term employment growth in any other sector (i.e., in the large private sector, the agricultural sector, or the public sector); (iii) a recent pattern in many Latin American countries, even those with moderately good growth rates, has been that neither large private enterprise nor the public sector contribute much to employment creation.
