Air transport in Paraguay currently suffers a significant demand for routes and frequencies, but the lack of a consistent policy complicates development.
Although Paraguay is not one of the largest countries in Latin America, the poor development of land transport complicates transport between cities, leaving the plane as the best alternative to join the different parts of the country. However, the nation today has little development in this area, with only two private companies plus the Military Air Transport Service (SETAM) provided by the Air Force, as the only regular air services.
The biggest problem for development is the lack of an airport and support policy for private enterprises, which leads to the rates charged by private companies are excessively high. As an example, the company Sol de Paraguay charges $ 200 for a round trip ticket from Asunción to Encarnación, about 300 kilometers away. On the other hand, a ticket from Asunción to Bahía Negra (three hours of flight) through SETAM is worth around $ 80, because they have subsidized part of their costs.
The lack of infrastructure also complicates cabotage flights, since many towns have small runways, often unpaved and with few facilities for passenger or cargo service.
SETAM is a service that is already many years old, although in 1998 it had been interrupted and resumed in 2012, with the three Casa 212-200 a 212-400 and a DHC-6-300 Twin Otter that operates the Transportation Air Group of the Paraguayan Air Force, to which, when there is demand, the two Cessna Grand Caravan of the Special Transportation Air Group (GATE) are added. They are currently serving one flight per week to the towns of Concepción, Puerto Valle-Mi, Puerto Casado, Fuerte Olimpo and Bahía Negra, all over the Paraguay River. Sometimes, if there is demand, they divert to Toro Pampa that is inside the Chaco, west of Fuerte Olimpo.
Currently, the force is requesting a budget to be able to extend services to two weekly flights, due to the high demand there is.
In addition, the objective is to be able to extend the routes to other cities, such as Philadelphia, in the Chaco, Pilar, on the Paraguay River south of Asunción, Encarnación, and possibly Pedro Juan Caballero and Salto del Guairá, both on the border with Brazil.
Amaszonas Paraguay was born as a joint venture between the Bolivian company Amaszonas together with Avmax of Canada and Air Nostrum of Spain, with four Bombardier CRJ-200 Regional Jet and now the company has been reorganized with the departure of Amaszonas from society, so will shortly present a new name.
The company began an aggressive expansion of routes throughout the region, arriving in Argentina, Chile, Brazil, Peru and Uruguay, although a rationalization of them with the new direction is expected. As far as cabotage is concerned, it only flies from Asunción to Ciudad del Este, the second largest city in the country. It is currently the only cabotage service in Paraguay covered with jet aircraft.
For its part, Sol de Paraguay is born from a bus company, which in turn belongs to the Argentine company Crucero del Norte. In 2010, operations began with three Fokker 100, flying to Ciudad del Este and Buenos Aires from Asunción, but they could not develop a demand for such large aircraft with high operating costs, so in 2012 they stopped operating, resuming flights in January 2016 with a single Cessna Grand Caravan. Now, their routes cover the cities of Encarnación and Pedro Juan Caballero, which in July 2018 added Hernandarias, all in eastern Paraguay.
Now, the company expects to receive a second Grand Caravan by the end of the year, hoping to add as destinations to the cities of Philadelphia, Loma Plata and Neuland in the Chaco.
Currently, the entire Paraguayan west lacks air services, while the covered towns have few frequencies and with small airplanes, the 50-seater Regional Jet being the largest. The alternative that Paraguayans from the west of the country have to travel is only by land, on routes in very poor condition in which the trips are very long and tiring, so the plane is the ideal solution. To the east, where historically there has been more economic development, the routes are better and there is more competition with land transport companies. However, the Paraguayan Chaco has been developing enormously in the hands of agricultural and livestock production, generating a growing demand for better transport conditions.
However, the outgoing national government did not have an aero-commercial development policy, to facilitate the operation of the companies, with credits and other facilities to lower their costs, so that they could add more aircraft, routes and frequencies, while neither invested in improving infrastructure. Now, it is expected that the new government can take action towards the development of this sector.