How Did Paraguay Get So Rich?

Getting back to Paraguay and López and Lynch…

In the Nineteenth Century, Paraguay was extremely wealthy. It had the first railroad and the first telegraph in South America. It had an armaments factory designed and run by English engineers. Its neighbors feared its strength and envied the powerhouse of its monopoly on a substance that was in enormous demand, the sale of which poured wealth into the country. Not gold mines, nor silver, nor precious gems. Paraguay’s wealth derived from a tea—yerba mate.

Until the War of the Triple Alliance or the Paraguayan War, 1865-1870—López and Lynch’s time, Paraguay was the only

place where Ilex paraguareiensis grew. The shrub or small tree bears leaves that once dried and steeped in hot water produces an elixir that was drunk by Paraguay’s indigenous Guaraní people before the Spanish arrived in the sixteenth century. By the mid-17th century, its popularity had spread to Argentina, Chile, Bolivia, and Peru. And to Europe and the Middle East. There may have been an awful lot of coffee in Brazil, but its citizens drank more yerba mate. It was at that point that the Jesuits domesticated the plant and began to grow it on their Indian reductions.

[Interruption for a commercial: If you haven’t seen the movie The Mission, I urge you to—it is gorgeous, with great performances by Jeremy Irons and Robert De Niro and splendid music by Ennio Morricone. And now back to our story.]

Yerba mate contains caffeine and other mild stimulants. It is traditionally drunk from a gourd through a silver straw called a bombilla. South Americans often get together with friends to drink a mate, which they pass around among them always clockwise. The tea is believed to have healthful and medicinal properties. Researchers are currently looking into its use as a cancer-fighting agent, particularly against colon cancer.

At the beginning of the War of the Triple Alliance, Paraguay had a monopoly on the product. More than defeating Paraguay, Brazil, Argentina, and Uruguay devastated the country. And then to keep it down for a hundred years, they took away most of its yerba mate producing territory. Now Paraguay is last among the countries that produce the product that made it rich 150 years ago.

Annamaria Alfieri