Journalists covering Paraguay's borders with Brazil and Argentina confronted a series of attacks and threats from smugglers and drug traffickers who operate openly in the region.

High tariffs in Brazil and Argentina have turned Paraguay's border towns into a smuggler's haven, where powerful businessmen, working with corrupt local officials, run a lucrative trade in everything from electronics to perfume. In recent years, Paraguay has also become a popular route for drug traffickers moving cocaine from Colombia. Journalists covering the border towns of Pedro Juan Caballero and Ciudad del Este are facing growing risks. In one dramatic example, the former mayor of Ciudad del Este was arrested in March for trying to arrange the murder of the national correspondent for the leading Asunción daily ABC Color.

The Paraguay Journalists Union also expressed alarm about a sharp increase in defamation lawsuits, including charges filed by a construction company partially owned by President Juan Carlos Wasmosy. According to reports published in Paraguay and elsewhere, the construction company diverted government funds during the construction of the massive hydroelectric plant in the town of Itaipú.

The Journalists Union has expressed concern that a victory by former general Lino Oviedo in the presidential elections of May 1998 could represent a threat to freedom of expression, given Oviedo's hostile attitude toward the press. Oviedo denounced the press for reporting his involvement in a 1996 coup attempt against President Wasmosy. Despite being ousted as army commander, Oviedo won the 1997 presidential nomination for the Colorado party, which has dominated Paraguayan politics for decades. Former dictator Alfredo Stroessner, who ruled Paraguay for 35 years until 1989, was a member, as is the current president.

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