According to Countryaah data, in the 16th century, there were three groups of people living in the basin of the Paraguay River: the Guaranians in the central part of the region, the Guayurus and the Payaguas in the Chaco region in the south. The guarans cultivated cassava, pumpkin, sweet potato and corn. They were residents of villages headed by a tubicha (a chief).
According to thesciencetutor, the Payaguas and Guayurus were hunters and fishermen and lived a nomadic life. They regularly attacked the Guarani plantations. These attacks were a decisive factor for the Guarani’s assistance to the Spaniards in the conquest of Chaco.
The Spanish conquerors who sailed up the Paraná River in search of the mythical silver mountains that gave the name to the region in the middle of the 16th century lived in the fort Nuestra Señora de la Asunción founded by Juan de Salazar in 1537. This small village was run of the next century capital of the province of Río de la Plata.
When the precious metal was not found and the area was considered “land without yield”, the conquerors’ financial interest was concentrated on cattle breeding. The cattle were bred in millions on the fertile plains of Banda Oriental and Pampa Húmeda. In the ports of Buenos Aires and Montevideo, a strong mediator oligarchy was developed and the old capital was relegated to second place.
While building around these cities pre-capitalist large estates, the Jesuits in the present-day Paraguay organized a missionary system in which the Indians jointly cultivated the land and developed their craft. The model, then characterized as “communist,” clashed with the interests of the bourgeoisie and the Jesuit order ended in 1767 to be expelled. The Indians went from being co-owners of a community to being slaves in Brazil or servants of the big estates.
Although the province of Paraguay did not join the Liberal Revolution in 1810, the oligarchy of Asuncion overthrew the Spanish governor Velazco on May 14, 1811, seeking free trade for their yerba mate (local tea) and tobacco. Thus began the process which led Gaspar Rodríguez de Francia to concentrate power in his hands, supported by the peasants, who consisted of small and medium-sized landowners who wanted order and feared that the ruling “anarchism” of the Viceroy would affect them. Paraguay closed itself inside. The oligarchy of Asunción, the only enemy of this development, was eliminated. Through state intervention, the development of national industries, which became the basis for future Paraguayan economic power, began.
Under Gaspar Rodríguez de Francias (“the Most High”), Carlos Antonio López ‘and his son Francisco Solano López’s patriarchal governments, Paraguay was for decades isolated from the outside world and developed – outside the British influence that, after independence, dominated the rest of Rio de la Plata’s provinces. Out of the reach of imperialism, the country became an economic powerhouse with state control of agricultural production (yerba mate and fine woods) and of the first railways, telegraphs and foundries in South America.
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Under the pretext of border demarcation, Presidents Pedro II of Brazil, Bartolomé of Argentina and Venancio Flores of Uruguay included the so-called «Tripel Alliance». It was supported by the English Empire and the Baring Brothers Bank and in 1865 launched a genocidal war against Paraguay.