History of Paraguay (to 1811) Buenos Aires in 1580, the steady deterioration in the importance of Asunción contributed to growing political instability within the province. In 1617 the Río de la Plata Province was divided into two smaller provinces: Paraguay, with Asunción as its capital, and Río de la Plata, with headquarters in Buenos Aires. With this action, Asunción lost control of the Río de la Plata estuary and became dependent on Buenos Aires for maritime shipping. In 1776 the crown created the Viceroyalty of Río de la Plata; Paraguay, which had been subordinate to Lima, now became an outpost of Buenos Aires. Located at
History of Paraguay History of Paraguay The history of Paraguay is a result of development and interaction of varying cultures of indigenous peoples in Paraguay and overseas immigrants who together have created the modern-day Paraguay. Paraguay celebrates Independence Day on May 15, from 1811 to now. William E. Barrett wrote: "Paraguay is the country of prophecy. One of the two smallest nations [as of 1952] on the American continent, it was the first American communistic state, the first American nation to be governed by an absolute dictator (in the modern sense of the term)." The first Spaniards reached this territory in early 16th