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
Revolt of the Comuneros (Paraguay) their streets and enforcing the new governor's rule. This wound never healed. By 1721, hatred of the Jesuits was even more intense than it was in the early 1600s. In 1717, Diego de los Reyes Balmaseda became governor of Paraguay. He purchased the position from the Spanish authorities, a practice that had spread at the time. Reyes was a merchant who had made his fortune trading exporting yerba mate from Paraguay and importing various cheap and needed manufactures back to Paraguay, so he was seen as qualified for the post by the Spanish Crown. Reyes was an open admirer of