The US and Paraguay have signed an agreement with global stevia firm, PureCircle, to promote the cultivation of the stevia-derived sweetener Rebaudioside A (Reb A) in the south of Paraguay.

Paraguay Vende, the economic growth programme of the United States Agency for International Development (USAID), and the government of Paraguay made the announcement yesterday (12 October), which involves a mutual investment agreement.

Activities will range from sourcing of dry stevia leaves and extraction, refining of crude extracts into sweeteners and marketing of these sweeteners to food and beverage manufacturers worldwide.

PureCircle corporate VP of supply chain, Dorn Wenninger, said: "This is a very significant development for the Reb A and stevia industries. The decision by USAID and the government of Paraguay to select and invest with PureCircle, illustrates the enormous commercial opportunities and socioeconomic benefits that stevia cultivation is bringing to South America. This is a very proud and significant day for stevia in the region."

A report by industry bank Rabobank last month found that sales of the non-caloric sweetener could reach US$700m within five years, though it warns that there are numerous hurdles still to overcome.

Rabobank said that the potential market for Reb A in the US appears to be considerable. In 2008, the global high intensity sweetener market was valued at approximately $1.3bn, with the US accounting for approximately 35% ($455m).