The purpose of this paper is to analyze the recent transformations experienced by the city of Encarnación (Paraguay), as a result of its new urban development, influenced by the effects of the additional work done on the Yacyreta hydroelectric dam, built by Argentina and Paraguay on the Parana River. Based on an exploratory and descriptive research approach, I argue that there has been a change in the patterns of urban land occupation, not only because of the growth of the reservoir located in the Parana River (new waterfront) and the consequent relocation of the population affected, but also due to the emergence of urban renewal processes, regeneration, and high-quality public works. All these changes have resulted in a new urban configuration of the city and an architectural modernism that is generating new public spaces, sanitation, infrastructure, and new opportunity structures for urban life. Among them are the creation of extensive beaches on the riverfront and new business areas. However, on the other hand, the massive displacement of poor people toward other urban or peripheral areas has rapidly enabled a new fragmentation of the city.
Among other conclusions, we will argue that, despite having highlighted the benefits of the urban transformation that the city is undergoing, Encarnación is experiencing a differential change of its urban space characterized by accentuated and discontinuous interventions in different socio-spatial spheres and the creation of an increasingly more segregated city, causing a disconnect between the new, highly qualified central areas and the new urban peripheries