Asunción is the capital and largest city of Paraguay. The city is located on the left bank of the Paraguay River, almost at the confluence of this river with the River Pilcomayo, on the South American continent. The Paraguay River and the Bay of Asunción in the northwest separate the city from the Occidental Region of Paraguay and Argentina in the south part of the city. The rest of the city is surrounded by the Central Department.
The city is an autonomous capital district, not a part of any department. The metropolitan area, called Gran Asunción, includes the cities of San Lorenzo, Fernando de la Mora, Lambaré, Luque, Mariano Roque Alonso, Ñemby, San Antonio, Limpio, Capiatá and Villa Elisa, which are part of the Central Department. The Asunción metropolitan area has around two million inhabitants. The Municipality of Asunción is listed on the Asunción Stock Exchange, as.
Asunción is one of the oldest cities in South America and the longest continually inhabited area in the Río de la Plata Basin; for this reason it is known as "the Mother of Cities". From Asunción the colonial expeditions departed to found other cities, including the second foundation of Buenos Aires and other important cities such as Villarrica, Corrientes, Santa Fe and Santa Cruz de la Sierra.
Asunción is considered a 'gamma city' by the study GaWC5. It is the home of the national government, principal port, and the chief industrial and cultural center of the country. Near Asunción are the headquarters of the CONMEBOL, the continental governing body of association football in South America. Asunción is said to be one of the cheapest cities in the world for foreign visitors.
The Spanish conquistador Juan de Ayolas (died c. 1537) may have first visited the site of the future city on his way north, up the Paraguay River, looking for a passage to the mines of Alto Perú (present-day Bolivia). Later, Juan de Salazar y Espinosa and Gonzalo de Mendoza, a relative of Pedro de Mendoza, were sent in search of Ayolas, but failed to find him. On his way up and then down the river, de Salazar stopped briefly at a bay in the left bank to resupply his ships. He found the natives friendly, and decided to found a fort there in August 1537. He named it Nuestra Señora Santa María de la Asunción (Our Lady Saint Mary of the Assumption – the Roman Catholic Church celebrates the Feast of the Assumption on August 15).
In 1542 natives destroyed Buenos Aires, and the Spaniards there fled to Asunción. Thus the city became the center of a large Spanish colonial province comprising part of Brazil, present-day Paraguay and northeastern Argentina: the Giant Province of the Indies. In 1603 Asunción was the seat of the First Synod of Asunción, which set guidelines for the evangelization of the natives in their lingua franca, Guaraní.
In 1731 an uprising under José de Antequera y Castro was one of the first rebellions against Spanish colonial rule. The uprising failed, but it was the first sign of the independent spirit that was growing among the criollos, mestizos and natives of Paraguay. The event influenced the independence of Paraguay, which subsequently materialised in 1811. The secret meetings between the independence leaders to plan an ambush against the Spanish Governor in Paraguay (Bernardo de Velasco) took place at the home of Juana María de Lara, in downtown Asunción. On the night of May 14 and May 15, 1811, the rebels succeeded and forced governor Velasco to surrender. Today, Lara's former home, known as Casa de la Independencia (House of the Independence), operates as a museum and historical building.
After Paraguay became independent, significant change occurred in Asunción. Under the rule of Gaspar Rodríguez de Francia (in office 1813–1840) roads were built throughout the city and the streets were named. However, during the presidency of Carlos Antonio López (President 1844–1862) Asunción (and Paraguay) saw further progress as the new president implemented new economic policies. More than 400 schools, metallurgic factories and the first railroad service in South America were built during the López presidency. After López died (1862), his son Francisco Solano López became the new president and led the country through the disastrous Paraguayan War that lasted for five years (1864-1870). After the end of the armed conflict, Brazilian troops occupied Asunción until 1876.
Many historians have claimed that this war provoked a steady downfall of the city and country, since it massacred two thirds of the country's population. Progress slowed down greatly afterwards, and the economy stagnated.
After the Paraguayan War, Asunción began a slow attempt at recovery. Towards the end of the 19th century and during the early years of the 20th century, a flow of immigrants from Europe and the Ottoman Empire came to the city. This led to a change in the appearance of the city as many new buildings were built and Asunción went through an era more prosperous than any since the war.