Uruguay’s long-term commitment to growth

Gabriel Oddone joined Canning House in a business roundtable in which he explained the recent successes and challenges to the Uruguayan Economy. The minister explained that his two priorities were to accelerate growth and improve the social protection system.

Uruguay’s long-term economic growth is dependent on a continued commitment to multilateralism, the minister explained. Uruguay has a globalised outlook on its trade and investment realities: China is its principal trading partner for goods, the US for services, and the EU for foreign direct investment (FDI). At the same time, it trades extensively with its neighbours: Argentina and Brazil. As a result of this, Minister Oddone made it clear that Uruguay is keen to remain a member of a global trading network. The upcoming EU-Mercosur deal would provide a boost for the trading bloc. Uruguay’s commitment to global institutions is growing with explorations of membership of the CPTPP and the OECD.

The Minister turned to the domestic economy by explaining that energy and logistics are the two key industries in Uruguay. The rise of AI and increased demand for data centres has seen energy demand in the country climb. To meet this demand, the minister wants to maintain Uruguay’s environmental credentials; currently, 95% of Uruguay’s energy is renewable, and it was the first country in the world to issue sovereign bonds attached to environmental criteria. Innovations in the logistics industry aim to keep Uruguay competitive: green hydrogen technology is being explored while road and rail networks are being expanded.

The public sector retains wide support in Uruguay, the minister explained. However, the social protection system is under stress and is struggling to care for the country’s children. Economic growth is crucial to combatting this problem, for which Uruguay needs more investment. The minister also admitted that reform was needed to increase the efficiency of markets, particularly in the electricity and transportation sectors.

The minister made it clear that Uruguay remained a reliable destination for investment and long-term business growth. Canning House extends its thanks to the minister and wishes him the best for the rest of his time in London.