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Economic Overview

Uruguay has the highest income per capita and the largest middle-class share in Latin America, but it faces challenges in boosting growth. The economy grew by 5.3% annually from 2003 to 2014, but only 1% from 2014 to 2019, and 0.7% between 2019 and 2023. According to the Central Bank, Uruguay's economy grew by 3.1% in 2024, driven by improved agricultural yields after the previous year’s drought, higher hydropower generation, increased trade, and greater cellulose production. However, positive results were partially offset by the negative performance of the construction sector, as the Central Railway project, linking UPM's second plant to the Port of Montevideo, was completed. Growth is expected to stabilize at around 2.6% in 2025-2026, converging towards its potential. Private consumption is forecast to remain strong as inflation pressures ease, while fixed investment is projected to increase as global financial conditions gradually improve (World Bank).

The deficit and debt outcomes in 2023 were in line with the fiscal rule targets. Adherence to the rule for four consecutive years helped stabilise the debt-to-GDP ratio despite a series of negative shocks. The pension system reform, approved in May 2023, is expected to stabilize spending in the medium term. According to the latest figures released by the Ministry of Economy and Finance, the fiscal deficit of the consolidated public sector was 4.1% of GDP at the end of last year. By 2026, the fiscal deficit is expected to further decrease to 2.7% of GDP as consolidation efforts continue. Net indebtedness is projected to stay within the legal limit, with public sector debt forecasted at 64-65% of GDP during the period (World Bank). In 2024, inflation ended at 5.49%, within the Central Bank's target range. The Consumer Price Index was slightly above the 2023 figure, which closed at 5.11% (data Central Bank). Average inflation is expected to remain relatively stable over 2025-2026.

Figures from INE show that, in December 2024, the national activity rate was 64.6%, the employment rate was 59.8%, and the unemployment rate was 7.4%. Uruguay has one of the highest levels of GDP per capita in South America and a developing middle class (USD 34,440 in 2024, as per the IMF). The country has had strong political and social stability for years, backed by a consolidated democracy and strong legal security, which makes it attractive to investors. Furthermore, the population living below the poverty line has decreased significantly in the past decade: at present, the percentage of households residing in poverty stands at 6.4%, as measured by the international poverty line of USD 6.85 per capita per day (World Bank).

 
Main Indicators 2023 (E)2024 (E)2025 (E)2026 (E)2027 (E)
GDP (billions USD) 77.2482.4886.4290.4394.79
GDP (Constant Prices, Annual % Change) 0.43.23.02.62.4
GDP per Capita (USD) 21,65723,05324,08025,12126,253
General Government Balance (in % of GDP) -2.2-3.2-2.6-2.4-2.2
General Government Gross Debt (in % of GDP) 64.564.765.065.265.0
Inflation Rate (%) 5.94.95.45.14.8
Unemployment Rate (% of the Labour Force) 8.38.48.08.08.0
Current Account (billions USD) -2.91-2.27-2.22-2.13-2.03
Current Account (in % of GDP) -3.8-2.7-2.6-2.4-2.1

Source: IMF – World Economic Outlook Database , October 2021

Country Risk

See the country risk analysis provided by La Coface.

 

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Main Sectors of Industry

Uruguay’s natural resources are very limited, mainly due to the country's size. There is a significant mining industry in the country, which mainly revolves around basalt, dolomite, limestone, quartz, granite, and marble. There is only one gold-producing mine in Uruguay, and the country is a major producer of cement and semi-precious stones, particularly agate and amethyst. Even though only around 11.6% of the land is arable, agriculture is the largest export sector in Uruguay. It accounts for 5.6% of the GDP and employs 8.7% of the active population. Uruguay has rich agricultural land and almost 90% of it is devoted to livestock breeding (cattle, sheep, horses, and pigs). Rice is the main crop, followed by wheat, maize, sugar cane, soybeans, and tobacco. Vegetable and fruit farming are also present throughout the country, as well as a prominent wine industry along the coast of the Rio de la Plata. In 2023-24, Uruguay's main export product was once again beef: the total revenue from the meat sector amounted to USD 2.637 billion (-2.6% compared to 2022/2023), of which 80% was beef, 11% consisted of by-products (primary, residual, and processed), and offals accounted for 4.2% of total exports. For beef, the equivalent volume in carcass weight was 527,902 tons, marking an 11.3% increase compared to the previous year. It is important to note that this value is the second highest of the decade and exceeds the 10-year average by 60,000 tons (467,662 tons – data INAC).

The industrial sector contributes to 16.4% of the country's GDP and employs 19% of the active population. Agriculture and animal food processing account for half of the industrial activity. Other manufacturing activities include beverages (especially wine), textiles, construction materials, chemicals, oil, and coal. Additionally, Uruguay has invested heavily in the paper industry, which is expanding. The manufacturing sector as a whole is estimated to account for 9% of GDP. According to the latest data from the National Institute of Statistics (INE), in 2024, industrial production grew by 1.8%: the biggest contributor was paper manufacturing (+14.5%, +1.8 pp), driven by cellulose. Food product manufacturing rose 2.2% (+0.9 pp), with growth in fruit and vegetable processing. Pharmaceutical products increased 13.2% (+0.79 pp), and computer/electronic products (+24.6%) and leather products (+18.1%) also showed strong performance. On the downside, petroleum refining dropped 13.6% (-0.5 pp) due to the La Teja refinery shutdown, while motor vehicle manufacturing fell 13.4% (-0.4 pp).

The services sector contributes to 66.3% of the GDP and employs 72.3% of the active population, mainly in finance and tourism. Particularly, the region around Punta del Este attracts a large number of visitors, which has driven the rise in building, leading to a construction boom in the area in recent years. However, the country welcomed 3.34 million tourists in 2024, marking a 13% decrease year-on-year (data Ministry of Tourism). The structure of Uruguay's financial system comprises two public banks, eleven private banks, and a diverse array of non-banking institutions.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 8.7 19.0 72.3
Value Added (in % of GDP) 5.6 16.4 66.3
Value Added (Annual % Change) 5.1 -3.7 1.1

Source: World Bank - Latest available data.

 
Monetary Indicators 20162017201820192020
Uruguayan Peso (UYU) - Average Annual Exchange Rate For 1 USD 30.1628.6830.7335.3042.01

Source: World Bank - Latest available data.

 

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Foreign Trade

Uruguay has an open economy, with foreign trade representing 52% of its GDP, according to the World Bank's latest available data. Uruguay enjoys special preferential access to trade with several countries under ALADI’s Economic Complementation Agreements. In 2023, the ranking of exported products was led by beef, constituting 18% of the total exports. Cellulose held the second position with a comparable share, followed by dairy products, beverage concentrates, rice, meat by-products, wood, soybeans, and vehicles. The largest import category in 2023 was industrial supplies, accounting for 28% of the total, followed by vehicles and their parts (17%), and food and beverage (14% - data Uruguay XXI).

The main destination for Uruguay's exports in 2023 was China, accounting for 22% of the total, closely followed by Brazil with 19%. The European Union ranked third with 16%, while the United States and Argentina represented 8% and 5%, respectively. On the other hand, Brazil was the top source of Uruguay's imports, accounting for 24% of the total, with a value of USD 2.557 billion. China followed as the second-largest source, representing 22% of imports. The European Union ranked third, with imports worth USD 1.580 billion, a 4% increase. Argentina was the fourth-largest source, contributing 6% of total imports (data Uruguay XXI).

As Uruguay mainly exports agricultural products, they are highly vulnerable to international price fluctuations. In 2023, exports of goods stood at USD 9.19 billion against USD 12.48 billion in imports (-17.8% and -3.7%, respectively); whereas services exports (at USD 6.39 billion) were higher than imports (USD 6.02 billion – data WTO). According to preliminary government figures, Uruguay's goods exports reached USD 12.84 billion in 2024. The top exports included cellulose, beef, soybeans, dairy products, and beverage concentrate. Excluding petroleum, derivatives, and energy, goods imports totalled USD 10.87 billion in 2024.

 
Foreign Trade Values 20192020202120222023
Imports of Goods (million USD) 8,2467,56410,32012,97312,486
Exports of Goods (million USD) 7,6806,8649,53511,1849,193
Imports of Services (million USD) 4,7513,5283,9235,4516,021
Exports of Services (million USD) 5,3573,7293,7465,4736,397

Source: World Trade Organisation (WTO) ; Latest available data

Foreign Trade Indicators 20192020202120222023
Foreign Trade (in % of GDP) 49.746.756.858.851.7
Trade Balance (million USD) 3,1132,2574,7304,0802,134
Trade Balance (Including Service) (million USD) 3,7812,4304,5264,2052,746
Imports of Goods and Services (Annual % Change) 1.9-12.617.912.46.0
Exports of Goods and Services (Annual % Change) 5.2-15.913.59.80.7
Imports of Goods and Services (in % of GDP) 21.821.124.826.924.2
Exports of Goods and Services (in % of GDP) 27.925.632.032.027.5

Source: World Bank ; Latest available data

Foreign Trade Forecasts 20242025 (e)2026 (e)2027 (e)2028 (e)
Volume of exports of goods and services (Annual % change) 8.34.64.34.03.5
Volume of imports of goods and services (Annual % change) 1.34.95.55.24.7

Source: IMF, World Economic Outlook ; Latest available data

Note: (e) Estimated Data

 
International Economic Cooperation
Uruguay is member of the Latin American Integration Association. It also belongs to the Mercosur, and has signed a free trade agreement with Mexico. The country have signed a trade agreement with 21 other countries in the São Paulo Round of the Global System of Trade Preferences among Developing Countries (GSTP).
 

Main Partner Countries

Main Customers
(% of Exports)
2023
Brazil 20.5%
China 16.8%
United States 8.1%
Argentina 5.0%
Türkiye 2.8%
See More Countries 46.7%
Main Suppliers
(% of Imports)
2023
Brazil 21.9%
China 19.1%
Argentina 12.0%
United States 8.8%
India 2.6%
See More Countries 35.6%

Source: Comtrade, Latest Available Data

 

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Political Outline

Current Political Leaders
President: Yamandú ORSI Martínez (since 1 March 2025)
Next Election Dates
Presidential: November 2029
Legislative: October 2029
Main Political Parties
Uruguay has a multi-party system with three dominant political coalitions. Outside of these coalitions, it is extremely difficult for any other political party to achieve electoral success. The dominant political forces are:

- Broad Front (FA): center-left coalition comprising various groups, including the Movimiento de Participación Popular (MPP), the Socialist Party (PS), and Vertiente Artiguista (VA). After a period in opposition, the FA returned to power in March 2025 with Yamandú Orsi as president
- National Party (PN): conservative party, nationalist, liberal, also referred to as the "White Party"
- Colorado Party: centre-right, a liberal and social-democratic party, one of the most elected parties in Uruguayan history
- Open Cabildo (Cabildo Abierto): right-wing, populist, conservative
- Independent Party (PI): centre, a social democratic and Christian socialist party, advocates "Third Way" - an alternative to the traditional left and right-wing politics
- Ecologist Radical Intransigent Party (PERI): centre to centre-left, green politics, liberal
- Popular Unity (UP): coalition of left-wing and far-left, Marxist-communist, anti-imperialist
- Party of the People (Partido de la Gente): right-wing, populist, conservative
- Green Animalist Party (PVA): centre to centre-right, green conservatism, animal rights, direct democracy
- Workers' Party (Partido de los Trabajadores): far-left, Trotskyist, socialist
- Digital Party (Partido Digital): the party advocated for e-democracy and is against being labelled either right, centre, or left.

Executive Power
The President of the Republic is both the Head of State and the Head of Government and is elected by universal suffrage for a five-year term. While the President may be reelected any number of times, immediate reelection is not allowed by the Constitution.
Legislative Power
Parliament is bicameral. The General Assembly is made up of the Chamber of Senators, which is composed of 30 members directly elected to serve 5-year terms; and the Chamber of Representatives, composed of 99 members directly elected to serve 5-year terms.
 

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