THINK of Latin America, and Uruguay might not be the first country that springs to mind.
With a population of 3.3 million and a GDP of just under $55bn – roughly 10% of its larger neighbour, Argentina – it’s a relatively small market for trade.
But as a stable country with strong institutions, Uruguay performs well on all major transparency and ease of doing business indexes, according to the UK Foreign Office.
And, as the Institute of Export points out, it can be a good base from which to make inroads into the continent.
“Transparency, a sound legal framework, respect for the law, an excellent logistics platform, highly qualified resources, a strategic location… with a natural port, and free-trade zone legislation, are some of the advantages of Uruguay as a hub from where to tackle Argentina and Brazil.
“Uruguay is an interesting market in itself, with the highest per capita income of the whole continent (together with Chile).”
In 2015 the value of UK exports to Uruguay doubled to £246m, with goods accounting for 90% of that figure. The UK imported £98m in goods and services in the same year, official figures show.
According to the UK Department for International Trade, the most-traded goods were:
- Beverages, spirits and vinegar (27.7% of all UK goods exported to Uruguay)
- Mineral fuels or oils, products of their distillation (22.9%)
- Pharmaceutical products (15.1%)
- Machinery and mechanical appliances (7.7%)
- Essential oils and resinoids; perfumery (5.4%)
- Meat and edible meat (36.6% of all UK goods imported from Uruguay)
- Wood and articles of wood; wood charcoal (17.5%)
- Pulp of wood or other fibrous cellulose material (15.2%)
- Cereals (6.6%)
- Edible fruit and nuts (5.5%)
As Clipper crews arrived in Punta del Este, about 80 miles east of the capital Montevideo, on September 21, they would have found a liberal, modern and secure country.
The Uruguay-British Chamber of Commerce describes a good quality of life, highlighting low crime levels, a lack of ethnic tension, few traffic jams and a low cost of living, as well as many bilingual schools.
And with the yachts safely in port after a 6,363 nautical mile-leg from Liverpool, the race’s longest, the British government announced it was increasing UK Export Finance (UKEF) support for Uruguay from £2.25bn to £4bn.
UKEF supports British exporters, and overseas buyers sourcing from the UK, by guaranteeing loans or directly providing finance – often with long repayment terms – for projects in areas such as infrastructure. The British Embassy in Uruguay says it has helped finance the construction of bridges, airports, refineries, buses and hospitals.
And the UK government appears keen to secure trade with the South American nation post-Brexit, with International Trade Minister Mark Garnier meeting Uruguayan Foreign Minister Rodolfo Nin Novoa during a trip to coincide with the Clipper Race’s arrival. Novoa is expected to meet Foreign Minister Boris Johnson in London next week.
In 2015, Uruguay imported $3.3bn of goods and services from the EU – more than from Argentina, Brazil or China – with around $2.5bn coming in the opposite direction.
A Foreign Office overseas business risk profile says Uruguay’s economy has become more resilient, with diversification of exports helping GDP grow at an average of 5.5%.
“Commodities dominate Uruguay’s exports, principally beef (representing 17% of total exports) and cellulose (representing 15% of exports).