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Since April 1998, the New Zealand Ambassador in Buenos Aires has been accredited to Uruguay. Previously, the accreditation was from Santiago. New Zealand also has an Honorary Consul in Uruguay, Manuel (Mac) Herrera.
New Zealand agricultural science is highly respected in Uruguay. For some decades, New Zealanders have been associated with World Bank consultancies aimed at enhancing Uruguay agricultural development. New Zealand livestock has been exported to Uruguay (the Corriedale breed dominates Uruguay’s large sheep flock) and Uruguayan plants have been used in New Zealand drought research. Other areas of mutual interest include pasture development, herd/bull progeny testing, and agricultural training.
Numbers of Uruguayans have studied agriculture related subjects at New Zealand universities during recent years under NZAID tertiary-level study awards. Other technical coooperation funded by NZAID has included activities in the areas of viticulture/oenology, standards and conformance training, farm management, dairy industry familiarisation and scoping of a possible carbon sink accounting system for Uruguay. The Latin American Development Programme funds two scholarships per year for Uruguayan students to study in New Zealand, preferably in the field of good governance.top of page
According to the March 2006 census 297 persons normally residing in New Zealand had been born in Uruguay (up from 60 in 2001). Immigration statistics indicate that 35 permanent residence applications for Uruguayans had been granted in the 2005/06 financial year, with a further 23 approved by March 2007.
Visas are no longer required by New Zealanders or Uruguayans visiting each other’s countries for up to three months.
A Working Holiday Agreement was signed during the Prime Minister’s visit to Uruguay in November 2001, providing for working holiday exchanges of 100 people aged 18-30 in each direction each year. The scheme became operational in October 2003. 22 Uruguayans participated in the scheme during the first year to October 2004. The uptake is steadily increasing with 49 participants in 2005, 59 in 2006 and 95 by September 2007.
Bilateral trade with Uruguay is small, with New Zealand imports around USD 370,000 from and exports around USD 5.3 million to Uruguay (year to June 2007). There have been no recent significant trade access issues. top of page
New Zealand and Uruguay cooperate in several multilateral fora. Uruguay is a fellow member of the Cairns Group and shares New Zealand’s objectives for open, unsubsidised world agricultural trade. The two countries collaborate on a range of United Nations issues including in the areas of human rights and the environment, and have an active dialogue on Antarctica and Southern Ocean fisheries matters. In September 2006 the Assistant-Chief of Defence Force-AC SCI (Strategic Commitments and Intelligence), Brigadier Warren Whiting, visited Montevideo for bilateral consultations on UN peacekeeping operations.
New Zealand commodity exports to Uruguay for the June 2007 year totalled USD 5.3 million, an increase from USD 3.3 million in the June 2006 year. The main items were agricultural machinery and equipment, animal products and sugars. New Zealand commodity imports from Uruguay for the same period totalled USD 373,000, slightly down from USD 377,000 in the June 2006 year. The main items were animal pharmaceutical products and woven fabrics.
Wrightson has a 51% stake in Uruguay Seed Supply company Semillas Pas and in December 2006 launched a share float for NZD 150m to invest in agricultural land and farming systems through a new company New Zealand Farming Systems Uruguay (NZFSU). AgResearch has signed a joint venture with Argentine seed company Gentos and Uruguayan agricultural research institute INIA to develop and sell plant cultivars in South America. INIA has research relationships also with Lincoln and Massey Universities. New Zealand firms have been involved in upgrading Uruguay dairy processing facilities.
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Land Area - 177,500 sq km
Population - 3.4 million
Capital City - Montevideo
Religion - Predominantly Catholic
Language - Spanish
Currency - Peso
Political system - Republic
National government-elect - Encuentro Progresista-Frente Amplio (EP-FA Broad Front)(took office on 1 March 2005)
National legislature - Bicameral congress of 31 member senate and 99 member chamber of deputies (proportional representation)
Last election - October 2004
Next election due - October 2009
Head of State - Dr Tabaré Vázquez
Head of Government - Dr Tabaré Vázquez
Main political parties - Encuentro Progresista Frente Amplio (EP-FA Broad Front),
Partido Nacional (Blancos) , Partido Colorado (PC),
Nuevo Espacio
GDP USD 19.3 billion (2006)
GDP breakdown - Goods 40%; Services 60%
GDP per capita USD 5,848 (2006)
Real GDP growth 7% (2006)
Exports USD 4.389 billion (2006)
Imports USD 4.862 billion (2006)
Main exports (2006) - Meat and products: USD 1.016 billion (23%);
Hides and skins: USD 340 million (8%); Processed rice: USD 218 million (5%);
Wool and wool products:
USD 162 million (4%)
Current account -USD 456 million (2006) -
Inflation (CPI) 6.4% (2006)
Gross external debt USD 11.7 billion (2006)
NZ Exports (FOB) USD 5.3 million (year to June 2007)
Main Exports -
Unidentified (HS 98.09): 31%;
Medicaments: 18%;
Agricultural Machinery: 9%;
Agricultural Equipment: 5%
NZ Imports (CIF) USD 373 (year to June 2007)
Main Imports - Animal products: 23%;
Woollen products: 20%
New Zealand and Uruguay have an easy affinity based on similarity of size, southern hemisphere co-location and the role of agriculture in external trade. The two countries cooperate closely on international agricultural trade access issues in the WTO and the Cairns Group. As a fellow dairy exporter, Uruguay shares common interests with New Zealand on international dairy access issues. A Working Holiday Agreement was initiated between the two countries in October 2003. Uruguay’s economy was strongly affected by Argentina’s economic crisis in 2002/03 but economic growth resumed during 2003, accelerated strongly in 2004 and has continued at a steady pace ever since at above 6%. The Presidential election in October 2004 resulted in a historic victory for the EP-FA broad left coalition under Dr Tabaré Vázquez, breaking 170 years of continuous dominance by the traditional centre-right political parties. The new EP-FA government took office on 1 March 2005. Prime Minister Helen Clark met with President Vázquez in Chile in March 2006. The next Presidential elections will be held in October 2009.
The Oriental Republic of Uruguay is one of the smallest countries in South America, located on the northern bank of the River Plate. Uruguay's long tradition of democratic rule was interrupted in 1973 by a period of military dictatorship. Since the restoration of democratic government in 1985, regular elections have been held, most recently in October 2004. In that election, the Encuentro Progresista-Frente Amplio (EP-FA) broad left coalition led by cancer specialist and former Mayor of Montevideo, Dr Tabaré Vázquez, won a historic victory ending 170 years of political dominance by the traditional Colorado and Blanco (National) Parties. Dr Tabaré Vázquez took office as President on 1 March 2005.
Close to 90% of the country is suitable for agricultural production and of this, 85% is devoted to pasture-based stock rearing, 4% to crops and 4% to forestry. Uruguay is an important producer of livestock. It has about 12 million head of cattle and some 30 million sheep.
Now halfway through his five year term, President Vázquez still enjoys widespread support (consistently polling above 50% approval), and his EP-FA coalition has worked through internal divisions to remain stable. Strong pressure from unions and other groups contributed to the government reducing US Free Trade Agreement (FTA) negotiations to a more palatable Trade and Investment Framework Agreement (TIFA). An upsurge in crime in the capital led to the resignation of Interior Minister José Díaz in March 2007, who was replaced by Socialist Party member Daisy Tourné.
Despite these and other challenges, the economy is nonetheless underpinned by strong and steady economic growth, the FA coalition remains firmly in control and Economy Minister Danilo Asotri and Agriculture Minister José Mujica remain lead contenders for the 2009 presidential election (which the constitution forbids the incumbent from contesting).
Uruguay has three main political forces: the Partido Colorado (PC); the Partido Nacional (PN), known as the Blancos; and the Encuentro Progresista-Frente Amplio (EP-FA) broad left coalition, known as the Broad Front. Each contains numerous factions.top of page
The services sector accounts for close to two-thirds of Uruguay’s economy, and industry for over one quarter, but agriculture remains of fundamental importance in the economy. Agricultural-related products account for more than half of the country’s exports and industrial activity is heavily oriented to the processing of agricultural products. Within the services sector, tourism and finance are important foreign exchange earners.
Uruguay’s main trading partners have been fellow Mercosur customs union members Brazil and Argentina, although the US and the EU have grown rapidly in importance since 2003.
Increasing employment and household incomes are the driving forces behind continued strong GDP growth, now at 6.7% (year on year in the first quarter of 2007), and into its fourth year above 6.5%.
Stoked by strong domestic consumption led demand growth, annual inflation remained above the government’s target 4.5 - 6.5% range, pushing 9% in the year to August 2007. While Central Bank policy is expected to take 2 base points off annual inflation by end 2008, this would nonetheless see the rate remain above the target range (which is to be further lowered to 4 - 6% in 2008).
Despite rising 1.4% in the six months to May 2007 (to 10.5%), unemployment has trended down over the past 18 months. It is expected to further decrease once employers have become familiar with new simplified and more flexible labour legislation and taxation system.
The government repaid its outstanding debt of USD 1.08 billion to the IMF at the beginning of December 2006. The payment was part of the government’s measures to improve Uruguay’s debt portfolio, as it successfully substituted short-term, high interest bearing debt due in 2007 for long-term loans maturing in 2022 and 2036. This further decreases Uruguay’s total external debt to GDP ratio to around 60% (down from around 100% in 2003)top of page
Uruguay is the smallest member of the Mercosur[1] Customs Union that also includes Argentina, Brazil, Paraguay and, though not yet fully ratified, Venezuela. This important association continues to be the primary focus of its external relations.
Internal trade has increased significantly during the union’s 12 year existence but the objective of a fully integrated common market is little closer to reality than at the outset and Paraguay and Uruguay have begun to question the value of the Union to its (much) smaller members. Presidents of the two largest members, Lula of Brazil and Kirchner of Argentina, reactivated efforts to deepen integration in 2003, attempting to expand policy convergence into the social and political spheres, including the setup of a Mercosur Parliament. Efforts have stalled however, notably over the larger members’ opposition to wider integration through the Free Trade Area of the Americas (FTAA) negotiations and the bitter dispute between Argentina and Uruguay over the construction of two paper mills.
The dispute centres on Argentine opposition to the construction of two paper mills on the Uruguayan bank of the shared Rìo Uruguay River. While Argentina contests that the mills threaten their country’s environment and tourist industry, Uruguay’s claims that the mills meet the highest international environmental standards have been upheld by the International Court of Justice. The mills further represent the largest single foreign investment in Uruguayan history, and at USD 1.8 billion (or around 9% of GDP) an enormous boost to employment and the economy. As the dispute escalates, protesters continue their 18 month roadblock of bridges between the two countries, at severe cost to Uruguay’s Argentine-dependant tourism sector, and talks between the two countries’ presidents, mediated by the King of Spain, are similarly mired.
Confronted with this intra-Mercosur divergence, President Vázquez has begun expanding his foreign policy beyond Latin America. Along with Paraguay, Uruguay now actively seeks approval from Mercosur to allow its smaller members to pursue bilateral trade agreements with countries not party to the Union. This approach is evident in particular in its engagement with the United States of America. While political disagreement within the ruling FA coalition ensured the negotiations in 2006 lead to a lesser TIFA rather than a full FTA, latest talks and high level visits in June 2007 have reactivated efforts for deepened economic links. Uruguay also recently joined the extra-Mercosur Banco del Sur.top of page
The Safetravel website provides a travel advisory for travellers to Uruguay [external link].
