Why invest in Uruguay

10 de April de 2010

Uruguay is a country that staunchly defends its constitutional democracy, its political pluralism and the individual liberties or its inhabitants. Consequently, on an international level, it has received a large degree of credibility, and has been recognized by diverse organisms as the safest place to invest in Latin America.

Uruguay is divided administratively into 19 departments, totaling 176,210 square kilometers, making it the second smallest country in the region. It borders Brazil (to the North, Northeast and East) and Argentina (to the West, along the River Uruguay, and to the South, along the River Plate). Colonia del Sacramento, for example, is port along the River Plate, located almost directly in front of Buenos Aires, only about an hour away by ferry.


The United Nations places Uruguay, on the Corruption Index, as the least corrupt Latin American country, a statistic also corroborated by Transparency International. In addition, Uruguay ranks highest on the Human Development Index, an important indicator which takes into consideration per capita income, life expectancy (72 years) and education (Uruguay is deemed the most literate country in Latin America).


Summer is considered to be the peak season, attracting tourists from all around the globe. Montevideo, Punta del Este (Maldonado), Rocha and Colonia are all common destinations. Interestingly enough, Uruguay is the only South American country whose boundaries are entirely located within the “temperate” zone, offering a pleasant climate, ranging from 17 or 18 degrees up to 35 degrees during the Summer.


The official language is Spanish. English, however, is the most relevant language of commerce, and Portuguese is commonly spoken in areas which border Brazil.


Uruguay’s strategic location, nestled between Brazil and Argentina, but also close to the Paraguayan border, makes it a natural conduit for communication between countries belonging to MERCOSUR. The ports of Montevideo, Nueva Palmira (Colonia) and Fray Bentos (Soriano) all represent strategic points, allowing for the importation and exportation of goods destined for the center of the continent, as well as the surrounding countries.


The majority of the country possesses essential services, such as water, light and communication. By and large, there is no restriction on use, and the quality is very good.




Investor Assurances:


Most importantly, Uruguay has instituted strict bank secrecy laws, making it the safest country for investing in South America. Political, economic and social stability further ensure the safety of one’s investments.


Not only is the safety of one’s investments virtually guaranteed (Never in history have foreign assets been expropriated. Furthermore, should this occur, the Constitution mandates that payment or just compensation be effectuated beforehand), but one’s personal safety is also guaranteed. Uruguay is considered to be the safest country in the region.


Uruguay is a member of various international organisms that promote investor security. Of notable mention are the Multilateral Investment Guarantee Agency (MIGA) and the International Center for the Settlement of Investment-Related Differences, whose headquarters are located in the Word Bank.



What follows is a list of some characteristics of our political-economic system:


  • Monetary freedom
  • The free transfer of assets and profits
  • Opening up to foreign trade
  • Work permits for foreign personnel
  • A member of MERCOSUR and other trade associations with big countries
  • Appreciation of rural and urban assets


Uruguay possesses a thriving, competitive economy, open to both regional and international investment, and largely sustained by the active participation of private capital. In order to foment this growth, our country has implemented a series of reforms which favor foreign and national investment. Some of the more important aspects are:


  • The aforementioned investors receive transparent and equal treatment.
  • Incentives are offered to people and companies working in productive areas, and are guaranteed as a result of the establishment of reliable legal, fiscal and financial frameworks. Moreover, the impartiality of the Uruguay’s justice system is beyond doubt; both the State and private companies respect and honor their contracts.
  • Private banks provide long-term financing for the purchase of land in accordance with the specific details of the project with a mortgage agreement or with internationally recognized bank guarantees.
  • Uruguay’s unregulated financial market and monetary freedom allow for the unrestricted movement of capital, dividends and profit.
  • Uruguay promotes the unlimited participation of foreign capital in its society.
  • Uruguay also seeks to deepen its development of the service sector, further stimulating industrial, commercial and financial activities.
  • There is no restriction on the repatriation of capital or profits.
  • A trade regime allowing for unrestricted importation and exportation, implemented using strategic mechanisms.
  • Uruguay is a fertile testing ground for products and novel concepts.
  • In addition to Uruguay’s bank secrecy laws, depositors can opt to keep their deposits in international currency (dollars or euros), therefor avoiding potential fluctuations in the market to which the local currency is subject. At any rate, in Uruguay there is monetary freedom and value dates remain fixed, having resisted the toughest economic crises that the region has faced.
  • There is a favorable import regime for capital goods.
  • The market conditions are ripe for growth. Excellent plots of land are available at low prices, and legislation has been approved for forestry projects.
  • It is worth noting that Uruguayan soil is among the most suitable in the world for forestry projects. As mentioned above, growth indices suggest that this is the optimal moment to launch such projects.
  • Given its size, everything in Uruguay is relatively close by. An excellent system of highways and roads connect every corner of the country.


Investment opportunities abound in Uruguay, both in the primary and secondary sectors. Potential investors are presented with a host of unique advantages and opportunities, not only as a result of Uruguay’s undeniable natural resources, but also due to a structured, top-down policy seeking to foment investment, which includes interesting stimulus packages and a supply of local skilled labor. Furthermore, Uruguay’s high quality of life is not to scoffed at, and it remains to be said that foreigners will always feel at home in this beautiful and fecund country.


Specifically in the department of Colonia, certain tax exemptions, which vary according to the amount of labor employed, are provided for industrial undertakings and hotel development. National law has also provided further exemptions, covering taxes imposed by the Bureau of Rural Property Tax, for real estate development on forest area land. The relief offered is equivalent to the size of the forest area.




Financial System:


Our financial system, controlled by the Central Bank of Uruguay, is composed of The Bank of the Oriental Republic of Uruguay (BROU), The Uruguayan Mortgage Bank (BHU), private banks, financial institutions (banking houses), the Montevideo Stock Exchange, among other banks of lesser scale. The Central Bank of Uruguay supervises and regulates the activities of all financial institutions, implements the exchange policy and, in addition to acting as the financial agent of the Government, regulates the whole financial system and is imbued with fiscal authority.


The BROU functions as a commercial bank where one must declare their commercial operations with foreign entities. Working in conjunction with the Central Bank of Uruguay, the BROU regulates the foreign exchange market and gives out credits. The BHU, on the other hand, authorizes loans for houses and construction projects.


In Uruguay, an atmosphere of trust and reliability has led banks and financial institutions to diversify the portfolio of services offered. Financial freedom, the evident commercial boom experienced by the Uruguayan economy, the deepening relationship between private investors who are non-residents and international financial institutions, as well as the marked stability that defines the financial relationship between international banks and multilateral financial organizations are all factors that have shaped the current state of Uruguayan economy.


Uruguayan’s financial system is known for its efficiency, a characteristic that has fostered its affiliation with numerous first-rate European and North American banks. And, as a result of this deepening relationship, regionally, the Uruguayan economy has grown in importance.


Bank deposits are kept in dollars. However, returns in local currency are often greater than the original deposits made in foreign currency. While the US dollar is the primary foreign currency, deposits can be made in any currency.


Loans are granted in foreign currency, almost 90% of which are destined to Uruguayan residents. Strict bank secrecy is guaranteed by law.


The preceding information outlines some of the fundamental guarantees that Uruguay offers potential investors. Economic growth and the opening of international markets ensure the profitability of said investments. In the end, however, the success of a given system boils down to those who implement it. Human decency, reliability and professionalism are all hallmarks of the Uruguayan. This is particularly true when it comes to our business. Should you have any doubts, 25 years of experience in real estate speak for themselves.



Other points of interest for visitors:


Immigration data:


Entrepreneurs and business men who visit our country are required to carry a valid passport, save for limited cases where a visa suffices. Residents of MERCOSUR nations, Argentina, Brazil, Chile and Paraguay, may enter using their DNI identity card.


Here is a link which lists Consulates and Embassies in Uruguay.


Links of interest:

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  • Top reasons to invest in Uruguay