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08 Otoño
May 20100
Shipbuilding Industry
Investment Opportunities in Uruguay
2
WHY INVEST IN THE URUGUAYAN SHIPBUILDING INDUSTRY?
In 2006, a promising phase began in the Uruguayan shipbuilding industry sector favored by intense commercial activity in the port of Montevideo. As a result, the shipbuilding industry has been operating with a high degree of installed capacity utilization. Invoicing has exceeded USD 20 million per year with new domestic and international investments being made. Given the forecasts for strong demand, new investments are continually appearing.
The industry’s current demand results from high levels of activity and profitability of other sectors, including: transportation, fisheries, petroleum, defense and security services, research, tourism and others.
Uruguay has numerous advantages that are leading to expanded development of its shipbuilding industry:
The port of Montevideo is located at a strategic position along the Atlantic coast of South America.
Proximity to large fishing areas.
Proximity to a maritime corridor with high traffic of Panamax and Post-Panamax ships.
Good international reputation for services.
Potential market for construction of barges and tugboats.
Creation of a local cluster with significant government support and commitment.
Favorable legal framework for shipyards.
Highly qualified and specialized human resources.
Industry description
The shipbuilding industry includes various activities, such as: construction, transformation, repair, maintenance and dismantlement, as well as manufacturing of machinery and accessories. This industry requires high levels of capital and is intensive in terms of highly skilled labor.
The shipbuilding industry has two classifications: heavy and light. The former includes fleets for river and ocean transportation, while the latter entails mainly sport, tourism and coastal fishing vessels.
Uruguay Shipbuilding Industry Cluster Association
In 2007, the Uruguayan Shipbuilding Industry Cluster Association began to take shape when the government and the private sector assumed the responsibility of transforming the
3
industry through a clustering of the sector. The aim was to increase competitiveness and to become an active tool and meeting point for all players that participate in ship construction and repair activities.
With economic support and methodology of the European Union, the Shipbuilding Cluster consolidated between 2007 and 2009, through the drive and coordination of the Ministry of Industry, Energy and Mining.
The cluster has active participation from over 50 players including shipbuilders, shipyards and dockyards, from private and government sectors, maritime shops, suppliers, education institutions, private and government organizations and the sector employees’ union.
Currently, the Shipbuilding Industry Cluster Association’s new strategic plan has the following guidelines: (i) education and training, (ii) technology and innovation, (iii) market and (iv) shipbuilding industrial pole.
South Atlantic Shipbuilding Industrial Pole
In February 2010, the Uruguayan government and the Uruguay Shipbuilding Industry Cluster Association signed a gratuitous loan agreement to access an 87-hectare government-owned property for the development of a shipbuilding industrial pole near the port of Montevideo. The aim is for Cluster members to carry out productive shipbuilding projects, either individually or through joint ventures with domestic or foreign investors.
This pole will be able to be used by Cluster Association members or by other companies working through joint ventures with Association members. Investments will be made with private capital and will be used exclusively by the investors themselves. Users of the pole shall make payments to the Cluster Association for maintenance, technology and training.
This area will be suitable for the construction of the following:
1. Repair docks whose sole function is ship repair, excluding any type of commercial port activities.
2. Dry and floating docks, synchrolifts, drydocking and vessel launching ramps, travelift and any other means for drydocking vessels.
3. Shipyards can be set up for vessel construction or vessel parts in various materials.
4. The following shops can be set up: repair, boiler, mechanic, electricity, electronics, carpentry, hydraulics, refrigeration, etc.
5. Ship construction support shops can be set up for treating surfaces, tubing, boilers,
etc.
The site will have a technology center and a training center. Those interested in participating in the pole must present their project for evaluation to the Cluster Association administrative commission. The shipbuilding pole will be responsible for all national, municipal and environmental permits.
4
Location of the South Atlantic Shipbuilding Industrial Pole
The Uruguayan market and the region
Uruguay
The country is in a central geographic location for maritime and terrestrial networks in the southern region of South America. Sustained port activity growth in the capital city of Montevideo and a firm push towards multimodality to enable Uruguay to become a regional logistics pole offer a promising future that can lead to increased ship traffic in the country’s ports. As such, developing a large ship repair center in the South Atlantic is a possible and achievable goal that has been set by the recently created Uruguay Shipbuilding Industry Cluster Association.
Since its onset in the 18th century, the shipbuilding industry in Uruguay has had peaks of activity in terms of both construction and repair, but has also seen lows, mainly in construction. However, in terms of repairs, activity has been sustained throughout time, with various levels of intensity.
Currently, Uruguay is seeing an increase in demand for ship repair, mainly due to the sustained growth in port activity and significant demand by the fishing fleet.
In terms of ship construction, there have been recent local investments that required the construction of barges, which in addition to possible additional increases in demand have led to an upsurge in activity, not just in terms of production, but also in investment, infrastructure and technology.
5
Physical Volume Index
Ship production has been on the rise over the past few years. In 2009, the sector's Physical Volume Index was 43% above the base year (2006). The year 2007 saw a peak in activity with a 62% increase as compared the base year.
Employed Personnel Index
The employment indicator shows that in the last three quarters of 2009, the sector had improved as levels are clearly higher than in previous years. The highest value was seen in the last quarter of 2009, reaching 204 (base year 2006).
Source: Uruguay XXI’s calculations based on data from the National Statistics Institute (INE).
9683
98
123141
166
190
138 131
154139 131 135
197187
204
0
50
100
150
200
250
Uruguayan shipbuilding industry employment index
87 81
11095 100
162
145 143
0
20
40
60
80
100
120
140
160
180
2002 2003 2004 2005 2006 2007 2008 2009
Uruguayan shipbuilding industry physical volume index (vessel construction and repair)
Source: Uruguay XXI's calculations based on data from the National Statistics Institute (INE).
6
On average, the Employed Personnel Index for 2009 was 81% higher in comparison to the base year.
In terms of the number of workers, according to figures studied by members of the shipbuilding industry cluster, the largest private company (Tsakos Industrias Navales) employs between 300 and 400 operators, including permanent staff, seasonal staff and contractors. The navy’s repair and construction service employs 150 operators and the remaining specialized shops have an average of 10 operators.
Number of vessels entering the port of Montevideo
In 2009, 4,881 vessels entered into the port of Montevideo, 7% less than in 2008. This is an unavoidable consequence of the drop in world trade during 2009, which was of about 12.2% in terms of volume according to the World Trade Organization.
Until 2008, international trade had risen faster than the global economy, leading to a boom in the ship construction industry and the appearance of shipyards in Asian countries that have absorbed 90% of worldwide vessel production. Asian countries have positioned themselves as the main exporters in the industry.
In terms of competition or regional shipbuilding industry complementation, we must consider the region’s countries (Argentina and Brazil) and the Paraguay – Paraná – La Plata River Hydroway.
Source: Uruguay XXI’s calculations based on data from the National Statistics Institute (INE). data.
River passenger Fishing Coastal and ocean
2006 747 2,134 2,264
2007 729 2,082 2,213
2008 676 2,352 2,204
2009 840 2,068 1,973
0 500
1,000 1,500 2,000 2,500
Number of vessels entering the port of Montevideo
7
Paraguay – Paraná – La Plata River Hydroway
The Paraguay – Paraná – La Plata River Hydroway is a transportation system serving mostly agricultural products (soy and others), minerals, (iron and manganese) and fuel. Large loads may be transported along the Hydroway.
It is the main river communication and transportation artery for the countries who share it: Argentina, Bolivia, Brazil, Paraguay and Uruguay. The region is considered to be one of the richest in Latin America. Its main rivers include the Paraná, Paraguay and Uruguay rivers.
This system is about 3,440 km long from the Cáceres port in the extreme north (Brazil) and the Nueva Palmira port in the extreme south (Uruguay). The Hydroway project ensures daytime and nighttime navigation throughout the year with convoys formed by various cargo barges.
It is the natural exit point for the production of large areas of
excellent productivity and has extensive possibilities for industrial development. These characteristics are a benefit for existing regional and emerging markets since they allow for the economic development of the countries involved.
Argentina
The Argentine industry is composed of a few, yet large shipyards as well as a large number of small and medium sized productive units. 80% of vessel construction and repair shipyards are located in the province of Buenos Aires.
The Buenos Aires Association of the Argentine Shipbuilding Industry and the Chamber of Shipbuilding Industries in Uruguay have an agreement entitled “Frame Agreement for Cooperation, Exchange and Aid” where the main objective is defined as “to join forces and
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strategies to carry out actions favoring each country in particular and Mercosur in general, and the mutual defense and benefit of labor, production, commerce and society.”
Number of vessels entering the port of Buenos Aires
In 2009, ship traffic in the port of Buenos Aires totaled 1,873 ships, 16% less than in 2008 (2,228). Of the ships that entered in 2009, 973 were coastal ships and the remainder were overseas ships.
2,228
1,873
1600
1700
1800
1900
2000
2100
2200
2300
2008 2009
Number of vessels entering into the port of Buenos Aires
900 overseas ships
973 coastal ships
Source: Uruguay XXI's calcculations based on statistics from the port of Buenos Aires.
Brazil
The Brazilian shipbuilding industry has over one hundred shipyards that have the capacity to build ships ranging from small fishing vessels to large sophisticated ships. 70% of these shipyards are located in Rio de Janeiro. Likewise, other shipyards are located in shipbuilding development poles along the country’s littoral region. The Brazilian industry’s main clients are national builders and state-owned petroleum companies that are mainly financed by the Merchant Marine Fund (FMM).
The shipbuilding industry, which had poor performance at the end of the 1990s, started to recover in 2000 with the off-shore platform fishing sector, maritime support vessels, their equipment and components, and later, the refurbishment of Petrobras fleets and local purchasing plans. This led to construction contracts for 10 petroleum ships at a cost of USD 1,160 million for the renovation of the Petrobras fleet. Additionally, 42 new ships will be acquired in the next few years. Nevertheless, the Brazilian shipbuilding sector has the need to attract skilled labor, to overcome outdated technology and to expand production capacity.
The Rio Grande port is the southernmost ocean port in Brazil, and the second largest in terms of cargo movements in the country. Ship traffic in the Rio Grande port during the January-March 2010 period was 447 ships. In 2009, ship traffic totaled 2,983 ships, 7% less
9
than 2008, which had 3,214 ships. In the indicated period, ships with the greatest share were long haul ships.
1,426 1,354
1,4261,146
362
483
0
500
1000
1500
2000
2500
3000
3500
2008 2009 Jan - Feb 2010
Number of vessels entering the port of Rio Grande
Coastal
Interior navigation
Long haul
Prospects for sector investment
Saturated demand in Brazilian shipyards means that the surplus could be partially
attained by the Uruguayan shipbuilding industry and could even promote its
expansion in terms of investments. The Brazilian shipbuilding industry seeks to
supply itself mainly from ship parts.
Negotiations are underway with Brazil so that products that are manufactured in
Uruguay with Brazilian supplies are considered to be Brazilian for the 70%
consumption guidelines.
Over 1,600 barges use the Paraguay – Paraná Hydroway transporting products from
South America. 1,000 of these barges must be replaced soon and 2,000 must be
added. 3,000 barges are needed for the Hydroway over the next few years.1
1 Source: http://www.symbarge08.org/paginas/info_gral.php. Symbarge 08 is an event promoted by the Pan-American Institute of Naval and Port Engineering (IPIN) to ensure that the regional shipbuilding industry is able to face the great challenges posed by river logistics along the Hydroway.
Source: Uruguay XXI’s calculations based on statistics from the port of Rio Grande.
Coastal = 96 Interior navigation = 157 Long haul = 194
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Large investments and companies in the Uruguayan shipbuilding sector
The sector’s most notable fixed capital investments include a slipway, two drydocks owned by SCRA (the Construction, Repair and Armament Service of the Navy), a floating dock owned by Tsakos and one owned by the National Port Administration (ANP).
In 2008, construction ended for the last two tugboat barges by two member organizations of the Shipbuilding Chamber of a total of four that were built by Uruguay to transport cellulose pulp on the Uruguay River.
In the Appendix there is a list of some of the companies and workshops related to the industry.
Legal and tax framework
In terms of promotion and tax frameworks, there is a consensus that although some aspects could be improved, legislation for shipyards, slipways and docks is very good. The 1984 law states: “all taxes, including Value Added Tax, shall be excluded for the import of materials, raw materials, capital goods and in general everything necessary for the development of the national shipbuilding industry activity." It includes reimbursements for repair exports. Practically everything that is imported is exempt from taxes and there are no royalties. These exemptions for the sector offer advantages as compared to Brazil and Argentina. Furthermore, the Uruguayan customs system is more agile and flexible than that of Brazil and Argentina, which facilitates the entrance of supplies from the rest of the world.
Likewise, there are laws granting Corporate Income Tax (IRAE) exemptions when investments are made through consortiums and where there are over 150 employees.
11
APPENDIX
Domestic and foreign investment promotion
Foreign investors in Uruguay enjoy the same benefits as domestic investors and do not need prior authorization to set up in the country.
Law 16,906 (dated 7 January 1998) declares the promotion and protection of domestic and foreign investment of national interest. Decree 455/007 updated the regulations of this law. Investment projects in any industry that are submitted and promoted by the Executive Branch may use between 51% and 100% the amount invested as partial payment of the corporate income tax (IRAE), according to project classification. The normal IRAE tax rate is 25%.
In addition, moveable fixed assets and civil works are exempt from wealth tax (IP) and value added tax (IVA) can be recovered for purchases of materials and services for the latter.
Likewise, the law exempts import taxes and charges for movable fixed assets declared non-competitive to domestic industry.
Specific government incentives for the shipbuilding sector
Government participation in the development of the shipbuilding industry has been significant. For this reason, the development of port infrastructure has been one of the top priorities for the last few government administrations. The strategic development plan2 of the National Port Administration (ANP) emphasizes not only the port of Montevideo, but also the ports of Colonia and Sauce de Juan Lacaze3.
Highlights of ANP’s strategy for industry fortification include the following:
Boosting the development of a national port system with a vision of the future and a re-launch of the activity in Uruguay.
Shipbuilding Industry Cluster initiative.
International promotion and search for strategic agreements for national port development.
Improvements in management efficiency and expansion of infrastructure of the port of Montevideo.
Position Uruguay as a port and logistics pole for the region that connects Chile, Bolivia and Paraguay with the Atlantic Ocean.
2 Executive Branch decree 508/2008. 3 ANP Resolution 112/2009 states that the ports of Colonia and Sauce de Juan Lacaze shall be complementary ports as of 9 September 2009.
12
Initiative to develop a fishing terminal in Montevideo Bay to improve port activity and to enable improved operations of the shipbuilding industry at the port.
The Ministry of Defense also supports the development of the sector. In partnership with the private sector, the navy has made significant investments in infrastructure and personnel training for the construction of barges in light of the current outlook and in anticipation of the possible demands of the Hydroway.
Trade agreements and investment protection
General trade agreements
Uruguay has been part of the World Trade Organization (WTO) since its creation in 1995 and is part of the Latin American Integration Association (ALADI, 1980) along with ten South American countries plus Cuba and Mexico.
In the framework of ALADI, the Southern Common Market (Mercosur) was formed in 1991 with Argentina, Brazil and Paraguay. Mercosur became a customs union in 1995, with the free movement of goods, the elimination of customs duties and non-tariff barriers between countries, and a common external tariff for countries outside the bloc. Venezuela is currently in the process of joining Mercosur.
Within the framework of ALADI, Mercosur has signed free trade agreements with other countries in South America: Chile (1996), Bolivia (1996), Colombia, Ecuador and Venezuela (2004) and Peru (2005), and has an agreement with Israel (2007), all of which form respective Free Trade Zones, with tariff reduction schedules that should be completed no later than 2014/2018,
according to the country.
Uruguay also signed a bilateral free trade agreement with Mexico (2003), which allows for the free movement of goods and services between both countries.
Investment protection
Uruguay has signed investment security, protection and promotion agreements with 27 countries, including Finland, France, Spain, the U.K. and the U.S.
13
Specific trade agreements for the shipbuilding sector
The Uruguayan government was able to help lift Brazil’s double taxation on repairs made outside Brazilian borders, thus allowing for future repairs of the Petrobras fleet. These services could not be provided before on account of price competition.
The Montevideo Service Protocol, in effect since 2005, includes the complete liberalization of services among Mercosur countries within a ten-year period. Likewise, Brazil has already liberalized repair services of its ships abroad for members, although these may not be paid with resources from the Merchant Marine Fund.
In effect since 1975, the Maritime Cargo Transport agreement with Brazil grants exclusivity for transportation among its ports for companies from both nations. Since 1994, there has been a similar arrangement with Argentina with the Maritime Passenger Transport agreement.
General government export incentives
Refund of VAT paid for supply purchases
Refunds of VAT on purchases are made generally by discounting VAT charged on sales and paying the difference to the State. Since this tax is not charged on exports, VAT included in purchases of inputs is refunded at the request of the company. The DGI tax bureau extends credit certificates that can be used in paying other taxes.
Refund of other taxes
The State refunds other internal taxes that make up the cost of a product exported through a notional percentage on FOB value determined by the Executive Branch (currently 2%).
Temporary admission
Imported supplies, components, packaging and molds that will be incorporated in the production of exported goods are exempt from both customs duties and Value Added Tax. The only requirement is for exports to occur within a period no greater than 18 months.
If the final product has imported supplies of 50% or less of the total value, it remains of Mercosur origin, which is required for intra-zone tariff exemptions. This system is set to expire in 2010 for Mercosur, but is expected to be renewed.
Export financing
The Central Bank of Uruguay (BCU) has an export pre-finance system. If pre- or post-export bank financing is obtained, 30% (or 10% in some cases) can be deposited in the BCU, which will pay interest on the total financing amount rather than only on the deposit.
14
Special customs systems
Free Zones
There are the 10 Free Zones or customs enclaves for manufacturing activities or services to third countries where customs duties and taxes are not paid on entry and exit of goods and services. In addition, broad exemptions from national taxes are granted, such as the IRAE income tax, but not for social security payments for domestic personnel.
A minimum of 75% of Uruguayan citizens on total staff is the only requirement, although this percentage may be reduced with prior approval by the Executive Branch.
Free Port and customs warehouses
Montevideo and other ports in the country operate under a system enabling the free movement of goods, which are exempt from applicable import taxes and surcharges for activities including handling, fractioning, repackaging, etc. (that do not imply manufacturing).
Private or bonded warehouse systems
This system grants companies the possibility of having enclosed areas where the merchandise is stored (in transit) with authorization from Customs. In-transit merchandise can be unloaded or reloaded at any given moment, free of import and export taxes and any internal taxes.
There are three types of private warehouses:
(i) Commercial warehouse: merchandise can only be the objective of operations to ensure conservation, impede deterioration and facilitate dispatch, such as revising, weighing, removing samples, repairing, substitution and re-labeling bulk items and all other analogous operations that do not increase the value nor modifies its nature; likewise remittances can be fractions but bulk items many not be fractioned.
(ii) Bonded warehouse: merchandise can be also the objective of operations destined to facilitate commercialization, such as fractioning, conglomerating and conditioning bulk items, mixing, selecting, classifying, dividing and establishing assorted lots or larger volumes and all other analogous operations that increase the value of the merchandise without changing its nature.
(iii) Industrial warehouse: merchandise can be the objective of operations destined to change its nature, including the addition of local parts, articles and products such as industrialization of raw materials, semi-manufactured products, adjustments, assembly, mounting, vehicle finishing, machinery and all other analogous transformation operations.
15
When merchandise from abroad stored in private or bonded warehouses authorized for such purposes enters the local market, it shall pay the corresponding taxes as if they came directly from outside the national customs territory.
When local merchandise enters bonded warehouses, it shall do so in accordance with applicable export laws.
Institutions
Shipbuilding Industry Chamber: The Shipbuilding Industry Chamber is the association representing the Uruguayan shipbuilding sector and is part of the Chamber of Industries of Uruguay. http://www.camaranaval.com
Uruguay Shipbuilding Industry Cluster Association: http://www.industrianaval.com.uy
Shipbuilding Companies
ANP: The National Port Administration is the Uruguayan decentralized service responsible
for port management.
ALIANZA ASTILLERO: Shop focused on ship repair and construction with more than 300 tons
of new ship block construction including bow and stern blocks, sides, wave breaking
bulkheads and more. Welding procedures and qualified welders at client’s request.
ASTILLERO GADATUR: Shipyard focused on vessel construction and repair specializing in
work boats. The company is currently in the process of building a vessel for the Maritime
Pilots Society of the Port of Montevideo with an innovative construction for this type of
vessel.
ASTILLERO NEREUS: Shipbuilder focusing on recreational fiber glass vessel construction.
Representative for Zodiac boats and Suzuki outboard motors. The company has large
facilities for the repair of fiberglass vessels.
ASTILLERO VICTORIANO: Shipbuilder focusing on innovative, high added value recreational
fiberglass vessel construction. Currently, the company is in the process of working with
Brazilian shipbuilders for the development and production of vessels for this market niche
internationally.
LEONER: Works in mechanics and boilers and is focused especially on floating repairs.
METALDIS: Currently works on equipment and facilities for the manufacture and repair of
parts, pipes, stainless steel, mechanized parts, alignment and balance of axels for propeller
shafts in small vessels.
16
MOVILUNO: Company focusing on electrical, electromechanical and hydraulic repairs and
currently represents Damen Shipyards of Holland. Specializes in logistics management for
large projects.
NITROMAR S.A.: A maritime shop mainly dedicated to the repair, modification and
refurbishment of vessels. Staff members with more than 25 years of experience in
shipbuilding. Work is generally performed floating on the port of Montevideo, with the
support of its facility’s shop.
RIN S.A. MARINE ENGINEERING: Founded in 1974, the company has experience in ship and
container repairs and has been working in drydocks for 31 years. The company repairs 80%
of the fleet of ships in the port of Montevideo.
STARSIKOL: Maritime shop specializing in ship motor mechanics. Company has investments
in specialized lathe and gasket making machinery. Represents ZF for ship transmission and
propulsion systems and focuses on the repair and sale of motors and propulsion systems.
CONSTRUCTION, REPAIR AND ARMAMENT SERVICE OF THE NAVY (SCRA): This company is
dedicated to repair and construction of all types of ships entering the La Plata River.
TALLERES EL TIMÓN: Shop with excellent staff in mechanics and adjustments. Floating and
drydock ship repair. Has advanced slipway project on littoral where it currently performs
repairs.
TIFEREY: Recently created joint venture by partners with long history in maritime activities
as builders, operators and specialized shop owners. Currently developing a project to set up
in the Shipbuilding Pole.
TSAKOS INDUSTRIAS NAVALES S.A.: The Tsakos group participates in maritime activities
through a fleet of over 70 ships, with an approximate transportation capacity of 8 million
tons and an international presence with offices located on five continents. The Tsakos
shipyard in Uruguay is located in the heart of the natural port in the city of Montevideo. The
Tsakos group has offices in 11 countries with Montevideo being its only office in South
America.
VARADERO DINVERT: Constructed by the Kambara firm of Japan. The company is focused
on ship repair and construction. Its 24 hectare surface area has an 80-meter long, 30-meter
wide and 4-meter deep ramp. Works with fishing boats, tugboats and barges.
17
Specialized maritime suppliers
AEROMARINE: Company focused on the supply, development and maintenance of advanced
electronic systems, marine electronics, radio communications, satellite communications and
broadcasting. Company represents many parts and equipment suppliers in the sector.
ENDUMAR: Company focused on manufacture and assembly of pipework, sandblasting,
shotblasting and painting of piping. Also performs industrial electromechanical assemblies,
pantograph metal cutting and manufacture of ship parts. Currently transforming its systems
to clean technologies.
GEOTEC: Company focused on meeting demands for goods and services in areas including oil
hydraulics and hydraulic mechanical elements, electronics and IT.
IMPROMET: Engineering service company focused on industrial solutions in metallurgy,
construction, equipment assembly and complete industrial plants. Has 1,300 square meters
of space for manufacturing.
MARINE SURVEYOR GROUP: A group of companies and associates dedicated to consulting
related to construction and operation of ships and their cargo, as well as land and air transport,
accident investigation, ship and facilities protection and other activities.
MERCOSURVEY: Company dedicated to consulting related to construction of ships, repair, ship
operation, cargo, accident investigation, ship and facilities protection and other activities.
Performs implementation of quality systems including OHSAS 18000.
RENNER: Industry and Maritime Division has made high performance anti-corrosion paints
for over eight decades.
SANDONATO: Metallurgy company focusing on the shipbuilding market.
SCINCE TECHNOLOGIES: Company focused on satisfying market demand in the area of Non
Destructive Testing (NDT) in all techniques. Has top level NDT with ASNT certification,
complemented with approved equipment for each application.
TURBOPOWER: Shop specializing in repair of all types of marine motor turbos. Has latest
equipment in the area of dynamic balancing of rotors.
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Uruguay at a Glance (2009)4
Official name República Oriental del Uruguay (Oriental Republic of Uruguay)
Location South America, bordering Argentina and Brazil
Capital Montevideo
Surface area 176,215 km
2. 95% of the territory has soil suitable for agriculture and
livestock activities. Population 3.3 million
Population growth 0.3% (annual)
Per capita GDP USD 9,458
Per capita GDP (PPP) USD 13,019
Currency Uruguayan peso ($)
Literacy 98%
Life expectancy at birth 76 years
Form of government Democratic republic with presidential system
Political divisions 19 departments
Time zone GMT - 03:00
Official language Spanish
Main Economic Indicators 2004-20094
2005 2006 2007 2008 2009
Annual GDP growth rate 7.5% 4.3% 7.5% 8.5% 2.9%
GDP (PPP) USD millions 32,048 34,602 38,235 42,543 43,551
GDP, USD millions (current) 17,367 20,035 24,262 32,207 31,606
Exports (USD millions), goods and services5 5,085 5,787 6,936 9,291 8,551
Imports (USD millions), goods and services 4,693 5,877 6,775 10,217 7,775
Trade surplus / Deficit (USD millions) 393 -90 166 -926 796
Trade surplus / Deficit (% of GDP) 2.3% -0.5% 0.7% -2.8% 2.5%
Current Account Surplus / Deficit (USD millions) 42 -392 -212 -1,502 258
Current Account Surplus / Deficit (% of GDP) 0.2% -2.0% -0.9% -4.7% -0.8%
Overall fiscal balance (% of GDP) -0.4% -0.5% 0.0% -1.4% -2.2%
Gross capital formation (% of GDP at current prices) 16.5% 18.6% 18.6% 20.2% 19.1%
Gross national savings (% of GDP) 17.6% 16.9% 19.0% 17.9% 17.1%
Foreign direct investment (USD millions) 847 1,493 1,329 1,840 1,139
Foreign direct investment (% of GDP) 4.8% 7.5% 5.4% 5.7% 3.6%
Exchange rate peso / USD 24.5 24.1 23.5 20.9 22.5
Reserve assets (USD millions) 3,071 3,097 4,121 6,329 8,373
Unemployment rate (% of EAP) 12.2% 11.4% 9.7% 7.9% 7.7%
4 Source: GDP data was taken from the IMF; data on foreign trade, FDI, exchange rate, international reserves and foreign debt was provided by the Central Bank of Uruguay (BCU); population growth, literacy, unemployment and inflation data comes from the National Statistics Institute (INE). 5 2008 and 2009 data includes a partial estimate of production activity in Free Zones and the information regarding the survey coordinated with CUTI for software related activities.
19
Investor Services
About Us
Uruguay XXI is the country’s investment and export promotion agency. Among other functions, Uruguay XXI provides no cost support to foreign investors, both those who are evaluating where to make investments as well as those currently operating in Uruguay.
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