INVESTMENT AND TRADING WITH
URUGUAY
Juan Martín Olivera
Seoul, South Korea
May 29, 2012
Misiones 1424, 2nd Floor
11000 Mon...
Uruguay: a small country among giants
Geographical location: South America, bordering
Argentina and Brazil
Area: 176,215 k...
Why Uruguay?
• Strongest democracy and social and political stability in Latin America.
• Continued economic growth and in...
Clear rules and political and social stability
Ranking Uruguay in South America
Low Corruption
(Transparency International...
Low Corruption
(Transparency International
2011)
New Zeland 1
Canada 10
Japan 14
Chile 22
USA 24
Uruguay 25
Spain 31
South...
Strong economy
0
1
2
3
4
5
6
7
8
9
2004 2005 2006 2007 2008 2009 2010 2011
Cumulative Annual GDP
Growth Rate (2004–2011): ...
BENEFICIAL REGIMES
FOR THE INVESTOR
Promotion of foreign investments
• Government recognizes the important role of the FDI and maintains a
favorable investmen...
Temporary admission regime
• Similar to a drawback regime, allows companies to import inputs free of
tariffs for up to 18 ...
Free Trade Zones
• FTZs are duty-free areas within Uruguayan territory.
• FTZs have developed as important poles of commer...
BUSINESS
OPPORTUNITIES
Information Technology and Telecomunications
• #1 software exporter in Latin America (US$ 68 per capita, followed by Costa...
Logistics and Transport
• Optimal logistic location in South America’s Southern Cone where the Río de la
Plata, Paraná and...
Forestry and Agriculture
• Uruguay is mainly an agricultural country where 70% of total exports are
composed of cattle mea...
Oil, Gas and Mining
• Despite the global crisis, british and french companies, plus other consortiums
have presented explo...
Renewable energies
• Hydro power is already a big energy source in Uruguay.
• Power generation from biomass and wind farms...
URUGUAY:
A GATEWAY TO MERCOSUR
Uruguay: a gateway to MERCOSUR
• Suitable market for the development
of international activities and an
attractive busines...
INVESTMENT AND TRADING WITH
URUGUAY
Juan Martín Olivera
Seoul, South Korea
May 29, 2012
Source:
Uruguay XXI – Investment a...
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Presentation investment and trading with uruguay

  1. 1. INVESTMENT AND TRADING WITH URUGUAY Juan Martín Olivera Seoul, South Korea May 29, 2012 Misiones 1424, 2nd Floor 11000 Montevideo, Uruguay Tel.: (598) 2916 58 59 Fax: (598) 2916 58 63 jolivera@olivera.com.uy www.olivera.com.uy
  2. 2. Uruguay: a small country among giants Geographical location: South America, bordering Argentina and Brazil Area: 176,215 km2 Population: 3.4 million Capital city: Montevideo Language: Spanish GDP: USD 40,265 million GDP per capita: USD 11,998 Literacy rate: 98.3%
  3. 3. Why Uruguay? • Strongest democracy and social and political stability in Latin America. • Continued economic growth and investment despite global slump. • Excellent labor value for money in the region, with highly skilled Human Resources. • Highest internet, broadband and PC penetration in Latin America. • Attractive free zone, free port and free airport regimes, and broad investment- related tax exemptions. • Access to MERCOSUR, a US$2,5-trillion-GDP free trade zone that also includes Argentina, Brazil and Paraguay.
  4. 4. Clear rules and political and social stability Ranking Uruguay in South America Low Corruption (Transparency International 2011) 2 Democracy Index (The Economist Intelligence Unit 2011) 1 Economic Freedom Index (Heritage Foundation 2011) 2 Prosperity Index (Legatum Institute 2011) 1 Political Stability (World Bank – World Governance Indicators 2011) 1 Quality of Living (Mercer Quality of Living City Ranking 2011) 1
  5. 5. Low Corruption (Transparency International 2011) New Zeland 1 Canada 10 Japan 14 Chile 22 USA 24 Uruguay 25 Spain 31 South Korea 43 South Africa 64 Argentina 100 Democracy Index (Economist Intelligence Unit 2011) Norway 1 New Zeland 5 Uruguay 17 USA 19 Japan 21 South Korea 22 Spain 25 Chile 35 Argentina 51 Colombia 55 Economic Freedom Index (Heritage Foundation 2011) Hong Kong 1 New Zeland 4 Chile 7 USA 10 Japan 22 Uruguay 29 South Korea 31 Spain 36 South Africa 70 Argentina 158 Clear rules and political and social stability
  6. 6. Strong economy 0 1 2 3 4 5 6 7 8 9 2004 2005 2006 2007 2008 2009 2010 2011 Cumulative Annual GDP Growth Rate (2004–2011): 5.8% 10,5 9,7 8,5 7,5 4 2,8 2,6 0 5 10 China India Uruguay Argentina Rusia Japan USA FDI percentajge of GDP (2010)
  7. 7. BENEFICIAL REGIMES FOR THE INVESTOR
  8. 8. Promotion of foreign investments • Government recognizes the important role of the FDI and maintains a favorable investment climate. • Domestic and foreign investors are treated equally. • Investments do not require prior authorization or registration. • No exchange control. Free transferability of capital and profits from foreign investments. • Investment projects may qualify for corporate Income Tax rebates ranging from 51% to 100% of the amount invested, plus rebates of other taxes. Corporate income tax is set at 25%.
  9. 9. Temporary admission regime • Similar to a drawback regime, allows companies to import inputs free of tariffs for up to 18 months, as long as these are used to produce goods to be exported. • Manufacturers can enter tariff-free: raw materials, supplies, parts and intermediate products used to manufacture products to be later exported. • Also covered under this regime are products that are consumed in the production process without being incorporated in the finished exported product, as well as containers and packing material.
  10. 10. Free Trade Zones • FTZs are duty-free areas within Uruguayan territory. • FTZs have developed as important poles of commercial and industrial activity and services for the rest of the world. • The entrance and exit of goods to and from the FTZ are not considered importations or exportations. • FTZ Companies are 100% exempt of: • Corporate income tax • Net Worth tax • Import levies • Any other tax created or to be created in the future • National monopolies are not applicable in FTZs.
  11. 11. BUSINESS OPPORTUNITIES
  12. 12. Information Technology and Telecomunications • #1 software exporter in Latin America (US$ 68 per capita, followed by Costa Rica with US$ 33) • #1 technology country in Latin America (Latin BusinessChronicle’s Latin Technology 2010 Index) • Highest total telephone penetration in Latin America:123 mobile lines per 100 residents in 2009 • Connection to Global Crossing cable due in 2012 will enable a much faster connectivity • Broad tax benefits
  13. 13. Logistics and Transport • Optimal logistic location in South America’s Southern Cone where the Río de la Plata, Paraná and Uruguay Rivers converge with the Atlantic Ocean. • Deep water ports operating under free port regimes. Important grains and chips terminal in the Montevideo port coming soon. • 65% of in-transit merchandise in the region goes through Uruguay • New airport terminal, new ring road in Montevideo and expansion of highway to conect all the coast. • Government has stressed the importance of renewing and expanding the highway infrastructure and important incentives are to be expected in future public bids.
  14. 14. Forestry and Agriculture • Uruguay is mainly an agricultural country where 70% of total exports are composed of cattle meat, wheat and mix of cereals, rice, milk and other dairy products. • Uruguay is one of the world's largest producers of soybeans, greasy wool, horse and cattle meat. • Forestry has experienced an outstanding development, representing 13% of the exports. Uruguay has received billionaire investments in two pulp mills and related business. Only 21,5% of the areas destined to forestry has been used.
  15. 15. Oil, Gas and Mining • Despite the global crisis, british and french companies, plus other consortiums have presented exploration and production bids for blocks off the Uruguayan coast at depths of between 50 and 2,000 meters • More explorations at the north of the country are scheduled. • This raises prospects for energy independence and within, in the future, a significant reduction in energy costs. • Important iron deposits have recently been found and are attracting foreign investments, which might place Uruguay in a position similar to Australia, Brazil, Canada or Sweden.
  16. 16. Renewable energies • Hydro power is already a big energy source in Uruguay. • Power generation from biomass and wind farms already in place, with important tax benefits. • Strategic development plan: add 500 MW of renewable energy to the national energy matrix by 2015 (200-300 MW wind, 200 MW biomass and 50 MW small hydro). • State-owned utility UTE’s public bid for 150MW of wind power is an important step in this sense. • Soon Uruguay will have Nº1 position in the Americas in the proportion of non- traditional renewable power generation capacity out of its total power capacity.
  17. 17. URUGUAY: A GATEWAY TO MERCOSUR
  18. 18. Uruguay: a gateway to MERCOSUR • Suitable market for the development of international activities and an attractive business center with a tradition of stability • Member of Mercosur together with Argentina, Brazil and Paraguay (Venezuela is under integration process) • Mercosur is currently a Customs Unions with a 200 million consumers market • Common tradition assures the continuity of the regional integration regime
  19. 19. INVESTMENT AND TRADING WITH URUGUAY Juan Martín Olivera Seoul, South Korea May 29, 2012 Source: Uruguay XXI – Investment and Export Promotion Agency www.uruguayxxi.gub.uy Misiones 1424, 2nd Floor 11000 Montevideo, Uruguay Tel.: (598) 2916 58 59 Fax: (598) 2916 58 63 jolivera@olivera.com.uy www.olivera.com.uy
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