Could Uruguay become the Southern Cone business hub?
SPONSORED CONTENT: With its strategic location and strong economic foundation, Uruguay is increasingly becoming a top choice for international investors looking for stability, transparency, and sustainability, writes Dr. Sebastián Risso Clerc, Executive Director, Uruguay XXI...
Recognized for its political, economic and social stability, Uruguay consistently ranks highest in Latin America for democracy, low corruption, civil liberties, rule of law, social mobility, and e-government development. This strong institutional structure provides a solid base for business operations, enabling investors to confidently plan for the long term.
Furthermore, Uruguay exemplifies one of the world’s highest performances in ESG (Environmental, Social, and Governance), on par with Europe. This underscores Uruguay’s commitment to sustainability and responsible business practices, further enhancing its attractiveness to global investors.
More than 400 European companies have trusted Uruguay to develop their activities, making the continent one of Uruguay's main trading partners and investors. According to information from Uruguay XXI, in 2022 alone, the countries of the European Union collectively accounted for 37% of the foreign direct investment stock in the country (USD 12 million). This significant European presence underscores Uruguay's appeal and reliability as a business destination.
Competitive tax regime
A significant attraction for investors is Uruguay's comprehensive tax benefits and incentives aimed at drawing foreign businesses. The Free Trade Zone and Investment Promotion Law are particularly remarkable, offering substantial tax exemptions and benefits that remain consistent across different government administrations. For example, goods in transit through Uruguay are exempt from customs duties and local taxes, making the country an ideal hub for regional distribution. Additionally, trading activities enjoy minimal tax rates, while software exports are entirely exempt from income tax, attracting numerous tech companies to establish operations in Uruguay.
Several multinational companies have chosen Uruguay as the location for their Latin American headquarters, attracted by the high quality of life and supportive regulatory frameworks. Sabre, Unilever, McDonald’s, and other major corporations have centralized their regional operations here, leveraging Uruguay’s strategic location and attractiveness for expats.
Companies like Ricoh, Shimatdzu, AstraZeneca or GSK centralize their regional distribution, benefiting from Uruguay’s logistics cluster advantages. Firms such as Syngenta, Trafigura Merck and BASF optimize their commercial activities from Uruguay while handle a very diversified set of support activities.
Uruguay’s tech ecosystem is particularly vibrant, with over 500 companies, including Mercado Libre, Globant, TCS and Verifone, focusing on IT development and innovation.
Sustainable hub
In terms of sustainable production, Uruguay excels in agribusiness-food and renewable energy. The country’s agribusiness chains, including forestry, dairy, meat, grains, and fruit, are highly competitive and export-oriented, meeting the standards of demanding global markets.
Uruguay’s commitment to renewable energy is evident in its more than 95% renewable energy matrix, making it a regional leader in green energy. Investment opportunities abound in green hydrogen production, wind and solar energy, and synthetic fuels.
Uruguay boasts world-class infrastructure and a highly skilled workforce, further enhancing its business-friendly environment. The country features a multilingual, flexible, and creative talent pool supported by a strong education system, making it an attractive destination for businesses and professionals. Global giants like Pepsico and Nestlé have successfully established manufacturing hub operations in Uruguay, leveraging its strategic advantages and favorable business climate.
Uruguay’s appeal extends beyond its economic attributes. The country offers a peaceful and diverse environment, attracting professionals and their families. This high quality of life and dynamic and innovative business landscape make Uruguay an ideal hub for regional and global operations.
Uruguay’s proactive approach to utilizing its renewable energy capabilities and solid institutional framework positions it well for future growth. As more global and regional companies choose Uruguay as their operational hub, the country is ready to support and drive their success in the competitive international market.
In Uruguay XXI our team specialized in investment promotion and aftercare, provides free support to the international investor from the prospecting, during the landing and once established.
The unique combination of the country's attributes together with an outstanding track record, make up a solid value proposition, which allows us to position ourselves as the #1 Business and Innovation Hub in Latin America and proclaim: Come, Test, Invest and Stay in Uruguay!