A Year in Uruguay: Uruguay's Economy

Uruguay's Economy

From the CIA World Factbook Economy - overview:	Uruguay's well-to-do economy is characterized by an export-oriented agricultural sector, a well-educated work force, and high levels of social spending. After averaging growth of 5% annually during 1996-98, in 1999-2002 the economy suffered a major downturn, stemming largely from the spillover effects of the economic problems of its large neighbors, Argentina and Brazil. For instance, in 2001-02 Argentina made massive withdrawals of dollars deposited in Uruguayan banks, which led to a plunge in the Uruguayan peso and a massive rise in unemployment. Total GDP in these four years dropped by nearly 20%, with 2002 the worst year due to the banking crisis. The unemployment rate rose to nearly 20% in 2002, inflation surged, and the burden of external debt doubled. Cooperation with the IMF helped stem the damage. A debt swap with private-sector creditors in 2003 extended the maturity dates on nearly half of Uruguay's then $11.3 billion of public debt and helped restore public confidence. The economy grew about 10% in 2004 as a result of high commodity prices for Uruguayan exports, a competitive peso, growth in the region, and low international interest rates, but slowed to 6.1% in 2005.
GDP (purchasing power parity):	$32.96 billion (2005 est.)
GDP (official exchange rate):	$13.24 billion (2005 est.)
GDP - per capita (PPP):	$9,600 (2005 est.)

# posted by Chuck Stull @ 9:56 AM

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