A Year in Uruguay

Soccer is a huge sport in Uruguay, but not for girls. Field hockey is far more typical. My daughter was very disappointed when she heard that. In Kalamazoo, soccer is very big for both girls and boys. Most of my daughter's friends play on a team.

Luckily for us, girls and women have started playing soccer in Uruguay. My daughter started practicing with a team associated with Club Nacional, one of the major teams in Montevideo. She can't compete until she gets an official medical card. Her team has a very good coach and the girls have excellent ball-handling skills. They're fast, too. We watched them shut out their opponents 9-0 last Sunday.

Labels: sports, Uruguay

Elevators here are typically small. Our elevator holds five passengers, if they're friendly. (For my Kalamazoo College readers-- it's about the size of the elevator in Dewing Hall.) Some are smaller. When we arrived with our 6 suitcases, we had to take two trips. This points to a more general problem-- how does furniture get delivered? On the outside!

This queen mattress was being delivered to an apartment on our block. One worker attached the ropes and then joined his partner up on the sixth floor. The two guys just hauled the mattress up and pulled it in the window.

See a little movie of this here: http://www.youtube.com/watch?v=KqsR1IIbqgg

Labels: apartments, business, Uruguay, video

There are signs of Spring here, despite a return to cooler weather. These little flowers have been appearing in park lawns for the last few weeks. They're pretty but they get mowed down by the lawnmowers. Violets get about the same treatment in Michigan.

Labels: nature, seasons, Uruguay

Dulce de leche is the most popular sweet in Uruguay. It's a creamy milk caramel used in many ways. It can be spread on bread, like peanut butter. Many pastries are filled with dulce de leche. A popular snack, the yo-yo, is a thick layer of dulce de leche sandwiched between two cookies, then given a chocolate coating. Sweet, gooey, and sticky

Dulce de leche fills an aisle at every supermarket. Even the smallest corner shop will carry a dozen varieties. We don't have a jar in our kitchen which, no doubt, marks us as foreigners. A Montevideo native says, "As a kid I thought all the world had dulce de leche, and that all the world eated it as much as we do."[see from Uruguay]

Dulce de leche is becoming more popular in the US. The current Wikipedia page is illustrated with a photo of Smucker's brand dulce de leche. I tried dulce de leche m&ms in Kalamazoo. (Very good, but I don't think they caught on.) I don't think the US will ever match Uruguay's love for it.

Labels: customs, food and drink, Uruguay

Banks in Montevideo are open weekdays from 1pm to 5pm. The photo shows people waiting to do business at 1:00 this afternoon. The US used to have very limited bankers's hours as well-- from 10:00am- 3:00pm, if memory serves. The tradition of short banking hours goes back to the era of hand calculations. The banks needed time to manually add up their accounts and to balance their books. Modern banking is all electronic, so calculations are done in real time. That's true here as well. This bank is fully-outfitted with computers, ATMs, online banking, etc. Yet, it and its competitors are only open a few hours a day. I don't know if it's merely customary or some kind of government regulation. As a customer, it's not particularly convenient.

Labels: economics, Uruguay

The World Economic Forum ranked Uruguay 73rd (out of 125 countries) in their 2006 Global Competitiveness Report, released today. For comparison: Mexico ranked 58, Argentina 69, the Dominican Republic 83, and Venezuela 88. Uruguay was 70th in last year's report.

Chile, 27th, is the highest ranked Latin American country. They said:

Chile’s position reflects not only solid institutions – already operating at levels of transparency and openness above those of the EU on average – but also the presence of efficient markets that are relatively free of distortions. The state has played a supportive role in the creation of a credible, stable regulatory regime. Extremely competent macroeconomic management has been a critical element in creating the conditions for rapid growth and sustained efforts to reduce poverty. The resources generated by Chile’s virtuous fiscal policy have gone to finance investment in infrastructure and, increasingly, education and public health. Given Chile’s strong competitive position, the authorities will have to focus attention on upgrading the capacity of the labour force with a view to rapidly narrowing the skills gap with respect to Finland, Ireland and New Zealand, the relevant comparator group for Chile.

The text of the report doesn't discuss Uruguay. There is a substantial discussion of "Argentina's unfulfilled potential" (Box 6) that characterizes Argentina's growth performance as one of high volatility, sharp oscillation, with a clear pattern of boom and bust. The whiplash of its larger neighbor has had major economic effects on Uruguay.

Uruguay had a relatively high rank on Institutions (42) (this category includes property rights, security, ethics, government), and on Education and Infrastructure measures (55-59). Uruguay scored relatively poorly on Macroeconomics (109) and on Market Efficiency (116)(a category that includes subsidies, degree of competition, and trade barriers.)

Other Latin American countries scored substantially lower.

A lack of sound and credible institutions remains a significant stumbling block in many Latin American countries. Bolivia (97), Ecuador (90), Guyana (111), Honduras (93), Nicaragua (95) and Paraguay (106) achieve low rankings overall and, in particular, are among the worst performers for basic elements of good governance, including reasonably transparent and open institutions. These countries all suffer from poorly defined property rights, undue influence, inefficient government operations, as well as unstable business environments. Perceived favouritism in government decision-making, an insufficiently independent judiciary, and security costs associated with high levels of crime and corruption make it difficult for the business community to compete effectively.

Global Competitiveness Report 2006-2007

Labels: economics, Uruguay

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The grasera is a kind of grease trap. It's under a panel beneath the kitchen sink. Today was its monthly cleaning. A worker from a sanitaria service, arrived with his equipment and went right to work. Apparently the grasera catches any grease that goes down the drain with the dishwater and keeps it out of the pipes. I don't know why it's needed. I don't think these are used in US plumbing; I never had anyone come to an apartment to clean a grease trap. Anyway, it only took a few minutes.

Labels: apartments, Uruguay

Nexium is probably best known for its purposively uninformative advertisements. The ads weren't misleading, but the only information in them was the color of the pill (purple). They didn't say anything about what the medication could do or what symptons it could treat, just "ask your doctor..." (See this story on marketing Nexium.) (Another article discusses their broader marketing strategy.)
I take these pills for acid reflux.

In the US, it's a prescription medicine and I was afraid I'd have trouble refilling it in Urugay. No problem; it's an over-the-counter drug here, so I was easily able to buy it. And it was much cheaper here than in the US. A month's supply of Nexium costs about $50 here compared to $200 in Michigan.

A 400% price difference is enough to interest an economist.

Cost differences between Uruguay and the US can't explain the difference because Nexium is produced by AstraZeneca, a Swedish multinational pharmaceutical firm with headquarters in London. Their principal manufacturing facilities are in rich industrialized countries-- Western Europe, USA, Japan, Australia-- with roughly comparable costs.

The price differential must come from differences on the demand side of the market. The US is richer than Uruguay, and its consumers have a higher ability to pay. Charging a higher price in the US and a lower price in Uruguay gives the firm higher profits than charging the same price in both countries. This practice is known as price discrimination. Price discrimination only works if a firm has monopoly power, which AstraZeneca has through its international patents. The other factor needed for successful price discrimination is the ability to prevent re-selling between separate market segments. This is why the pharmacuetical industry fights so hard against drug imports.

Another relevant economic concept is the principal-agent problem. When someone else pays the bills, the decision-maker is less likely to be sensitive to price. In the US, my physician prescribed Nexium, because he believed it would be effective. (And it was.) But, of course, the doctor didn't have to pay for the medication. (First principal-agent problem.) Because I have health insurance that covers a substantial part of my prescription medication, I also don't pay the full cost. (Second principal-agent problem.) If had to pay the full $200 cost for Nexium in the US, I'd probably ask my doctor if Prilosec, or another inexpensive substitute, would work for me. Because of the insurance, I pay less for the expensive Nexium in the US than I pay for the much cheaper Nexium in Uruguay.

Labels: economics, Uruguay

Uruguay news and views: Excellent Uruguay travelog My blog got a nice review from Uruguay News and Views

Labels: Uruguay

The Río de la Plata, or River Plate, doesn't look like a river to me. It has sea lions (see this post), tides (see this tide table for Montevideo) and it must be 100 miles across at this point. It's really an estuary where the Atlantic Ocean meets the waters of the Uruguay and Parana Rivers. The estuary is a mix of salt and fresh waters. NASA shows an interesting satellite photo of this.

The estuary runs northeast from the ocean (see this map) so Montevideo on the north shore is south of Buenos Aires on the south shore. This gives Uruguay the southernmost capitol in South America. (Of course the southernmost parts of Chile and Argentina are well over 1000 miles south of here.)

This photo of clouds throwing shadows on the Rio is from our flight here. I posted another photo of the Rio from our balcony earlier.

Labels: Montevideo places, Uruguay, waterfront

Apparently sour cream doesn't exist in Uruguay anymore. We're making chicken paprika tonight so we went to the big Tienda Inglesa to buy the ingredients. No problem with the chicken or paprika or any of the dumpling ingredients, but we couldn't find the sour cream. The clerk at the grocery told us they used to make it, but apparently there wasn't a market for it. He suggested making our own with heavy cream and yogurt. We'll see how that works.

Labels: food and drink, Uruguay

At first glance, this looks like a typical day on the Rambla outside our apartment. On a closer look the clothes aren't quite right, at least for this time of year. People are wearing shorts and bikinis on the beach, but they're back in jeans and sweaters by the time they reach the sidewalk. An even closer look, shows the movie camera filming the scene. Take after take after take, the same people walked past the same guys holding surfboards and the same bus pulled away from the curb-- only to back down the street a few moments later.

A stiltwalker appeared, towering above the actors. I thought he was part of the show, but it turned out he was just advertising a credit card. He moved down the block to act in the larger scene of everyday life in Montevideo.

Labels: Montevideo places, Uruguay

Thomas Friedman, author of The World is Flat, recently visited Montevideo and wrote about it in the New York Times today (subscribers only section).

A tiny country of three million people, wedged between Brazil and Argentina, Uruguay has come from nowhere to partner with India’s biggest technology company, Tata Consultancy Services, to create in just four years one of the largest outsourcing operations in Latin America.
Yes, when Tata’s Indian employees in Mumbai are asleep, its 650 Uruguayan engineers and programmers now pick up the work and help run the computers and backroom operations for the likes of American Express, Procter & Gamble and some major U.S. banks — all from Montevideo.
How did this happen? One of the most interesting features of this era of globalization is how any entrepreneur — with the right imagination, Internet bandwidth and a small amount of capital — can assemble a global company by matching workers and customers from anywhere to do anything for anyone. Maybe the most important rule in today’s increasingly flat world is this: Whatever can be done, will be done — because so many people now have access to the tools of innovation and connectivity.

Labels: economics, Uruguay

Many familiar brand names are available in Uruguay. Coke and Sprite are the most popular refrescos; Doritos and Lay's potato chips are prominent snacks; and Hellmann's is the leading ketchup.

Ketchup? In the US, Hellmann's is synonymous with mayonnaise. (See www.mayo.com, for instance.) I'd never even heard of Hellman's ketchup before arriving here. Every restaurant seems to serve it and it's the dominant brand at grocery stores. The only place I've seen Heinz ketchup in Uruguay was at the US trade exhibit at the Expo.

Hellmann's ketchup nicely illustrates the global economy. Hellmann's is a well-known US brand, started by a German immigrant in New York City in 1905 . The ketchup sold here in Uruguay is produced in Argentina. Unilever, the Anglo-Dutch food and soap giant, owns Hellmann's and markets its products worldwide. Multinational ketchup!

Labels: business, economics, food and drink, Uruguay

Uruguay’s currency is the peso. Today a US dollar buys just over 23 pesos. When we were here 8 years ago, a dollar only bought 10 pesos. The rapid depreciation of Uruguay’s peso occurred during 2002, as part of a larger economic crisis. Prices, for visitors, are much cheaper now, but the national economy has not fully recovered.

There is some dollarization here, but most everyday items are in pesos. The rent on our apartment is quoted in US dollars, but the gastos comunes (similar to condominium fees) are in pesos. Expensive items like a computer printer will be priced in US dollars but ink refills for the printer are priced in pesos. ATM withdrawals can be made in dollars or in pesos. Sometimes this gets confusing, particularly since the $ is used to indicate pesos, while the dollar is noted by U$S.

Currency fluctuations can cause substantial differences in prices across countries. This leads to some complications when looking at income statistics. Uruguay’s per capita national income is $3,900 US dollars at the current exchange rate. (Roughly 1/10 the US per capita GDP.) When price differences are taken into consideration, Uruguay’s per capita income is $9600 (purchasing power parity) which is significantly higher.

Labels: economics, Uruguay

Well, ants aren't really our friends, but I like the sound of hormiga and amigo together. We have the tiniest little ants in our apartment. Not many, but a few in the upstairs bathroom and now some in the kitchen. They are way smaller than a sesame seed, maybe about half the size of a poppy seed. I think I ate some on a croissant without realizing it.

The photo shows an ant on the rim of a coffee mug. Without magnification, they are just moving black dots. I'm trying to convince my wife that the ants are our pets. She doesn't agree. We asked about ant traps at a local hardware store but they only carried poison granules and they didn't recommend using it near toothbrushes or food. For now, we're storing our croissants in plastic containers.

Labels: nature, Uruguay

The fishing boats were working very close to the beach this morning-- within easy swimming distance. They use nets made of monofilament line. I'm not sure what they're trying to catch.

Yesterday evening we saw fish jumping out of the water: a silver flash, then a splash. A golden retriever swam after them but kept getting distracted as one fish after another jumped. The dog would charge ahead, then hesitate and change direction, again and again. It never caught anything, but it seemed to be having fun.

Labels: Uruguay, waterfront

Today is the last day of the Expo Prado. We enjoyed it enough that we visited again. We had a very nice lunch at the Hereford parilla restaurant. Several of the restaurants are white table cloth establishments with china plates, wine glasses, etc. Much nicer than anything I've seen at a U.S. fair.

The exhibit building from China featured a $20,000 (US) toilet/sink/bidet set. I'm sorry I didn't get a photo. Otherwise it had the same kinds of booths selling various products that many of the other countries had. The newspaper complained that the Chinese exhibits were all in English, with no Spanish.

The US exhibition did offer more than Pringles yesterday. A Country and Western band was singing. The cowboy hats and boots were Texas-style; the singers were drinking mate on break, so I'd guess they were local to Uruguay.

Labels: rural, Uruguay

Since Spring is arriving rapidly (I saw the first ice cream vendor on the beach today) I thought I'd write about heating before it's completely out of mind.

Our apartment, like many of the others we looked at, has losa heating. I don't think any of them had the forced air heating we had in Michigan. A few apartments had radiators and some only had electric space heaters. I'm not sure the space heaters would be very warm when the temperature was in the 30s.

Losa is radiant slab heating, where hot water is run through a concrete slab under the flooring. I wasn't familiar with it at all. It is very pleasant, on a cold morning, to put bare feet on warm tile. My daughter says it would be great for a cat-- curled up on the warm floor. I don't know much about it, but apparently it's gaining popularity in the US, particularly for alternative energy sources (solar, firewood, or geothermal.) I can't say anything about its efficiency, but it has been comfortable.

Labels: apartments, Uruguay

As the weather has warmed in the last few weeks, we've seen more and more people on the beach and in the water. Dozens of sail boats have joined the small fishing boats off Pocitos beach. The Rio de la Plata seems like awfully big water for windsurfers-- certainly not a place for beginners. We do see windsurfers fairly regularly, usually accompanied by a motor boat.

Labels: sports, Uruguay, waterfront

Greg Mankiw points to a recent report from the World Bank, Doing Business.

Uruguay ranked 64th out of 175 countries in the ease of doing business. A few comparative rankings: Mexico 43rd, Dominican Republic 117th, Argentina 101st, Venezuela 164th. The top three countries were Singapore, New Zealand, and the United States. The bottom three Guinea-Bissau, East Timor, and the Democratic Republic of the Congo.


Here's an excerpt from the report on Uruguay

Uruguay
Region: Latin America & Caribbean
Income category: Upper middle income
Population: 3,463,197
GNI per capita (US$): 4,360.00


Ease of... 2006 rank
Doing Business 64
Starting a Business 134
Dealing with Licenses 56
Employing Workers 58
Registering Property 138
Getting Credit 33
Protecting Investors 83
Paying Taxes 76
Trading Across Borders 59
Enforcing Contracts 119
Closing a Business 37

The data behind the rankings are interesting. It takes, on average, 43 days to start a business in Uruguay. The tax rate on gross profits is 27.6%. The cost of firing a worker is 31 weeks of wages. (Comparable figures for the US are 5 days, 46%, and 0 weeks of wages.) An interesting aside on taxes-- 9 countries, including Argentina, are reported to tax profits at over 100%.

Labels: economics, government, Uruguay

There was a young sea lion on the beach outside our apartment yesterday. Animal control officers were trying to catch it, or maybe chase it back to sea. When they got close to it, it would swim a few hundred feet down the beach. That went on for quite a while. The sea lion was still there a few hours later, but the animal control people were gone.

I'm pretty sure it was a South American Sea Lion. In Spanish they're called el leon marino or el lobo marino.

Labels: nature, Uruguay, waterfront

El Horno is the other method of barbecuing in Uruguay. (La parrilla is discussed in an earlier post.) In el horno(the oven) the heat is indirect. A fire on one side of the floor heats the interior of the heavy clay oven. The meat cooks beside the fire on a rack, with a drip tray underneath. An iron door slides up to provide access to the food and fire.

Our friend Tito's horno stands alongside his parrilla and shares its chimney. He cooks with wood, as do the parrillas at the puerto. The food is delicious.

Labels: food and drink, Uruguay

The Expo Prado is an annual event run by the Rural Association of Uruguay. 2006 is the 101st exposition. It's like a State Fair: competitions, animal shows, food stands, and lots of people. Various businesses, government ministries, and foreign countries have exhibits in buildings around the fairgrounds. The US exhibit features M&Ms and Pringles. It certainly isn't among the most impressive. We only visited a few of the exhibit halls because of the crowds. The newspaper said 140,000 people had visited the exposition in its first four days.







The gauchos (Uruguayan cowboys) were impressive. We watched an event similar to a roping contest at a Western rodeo, except without a lasso. Two gauchos on horseback raced after a running cow, riding close enough to control it and turn it without using ropes. They basically made a sandwich-- two horses with a cow inside-- all at a gallop. Very skillful riding. The gauchos dress distinctively, with high boots and either a beret or a wide-brimmed hat. The heels on the boots are lower than a US cowboy and the hat is more straightforward.




Alongside the exhibits are food stands, just like at the county fair. You could buy hot dogs and cotton candy, but also the excellent local barbecue, hot croissants, and a variety of sweets. Stands also offered agua caliente, hot water, for the mate drinkers to refill their thermoses. Since nearly everyone was sharing a gourd of mate, those were popular vendors.

Labels: rural, Uruguay

Uruguay has something of a reputation for classic cars. For years, vintage cars were used as everyday transportation. Most cars today are modern small cars-- Fiats, Citroens, Peugeots, Fords, Kias, Subarus, Hyundais, etc. The original VW beetle is fairly common. Many of the models aren't sold in the US-- subcompacts like the Cheverolet Corsa or Ford Ka. The police cars are small. The taxis are small. There are a few SUVs, but I would see more SUVs parked at the gym in Michigan than I see a in week here. A Honda Accord looks like a big luxury car compared to the typical cars on the road.

There still are some older cars on the street. Some are fully restored and advertise businesses. Some are in private collections. Others are just regular cars. I've seen several big US cars from the 1950s modified with roof racks so they can haul large items. Some of the most impressive vehicles are the old trucks used for the farmers' markets. Some look like they've been in use since WWII.


If you're interested, here's an album of my Montevideo car photos. These earlier posts are related: older car photos, some articles on antique cars in Uruguay

Labels: cars, Uruguay

The port of Buceo is a small harbor just east of our neighborhood. It's full of sailboats and small fishing boats. The Puerto de Montevideo, downtown, serves big cargo ships and naval vessels. These boats are all much smaller. People fish from the breakwaters and others sit drinking mate and chatting. There's a small fish market nearby.

Labels: Montevideo places, Uruguay, waterfront

Milk packaging in Uruguay is very different from what we're used to in the U.S. Instead of bottles or cartons, milk comes in a plastic baggie. This works fine in the store, but once the bag is opened, you need a different system. So, you need to buy a little pitcher that holds the bag and allows you to store it in the fridge and lets you pour it. The system works well, once you have both components.

Sizes are smaller too. Instead of the gallon we'd typically buy in Michigan, the bag holds a liter.

Labels: food and drink, Uruguay

There are wonderful bakeries in Montevideo. Panaderias specialize in breads, sweet rolls, and savory tarts. Confiterias specialize in pastries. Both have medialunas-- croissants. The photo shows a few sweets from our corner confiteria. I think there's one left now. We tend toward more chocolate and less dulce de leche than the local tastes, but all of it is good.

Labels: food and drink, Uruguay

Sunday, we went to the Feria de Trisan Narvaja. It´s a big street market centered on a street named Tristan Narvaja. The streets are closed to traffic and filled with stalls and customers. It´s a mix of farmers´ market and flea market-- vegetables, new clothes, homemade pasta, old books, antiques, car parts, computer parts, used CDs, pets, and lots of other stuff. Some is good quality, other stuff looks like junk. There are hundreds of vendors and crowds of shoppers for block after block after block.

My daughter found a bean bag chair that she wanted. A vendor had a whole stack of new ones-- all empty. The price seemed good, so we bought it and also received the address where we could buy the filling: 3 kilos of chopped foam and one kilo of foam pellets. Tito took me to that store on Monday; 4 kilos of foam turns out to be 4 big bags. We stuffed the chair that night; it was quite a project. The beanbag chair is almost as big as she is. I think we have most of the escaped pieces of foam cleaned up, after 2 days.

Our only other purchase was 10 pesos (about 40 cents) of spices: two little bags of cumin and paprika. Susan has been looking, without success, for cilantro to cook black beans. We may need to grow our own on the terrace.

Labels: Montevideo places, Uruguay

While the trip here didn´t cause jet lag, I seem to be experiencing something similar but on a different scale-- a disconnect between the weather and the calendar. It´s late Winter here in Montevideo. It´s not terribly cold-- usually in the 40s-- although it can be windy along the waterfront. A windbreaker, a warm hat and a fleece are plenty.

It feels like the end of Winter; there are even some early leaf buds appearing on certain trees. (Although not the Sycamores, or Plane trees, that line many neighborhood streets. I´m sure they´ll be late. In Michigan our Sycamore is always last to leaf out.) Night comes early, very much like Winter in the north.

Anyway, it´s not particularly harsh and it feels like warmer weather is coming, and I have no problem accepting that. What seems inappropriate are the dates. When I´m reminded that it´s the end of August or early September, it feels wrong.

I don´t know if there´s a term for this North to South displacement.

Labels: nature, seasons, travel US to Uruguay, Uruguay

Montevideo, like Buenos Aires, is on the Rio de la Plata, or River of Silver. The Rio de la Plata isn´t really a river in the traditional sense. It hasn´t been silver either. In the two weeks we have been here, the Rio has been brown, blue, and green-- depending on the weather. This morning it really was silver.

Labels: Montevideo places, Uruguay, waterfront

We moved to our new apartment. This is the view of Pocitos bay from our terrace. It's a nice apartment -- modern kitchen, two floors-- in a good location. It's roomy and well-lit. After all our looking, we found a good place.

There are lots of little restaurants and cafes in the neighborhood. Some cyber-cafes as well. Our Internet service is scheduled to start next week, so my blog entries may be a bit sporadic until then.

Labels: Montevideo places, Uruguay, waterfront