According to Trading Economics global macro models and analysts, Uruguay’s GDP is anticipated to reach 56.70 USD billion by the end of 2021. According to our econometric models, Uruguay’s GDP will trend at 59.00 USD billion in 2022.
Is Uruguay a poor or wealthy country?
Uruguay stands out in Latin America as an equitable society with a high per capita income, low levels of inequality and poverty, and a near-complete lack of extreme poverty. In terms of size, its middle class is the largest in America, accounting for more than 60% of the population.
Following the crisis in 2002, Uruguay implemented reforms that improved macroeconomic policy practices, reduced economic and financial exposure to neighboring countries, and pushed for the implementation of new social policies, all of which contributed to solid results and, as a result, Uruguay became more resilient.
However, even before the COVID-19 outbreak, inclusive growth metrics had begun to exhibit indications of weariness. GDP growth has slowed from 4.6 percent in 2013 to 0.5 percent in 2018 and 0.4 percent in 2019, the slowest since 2002. Poverty reduction had stalled, even showing signs of incipient increase, after falling from 32.5 percent to 7.9 percent between 2006 and 2017. (8.8 percent in 2019).
The pandemic also revealed the country’s strengths. Based on a national comprehensive online learning platform, Uruguay was one of the most prepared countries in the region to make the shift to remote education. More than 75% of students and 84 percent of teachers were able to stay connected to the platform when schools were closed because to content tailored for teachers, students, and families, as well as widespread access to the Internet and smartphones. Uruguay was the region’s first country to progressively reopen schools.
Similarly, Uruguay’s broad social protection network, strong health system with universal coverage, and comparatively positive levels of labor formality and social welfare put it in a better position than other countries to respond to the pandemic quickly, effectively, and continuously at a lower cost. Furthermore, despite the fact that the country had a heavy wave of infections in the first half of 2021, efficient containment during the early phases of the pandemic allowed for a rapid and extensive reopening of the economy, which helped to mitigate the detrimental consequences of the health shock. More recently, maintaining the current economic reactivation, particularly in the activities most affected by social distancing measures, necessitated a quick and effective vaccination effort.
Uruguay’s strong economic progress, notably since the crisis of 2002, along with the country’s robust social contract, support the route to poverty reduction and the promotion of shared prosperity. The country has made a considerable commitment to issues of social protection. Historically, inclusive social policies have emphasized broadening program coverage. In this regard, the pension system covers over 90% of the people over the age of 65, making it one of the highest rates in Latin America and the Caribbean, with Argentina and Brazil.
There are structural obstacles today that could stymie progress toward long-term development goals. On the one hand, the country is in the midst of a demographic change and is revamping its social security system, which is currently generating significant fiscal expenses. Uruguay, on the other hand, confronts problems in terms of women’s participation in economic activities, as well as the reform of education and labor institutions to take advantage of technology advances and promote infrastructure investment and integration into global value chains. Finally, despite the fact that Uruguay’s poverty rate is low in comparison to the rest of the region, there are major inequities in terms of age, sex, region, and origin, which may have worsened as a result of the epidemic.
Strong institutional performance in other areas, such as government trust, low corruption, a consensus-based political approach, and a strong commitment to strengthening institutional arrangements, provides the country with a solid foundation on which to continue renewing its social contract and developing policies to address current constraints.
Is Uruguay’s economy doing well?
Uruguay’s economic freedom score is 70.0, ranking it 34th in the 2022 Index of Economic Freedom. Uruguay is placed 5th out of 32 countries in the Americas, with a score that is higher than the regional and global averages.
How did Uruguay become so prosperous?
In the context of the Americas, Uruguay has always been a relatively rich country. The country’s economy has been rising due to increasingly trade-focused governments since the dictatorship in the 1970s, fueled primarily by beef, wool, crops, and dairy products. Despite a brief period of economic volatility at the turn of the century, owing to upheaval in Argentina and Brazil, Uruguay has since reverted to a shared wealth system.
Why is Uruguay such a poor country?
Uruguay has been hailed as a success story in terms of economic improvement and poverty reduction in recent years. Poverty in Uruguay has fallen from 32.5 percent to 9.7 percent in the last ten years, according to the World Bank, which has played a significant role in helping the Uruguayan economy during the last decade. Only 0.3 percent of the population is classified as being in the poorest sector, indicating that extreme poverty is practically abolished. Nonetheless, poverty exists in this Latin American country, and the causes of poverty in Uruguay can be divided into three categories: a lack of early childhood education, a fast modernizing rural sector, and economic disparities between men and women.
Women and children make up a big portion of Uruguay’s disadvantaged population. Children under the age of 15 make up a major portion of the poorest population. Furthermore, rural households among the poorest 20% of the population have the most children. The lack of nutrition and education accessible to the children in these families is exacerbated by the negative association between family size and economic position. The Economic Commission for Latin America and the Caribbean conducted research that found severe learning disabilities in children from low-income families.
The development of the rural sector has also played a significant influence in maintaining poverty in Uruguay’s more rural areas. Those employed by rural producers are being thrown out of labor as rural production activity gets streamlined with the advent and availability of new technologies. While modernization continues to benefit Uruguay’s metropolitan areas, the number of rural laborers who have lost their jobs as a result of modernization is on the rise.
Women make up a major share of the workforce in both rural and urban areas of the country. In fact, in all of Latin America, Uruguayan women have the highest labor participation rate. Nonetheless, the income disparity between men and women is substantial, and it is one of the major causes of poverty in Uruguay. With women in Uruguay earning less than 60% of men’s income, it’s no surprise that women are significantly more likely than men to fall into the poorest category. Women also continue to undertake conventional domestic responsibilities, limiting their mobility and time available for paid work. As a result, single-mother homes account for a significant portion of Uruguay’s poverty.
If the roots of poverty in Uruguay are to be addressed in the next years, considerable work remains to be done in the areas of agribusiness reorganization, education, and wage gap between men and women. Uruguay, on the other hand, has made significant progress during the last decade.
The Uruguayan government has been able to adopt a development process a mix of loans, insurance, donations, and information exchange that has yielded excellent results with the help of the World Bank. Uruguay was classified as a high-income country in 2013, having the largest middle class in the Americas, accounting for 60% of the population. Apart from economy, Uruguayans have a high level of trust in their government, which is partly due to low levels of corruption and governmental stability.
In terms of financial independence and high levels of equal opportunity for citizens, Uruguay is a bit of an outlier in Latin America. And, while poverty still exists in Uruguay, the prospects for further reductions in poverty are exceedingly promising as the country continues to expand and prosper as an egalitarian and economically stable nation.
Is Uruguay’s government stable?
Political Stability and the Absence of Terrorism/Violence: Percentile Rank, Upper Bound of 90% According to the World Bank’s collection of development indicators derived from officially recognized sources, Uruguay’s Confidence Interval was reported at 96.7 percent in 2020.
Why is Uruguay so prosperous?
Uruguay is a developing country with a high-income economy that ranks first in Latin America in terms of democracy, peace, corruption perception, and e-government. When it comes to press freedom, the size of the middle class, and prosperity, it leads South America. Uruguay contributes more troops to UN peacekeeping missions than any other country on a per-capita basis. In the Global Terrorism Index, it is the lowest-ranking South American country, while it ranks second on the continent in terms of economic freedom, income equality, per-capita income, and FDI inflows. In terms of the Human Development Index, GDP growth, innovation, and infrastructure, Uruguay is the continent’s third-best country. Uruguay is regarded as one of Latin America’s most socially progressive countries. It scores well on international criteria of personal rights, tolerance, and inclusion, as well as acceptance of the LGBT population. Cannabis, same-sex marriage, and abortion have all been legalized in the country. Uruguay is a founding member of the United Nations, the Organization of American States, and Mercosur.
Is Uruguay a desirable location to live?
Uruguay is regarded as one of the best retirement destinations in the world. Friendly people, nice weather, and an infrastructure that includes reliable Internet access and potable water distinguish the country. It’s also pretty simple to get a residency permit.
In Uruguay, are all drugs legal?
Uruguay has one of the continent’s most advanced drug regimes. The law of Uruguay does not make it illegal to consume or possess narcotics for personal use. Furthermore, in recent years, its national drug policies have placed a greater emphasis on prosecuting medium and large-scale traffickers, rather than focusing resources and efforts on small-time dealers who are readily replaced. The extent of the legislation, the policies developed, and how the normative and policy frameworks manifest themselves in Uruguay’s prison system are examined in this country study, with a special focus on the population detained for drug-related offenses.
