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Two concerns dominated Uruguay's foreign economic relations during the 1980s. The first, both a fiscal and an external problem, was the foreign debt. Uruguay's external debt of about US$6.7 billion (US$6.2 of this was foreign debt to the United States) in 1989 (US$4.2 billion belonging to the public sector) was not an issue affecting international financial markets, like the much larger debt burdens of Brazil or Mexico (each over US$100 billion). Even so, Uruguay's indebtedness was onerous in comparison with the size of its economy and was one of the highest per capita debts in the region. For both the Sanguinetti and the Lacalle governments, debt reduction and debt rescheduling were priorities.
The second major concern was trade, primarily for its importance to overall economic growth. Trade-related activities were responsible for about 12 percent of GDP in 1988. Exports, which were the source of Uruguay's wealth in the early twentiethcentury, were seen as the key to the revival of the economy. Demand within Uruguay was simply too small to support large production increases. Trade was especially important in the 1980s because of the debt burden. In order to make payments on mostly dollar-denominated loans, Uruguay needed foreign exchange (dollars). Thus, the trade balance (the difference in value between exports and imports) took on added significance. To spur economic growth and to earn foreign exchange, Uruguay joined other Latin American nations in restraining imports and augmenting exports. Despite its positive trade balance, however, Uruguay's foreign debt continued to increase.
Data as of December 1990
Note that current information from the CIA World Factbook, U.S. Department of State Background Notes, Australia's Department of Foreign Affairs and Trade Country Briefs, the UK's Foreign and Commonwealth Office's Country Profiles, and the World Bank can be found on Factba.se.
Editor's Note: Country Studies included here were published between 1988 and 1998. The Country study for Uruguay was first published in 1990. Where available, the data has been updated through 2008. The date at the bottom of each section will indicate the time period of the data. Information on some countries may no longer be up to date. See the "Research Completed" date at the beginning of each study on the Title Page or the "Data as of" date at the end of each section of text. This information is included due to its comprehensiveness and for historical purposes.
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Section 110 of 167
($U) Uruguayan New Peso (UYU)
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