Uruguay’s economy is expected to experience a strong rebound in 2024, with growth projected at 3.7%. This increase will be driven by the surge in agricultural exports and balanced macroeconomic risks. The International Monetary Fund (IMF) also anticipates an increase in cellulose production by UPM and a recovery of real wages, with a further 2.9% improvement expected for 2025.
Despite facing a historic drought in 2022 and 2023 that severely impacted agricultural production, Uruguay has seen an easing of financial conditions and robust private consumption due to updates in salaries and a reduction in the price gap of products compared to neighboring Argentina. The IMF acknowledges the significant losses caused by the drought in the agricultural sector during October 2022 and April 2023.
Inflation is expected to increase in the second semester of 2024 alongside a gradual easing of rates by the Central Bank (BCU) and wage growth. However, these changes are not expected to exceed the government’s target. The IMF emphasizes the importance of continued vigilance of monetary policy to maintain credibility and support de-dollarization efforts.
As President Luis Lacalle Pou approaches his last year in office, Uruguay is currently facing various scandals as politicians compete to succeed him. Despite these challenges, the country remains committed to its economic growth and development goals.
