Uruguay lost competitiveness for sixth month running in April with main trade partners

Tuesday, June 5th 2012 - 23:34 UTC

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External competitiveness of Uruguayan goods dropped for the sixth month running in April because locally produced goods’ prices in US dollars dropped less than those of its main trade partners according to figures released by the Central bank. Read full article

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ChrisR
Uruguay is suffering because of the panic monetary measures instigated in Brasil

These measures MAY work, I am not confident that short-term give-aways to auto makers will do anything and making banks give loans to deadbeats is a loser from the get go.

Uruguay is is going the right way and just need to keep its nerve for the next year or two.
Jun 06th, 2012 - 11:49 am - Link - Report abuse 0
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UruguayBR
The effects of decreasing competitiveness are already taking a toll. Data from March is show signs of an economic contraction for the first time in over two years.
http://uruguaybr.wordpress.com/2012/06/06/ceres-sees-first-signs-of-economic-contraction-in-uruguay/
Jun 06th, 2012 - 05:07 pm - Link - Report abuse 0
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ChrisR
2 UruguayBR

It is not only decreasing competitiveness that is the problem.

The fiscal drag on the economy of all the government employees, including ALL the monopolies - ANCAP, ANTEL, OSE, UTE, BSE et al, maybe sustainable in good times but are a double edged sword in the lean times. Falling income from taxes (the ONLY source of goverment money - it is NOT revenue) and the inability to reduce outgoings will result in increasing tax rates to TRY to make up the shortfall.

If only sensible policies to switch this form of labour to the productive sector - with pay-offs if necessary to the people moving jobs and enticements to new business; then it would be so much easier to weather the storm. This can only realistically be attempted in good times without the risk of labour unrest.

For a country of only 4.5 M, there is a great deal of fiscal drag.
Jun 06th, 2012 - 07:01 pm - Link - Report abuse 0
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