MercoPress. South Atlantic News Agency

Uruguay hopes China will build and finance a deep-sea port on the Atlantic

Wen Jiabao is scheduled to visit Uruguay this month

Uruguay’s long standing dream of building a deep-water port in the east of the country could become a reality in coming days when China’s Prime Minister Wen Jiabao visits the country, according to the government financed newspaper La Republica.

The newspaper states that Wen Jibao will be Latin America for two major events, the G20 summit in Mexico next week and later for the Rio+20 gathering in Brazil, June 20/22. Some time then the Chinese leader is scheduled to visit Uruguay.

“It’s the first trip to Uruguay of such a high ranked official and all indicates the documents will be signed for the assessment of the project and later construction of the deep-sea port” to the east of the country, close to the Brazilian border says the daily quoting Uruguayan reliable sources. Allegedly China’s development bank would support the financing of the project.

A deep water port for Uruguay on the Atlantic coast is a project with over a century originally planned by then President Jose Batlle y Ordoñez elected twice (1903/1907 and 1911/1915) and considered the great economic and social reformer of the country.

The idea resurfaced half a century ago in the fifties and sixties, given the growing problems of access to the River Plate and disputes with neighbouring Argentina, but lack of financing froze the plan.

The River Plate ports of Montevideo and Buenos Aires need constant dredging in their access canals which makes them costly, and Argentina has always tried to downplay Uruguayan competition in port services.

Currently there is a frustrating dispute with Argentina over the dredging of a second canal (Martin Garcia) which leads directly to the Uruguayan port of Nueva Palmira that has become the main grains, oil seeds, pulp and minerals terminal given its closeness to the main agriculture area of the country.

The River Plate is jointly administered and Argentina has always privileged the Mitre canal which leads directly to Buenos Aires. Since the time of the Spanish colonial empire, Buenos Aires and Montevideo have been involved in what is known as the “ports’ rivalry”. Buenos Aires was capital of the River Plate viceroyalty and Montevideo, with easier access and further east and south, seat of the Spanish naval base with control over all the South Atlantic islands.

According to Uruguayan sources allegedly Brazil could also be interested in a deep waters port next to its border to help with the export of some of its commodities from the rich state of Rio Grande do Sul, although Uruguay’s northern neighbour is already building a major cargo and oil terminal in Rio Grande, from where it plans to control the southern end of all of its hydrocarbons activities.

However it has yet to be seen what Brazil’s reaction could be if finally an out-of-the-region, and none less than China disputing world predominance, ends up constructing and financing a major deep sea port in the South Atlantic, an area to which Brazilian strategists refer as the “blue Amazon” and with direct access to the Parana, Paraguay and Uruguay basin in the heartland of South America.