MercoPress. South Atlantic News Agency

Uruguay foresees economic growth, job creation and tax cuts

If there is a growth higher than projected, there must be a decrease in taxes, Arbeleche explained

Uruguay's Economy Minister Azucena Arbeleche Monday said the Government foresees a 4.8% growth in 2022 and the creation of 40,000 jobs, which would make the lowering taxes feasible.

During a Council of Ministers review of the State's Accounts which are to be put up for Parliamentarian approval no later than Thursday this week, Arbeleche also explained some US$ 370 million will be allocated to the COVID-19 fund.

After the Council's meeting Monday, Arbeleche and her colleagues Pablo da Silveira (Education), Pablo Mieres (Labor), and Luis Alberto Heber (Interior) held a press conference in Montevideo, ahead of the Lower House appearance.

“Today we were reviewing what was the growth of the Uruguayan economy in 2021. The economy grew by 4.4% last year, and that was well above the estimates of analysts and the economic team itself. This growth went hand in hand with the generation of jobs: in 2021 almost all the jobs lost during the pandemic were recovered,” Arbeleche explained.

“In Uruguay, we have activity data, which correspond to the first quarter of this year: they are very positive data. The Uruguayan economy grew in relation to the same quarter of 2021 by more than 8%. If we add to that data the indicators we are seeing, which have to do with exports, industry, slaughtering, crop yields, the economic team feels today with the tranquility to project a new estimate of economic growth of 4.8%,” she added.

“The estimate we have today of economic growth for 2022 is 4.8%, one percentage point above what we estimated in February,” she also pointed out.

“This increased economic activity is going to come again with job creation, which is going to be close to 40,000, according to what we are projecting,” Arbeleche forecasted while assuring that education, security, and a salary recovery will be the administration's priorities.

“The axes of this Accountability have to do with a look to the future, to growth. Last year we allocated resources to a structural weakness, related to early childhood and housing solutions for the neediest. At this moment we are looking ahead, to make Uruguay grow more and Uruguayans be safer,” the minister insisted.

She added that the 2023 budget will seek to “consolidate the educational transformation that the country has been carrying out and now will be strengthened; consolidate the protection of our citizens, from the Ministry of the Interior; and the salary recovery that is beginning to be observed in civil servants.”

Arbeleche also said that once again “resources are made available for these transformations without increasing taxes,'' which ”speaks of a radical change in the country's economic policy: in the past, higher expenditures were financed by tax increases.'

“The president was very clear on March 2 in the General Assembly: if there was a higher growth than projected for this year, there was going to be an improvement in the tax burden and a decrease in taxes. This commitment is still in force,” Arbeleche highlighted.