MercoPress. South Atlantic News Agency

Uruguay's Defense Ministry takes disciplinary measures in Cardama deal probe

Jorge Wilson was imposed a 30-day arrest for his conduct in the investigation regarding the fudgy Cardama deal

Senior Uruguayan Navy officers, including former Commander-in-Chief Jorge Wilson, were handed down arrest sanctions for their roles in purchasing two ocean patrol vessels (OPVs) from Spain's Cardama shipyard, a company with no experience in that type of unit, and was also facing financial hardships.

The € 82 million contract, signed in 2023 under the previous government, is under scrutiny by the current Frente Amplio administration due to questionable payments and insufficient evidence of progress.

An administrative investigation is recommended to review the procurement process, which began in 2021 and favored Cardama despite warnings from Navy officials like Gustavo Musso about the shipyard’s inexperience and risks.

Cardama’s financial instability, including a failed loan attempt and questionable cash guarantees, raises concerns about potential contract failure, which could cost Uruguay US$ 92 million and leave it without needed vessels.

The government of President Yamandú Orsi is evaluating further actions while the contract’s execution limits options to cancel it.

Wilson was imposed a 30-day arrest. He allegedly provided information on a second € 8.2 million payment to Cardama approved in February under the previous government, but which the current one -in office since March 1- questions its justification.

Rear Admiral Jose Ruiz and Captain Marcelo Da Silva were also sanctioned for omissions or delays in providing data to the “working group” created by current Defense Minister Sandra Lazo to investigate the case.

This group, headed by Alfredo Maeso, concluded that an administrative investigation was required to review the procurement process initiated under then-Defense Minister Javier García.

The contract with Cardama, for € 82 million, included two payments already made. The current Frente Amplio government argues that there is insufficient evidence that the shipyard met the agreed milestones. A pre-Easter meeting with Cardama executives did not resolve doubts about progress. Despite assurances from Mario Cardama and Lloyd's Register certification, doubts persist, and a third payment is contingent on the keel-laying of the first vessel in May.

The Uruguayan government remains skeptical, given Cardama's track record of failed projects and financial restructurings. Lazo herself had been monitoring the process back then from her Senate seat and had repeatedly spoken against Cardama. “Transparency and follow-up commissions were presented, which fell by the wayside because many times the press had more information than what was given in those areas, which were announced with great fanfare,” Lazo pointed out back then. “Let's reshuffle and deal again,” she added, despite admitting that the OPVs were needed.

In 2024, Admiral Gustavo Musso requested to leave active service, citing concerns over Cardama's choice. He had recommended other shipyards, including Godan, Cotecmar, and Kership. In addition, the case brought up an incident with China's Shipbuilding Trade (CTSC), which had participated in the bidding but claimed unclear specifications and changing budgets. Former President José Mujica highlighted the impact of such sloppy proceedings vis-à-vis the Chinese, who were owed -he claimed- at least an apology.

This week's sanctions are not precluding further disciplinary action against the Navy's brass for the fudgy deed. The contract, already in execution, limits the legal options to revert it, according to analysts.