MercoPress. South Atlantic News Agency

Uruguay cancels OPV shipbuilding deal

There are “strong indications that we are facing a swindle or fraud against the Uruguayan State,” Orsi argued

Uruguayan President Yamandú Orsi announced his government's decision to terminate the contract with Spain's Cardama Shipyard for the construction of two Ocean Patrol Vessels (OPVs). The contract, signed under the previous administration of Luis Lacalle Pou (2019-2025), is being rescinded due to years of delays, non-compliance, and the shipyard's precarious financial situation, it was explained.

Orsi described the case as having “strong indications that we are facing a swindle or fraud against the Uruguayan State,” citing serious breaches of contract, including null collaterals, the shipyard's lack of technical capacity, and the unjustified delays in construction, which is estimated to be only 15% complete.

The government plans to execute the 5% contract guarantee (approximately 4.1 million euros), pursue administrative, civil, and criminal legal action, and seek to recover the approximately US$30 million already transferred to the company. Two Navy officers are traveling to Spain to verify the minimal progress.

The process began in 2020-2021. An initial 2022 tender for two OPVs was declared void in January 2023 due to high prices, despite the technical commission recommending a Chinese option (CSTC) for US$161.48 million. Pressure from the United States reportedly discouraged the Chinese option.

Cardama, a century-old Vigo-based shipyard with no military vessel experience, informally entered the process in April 2023. Its offer was quickly approved despite initial technical commissions being marginalized. The contract for 84 million euros for two OPVs was signed in December 2023.

The shipyard has been described as a “paper company” with only one employee in 2023-2024, a Russian director in Russia, and false references on its website.

In October 2024, a guarantee by Eurocommerce was accepted. However, the UK-based company was later described as non-existent at its listed address, inactive since 2023, and in liquidation. Uruguay's Defense Ministry reportedly ignored the recommendations from the Central Bank of Uruguay (BCU).

In April 2024, four Navy high-ranking officers were sanctioned for irregularities. An internal July 2025 report confirmed non-compliance, lack of capacity, and significant delays.

Orsi's ruling Broad Front (Frente Amplio - FA) is accusing the previous administration of negligence or corruption, claiming “red flags” were ignored.

The scandal has generated parliamentary debate and may lead to new, transparent tenders, although it has delayed naval modernization. The judiciary will investigate whether there was malicious intent.

National Party Senator Javier García, who was Uruguay's Defense Minister at the time of the Cardama contract, posted the following message on X on Wednesday: “It's regrettable that President Orsi has lent himself to such a political maneuver of the worst kind. He knows the ships are being built too late, and he's going to leave the country without the ability to protect our sea. With this move, he exposes the Uruguayan government to lawsuits and violates our country's seriousness in fulfilling a contract. Petty politics unfortunately won out for the president. If he wants to discuss the guarantees the company presented, he can do so, but he acknowledges in the press conference that they are being built and exposes Uruguay to being left without ships for petty politics. They never wanted the patrols for political reasons.”