MercoPress. South Atlantic News Agency

Kiwi forestry giant approved for Uruguayan benefits program

Claymark Uruguay will make a US$103.5 million investment


New Zealand forestry giant Claymark has received official approval for a major investment in Uruguay, committing over US$100 million to establish large-scale operations in the South American nation.

Uruguay’s Commission for the Application of the Investment Law (Comap) formally declared the project “promoted,” granting the company's subsidiary, Claymark Uruguay, a series of associated tax exemptions.

The investment, officially valued at approximately US$103.5 million, is intended to fund the acquisition of essential machinery, equipment, and fixed installations required for the development of its activities.

Claymark — the largest manufacturer and exporter of premium pine products in New Zealand — justified its request for incentives by committing to job creation, increased exports, and the implementation of Clean Technology in its production processes.

The investment promotion status grants Claymark a total exemption from taxes and duties on the importation of fixed asset goods and materials for civil works, an exemption from Value Added Tax (VAT) on these imports, VAT tax credit for eligible purchases of materials and services made in the local Uruguayan market, and a near-total exemption from the Corporate Income Tax (IRAE).

Claymark, now owned by NZ Future Forest Products, specializes in the production of high-quality pine products for demanding international markets. The company, which operates seven production sites and employs over 600 people in New Zealand, is known for its emphasis on innovation, quality standards, and sustainability.

By leveraging European technology for its advanced sawmilling and wood remanufacturing operations, Claymark aims to consolidate its reputation in Uruguay. The move is viewed as a significant boost to Uruguay's forestry sector, leveraging the country's supportive legislation to attract large foreign capital investments.

Uruguay actively encourages foreign and domestic investment through its comprehensive Investment Law (Law 16.906), administered and applied by the COMAP, to provide stability and flexibility to investors by offering a wide array of tax incentives, provided the projects meet specific national strategic objectives.

The law applies equally to local and foreign investors, ensuring fair treatment regardless of the origin of the capital. Companies voluntarily submit their investment projects to COMAP for evaluation and promotion status. The main benefit is the exemption from the Corporate Income Tax (IRAE), as per a series of indicators that the company pledges to meet. The amount and duration of the exemption are tied directly to the project's score based on its commitment to national priorities.