Uruguay-Free-Trade Zones

The free-trade zones that Lacalle mentioned were already operating in Uruguay during the late 1980s as an important part of the Sanguinetti administration's strategy to encourage both foreign investment and regional trade. Under legislation passed in late 1987, free-trade zones such as the ones in Colonia and Nueva Palmira (in Colonia Department) became attractive sites for investors for several reasons: users were exempted from all Uruguayan taxes, except for social security taxes on Uruguayan workers; all imported goods and services entering the zones were exempt from customs duties or taxes; goods and services reexported from the zones were exempt from taxes; and commercial or government service monopolies were not applicable within the zones, so that no company was forced to deal with the State Insurance Bank, for example. Restrictions on free-trade zones prohibited companies from duplicating existing industries, such as textile manufacturing. Thus, the thrust of the program was to attract innovative companies to Uruguay. As of early 1990, the free-trade zones were attracting a good deal of attention, but it was too soon to tell what impact they would have on the Uruguayan economy.

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A superb and very readable introduction to Latin American economic history, with references to Uruguay, is Celso Furtado's Economic Development of Latin America, which focuses on major themes such as import-substitution industrialization. For a more detailed picture of Uruguay's economic history until the 1970s, the best English-language source is M.H.J. Finch's A Political Economy of Uruguay since 1870. Few English-language books have focused exclusively on Uruguay's more recent economic progress. A good source in Spanish is La Crisis uruguaya y el problema nacional by the Centro de Investigaciones Económicas.

Several references examine individual aspects of Uruguay's economy. Two good articles on the labor movement are Arturo S. Bronstein's "The Evolution of Labour Relations in Uruguay" and Juan Rial Roade's "Uruguay." Larry A. Sjaastad's "Debt, Depression, and Real Rates of Interest in Latin America" explains Uruguay's early involvement in the debt crisis.

Basic economic data on Uruguay are provided in the International Monetary Fund's International Financial Statistics, in the Inter-American Development Bank's Economic and Social Progress in Latin America, published annually, and in the Latin American Regional Reports series of periodicals. Two useful Uruguayan economic periodicals are Guía financiera and Búsqueda. (For further information and complete citations, see Bibliography.)

Data as of December 1990