*The International Monetary Fund (IMF) has stated that Uruguay’s economy is expected “to strongly rebound” in 2024, with a forecast of 3.4% growth this year and 3% in 2025. In an IMF statement released following the IMF Executive Board’s conclusion of an Article IV Consultation with Uruguay, the IMF stated that Uruguay’s economy had “remained resilient”, having faced the impact of “a once-in-a-century severe drought and external headwinds” last year. It attributed this resilience to “the authorities’ sound macroeconomic policies, the country’s political stability, and strong institutions”. As a result, GDP growth slowed to 0.4% in 2023 while unemployment “continued to hover at around 8%”. Despite this, the IMF noted that inflation fell within the target range in mid-2023, reaching its lowest level in the last 18 years, while “the financial sector remained resilient, and the banking system is well capitalised, highly liquid, and profitable”. According to the IMF, economic recovery will be aided this year by “recovery of agricultural exports, increased cellulose production, easing of financial conditions and robust private consumption”. Downside risks for Uruguay’s economy are derived from a worsening of external financial conditions, deterioration of international geopolitical tensions, and the potential for further extreme climate events.
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