OK. Maybe Uruguay is not the “big country” you imagined I would write about, but with an area bigger than that of England and Wales combined, it is no small country. What makes the country big, what makes it punch above its weight (apart from a statistically unusually successful national football team) is its growth. And I don’t mean the nearly 4% forecast for this year but the sustained growth over the years that have earned the country the triple crown of investment rating.
Investors know there is potential in Uruguay. In 2012, investment was at its highest since 1948. Yesterday I had the pleasure to learn more about Montes del Plata, the largest ever private investment in Uruguay. To cut it short: a pulp mill making the most of the country’s natural resources through a Chilean-Swedish-Finnish investment with its very own power station and its very own fluvial port. No less. And I heard it through its CEO, Erwin Kaufman, who delivered a great talk about the whole project.
The new investment will mean that Uruguay’s forestry exports, currently 13% of all exports, will represent 20% of exports. The project employs 700 people with up to 6000 during the construction phase. Suppliers range from hoteliers to dairy farms, from health and safety training to rice producers.
British companies will ask, what’s it in for me? Before we answer, I think there are two big lessons here:
- First of all, you must KNOW about these projects, not just in Uruguay but in all Latin America, to make the most of them. Are you keeping up to date or is someone helping you keep up to date? Would you have thought of opportunities in forestry in Uruguay or oil & gas in Peru, for example? Would you have considered retail in Colombia or franchising in Costa Rica? Investing in generating this intelligence is key.
- Second, doing business with these projects requires local understanding and, more often than not, local presence. When the purchase orders come, when the tenders are issued, that’s too late to move. The market needs to know you already. Businesses that invest in international expansion, that make the move early and that are totally prepared will stand more of a chance of closing a deal. Those that are in the market, through a distributor or a representative, or through their own offices, will have done all the prep work and will be ready to deliver. If you are not ready for this project, will you be ready for the next?
What’s in it for you? It depends on what you are prepared to invest. As we have discussed before, Latin American markets take time and patience. Clearly, some are seeing the rewards…
PS Two developments I am keeping an eye on here in Uruguay for you (how kind!): the deep water port in Rocha and the recently-announced Antel Arena in Montevideo. Want to know more and be kept up to date? Sign up for our newsletter HERE.
Subscribe to our monthly newsletter
- The Flamengo tragedy and safety standards in Latin America
- Taking a corner – Argentina style
- The luxury consumer in Latin America: some thoughts
- Obesity v beauty? Trends in Latin America
- 5 not-so-obvious things to pack for your Latin America business trip
- How slow is “slow” in Latin America?
- Stairlifts, water filters, and baked beans: ExpoPrado 2018 Uruguay photoblog
- Where do I start when selecting my next export market?
- Transparency in Latin America – and why it matters to exporters
- Peace in Latin America – and why it matters to exporters