Uruguayan free zones “play an important role in attracting investment, generating qualified employment and diversifying exports.” The Uruguay XXI Institute released a report highlighting the relevance of these customs exclaves. These facilities are used as logistics centers, acting as an intermediate destination for grain exports or certain pharmaceutical products and also function as industrial processing locations, as in the case of pulp production (UPM and Montes del Plata) and concentrate. of beverages (PepsiCo, in Cologne).
Uruguay’s exports of goods, including free zones, showed a strong rebound in 2021, reaching record levelsyes Foreign sales totaled US$11,373 million in 2021 and grew 42% in year-on-year terms. ANDThis increase was largely due to the high levels of international prices for many of the main goods exported by Uruguay, such as meat, soybeans and cellulose. of this wholealmost 26% is exported from free zones, either because it is produced or because the free zone is used as an intermediate destination.
In the first six months of 2022 exports continued to grow and they stood at US$ 6,838 million, 37% above the record for the same period a year ago. Sales from free zones represented 29% of that total, with US$ 1,977 million (44% above what was exported in the first half of 2021), according to Uruguay XXI.
Uruguay XXI
some figures
The Nueva Palmira and Colonia free zones were created prior to the 1988 Free Zone Law, closely linked to the port of the department of Colonia. Currently, Uruguay has 12 free zones in operation: Nueva Palmira (state), Fray Bentos (UPM), Cuecar SA (UPM 2 in Paso de los Toros), Libertad, Punta Pereira (Montes del Plata), Colonia, Colonia Suiza, Floridasur, Zonamerica, WTC Free Zone, Parque de Sciences and Aguada Park.
Uruguay XXI
According to the latest data published by the MEF, the personnel employed in free zones stood at 15,235 in 2019. In the free zones are located 1,074 companies, which mostly carry out global trade and service activities. 67% of companies in free zones are exporters.
Also, investment from free zones exceeded US$400 million in 2019, occupying 5.6% of the total investment of the economy in that year. The Gross value added generated in free zones stood at 4.86% of GDP in 2019remaining close to 5% of GDP since 2017.
Two projects underway
In June 2021, the installation of a service free zone in Punta del Este was approved: World Trade Center Punta del Este. The new free zone represents an investment of between US$ 35 million and US$ 40 million and will try to attract companies from all over the world to settle in one of the most outstanding tourist and convention destinations on the Uruguayan coast.
The area is located in a 25-story tower located on the main avenue of the city (Gorlero Avenue and 23 El Corral Street). Last June, work began on the construction of an office tower that will occupy more than 28,000 square meters. Its construction will generate more than 200 direct jobs during a period of 32 months.
It is expected that this free zone employs more than 1,000 people and that has a varied offer with companies linked to technological, financial and commercial sectors, as well as professionals who work providing services to other countries
Secondly, the MEF analyzes a project for the installation of a service free zone to be built in Real de San Carlos, in Colonia del Sacramento. The project called Zona Franca del Plata was approved by the Departmental Board of the department of Colonia and consists of a five-story building which will offer national and international user companies first-class infrastructure and a protective legal framework from which to export their global services. The building will be sustainable, built with the latest wood technology to meet the highest international standards.
The estimated investment to carry out the project is US$ 19 million. The free zone would have 9,300 m2 of office space for lease. The facility is expected to house around 110 companies and generate nearly 1,000 jobs. Once the authorization of the Government is granted, Zona Franca del Plata will be operational by the end of 2024. Although the project does not yet have the approval of the executive branch, it is in the final phase of the approval process, according to the official report.
