The business hub is consolidated in Uruguay

Thanks to the Uruguayan talent and the favorable business environment, the country has become a leading destination for investments in global services.
Publication date: 10/07/2018

Uruguay has consolidated in the last 20 years as the operating base of companies for the rest of Latin America, given its stability and its conditions as a country, reported to EFE Alejandro Ferrari, general coordinator of the Global Services Program for Uruguay XXI institute.

The strengthening of the southern country as a hub is based, in addition to on economic, financial and political stability, on three key platforms with which Uruguay XXI - the state investment and export promotion institute - works in the logistics, business and services areas.

Ferrari explained that Uruguay's momentum as a hub could be placed in the last 20 years, a process that skyrocketed with the approval of the Free Trade Zones Act in 1987, as well as the Investment Promotion Act, which came one year afterwards and that declared national and foreign investments of national interest.

On one hand, the country offers a strategic location at a logistical level that has several advantages, including its proximity to important markets such as Argentina, Brazil, Chile and Paraguay, the executive of Uruguay XXI commented.

Thus, many enterprises choose the country to distribute their products in the region, also helped by the different access routes to markets, such as land, sea and air.

"Uruguay has multimodal advantages compared to other countries. It can be reached by boat, by plane and by land, which gives flexibility and alternatives for companies," he said.

In addition, this strategic location has other additives such as free port, free airport and free trade zone regimes.

"Companies can centralize in Uruguay, fraction and eventually add more value to their products, to then distribute and pay taxes when these stocks enter the countries," he stated.

Regarding the commercial platform, Ferrari stressed that companies "can centralize" their activity in the country and, for example, order in their factories or points of origin and then sell to their customers, with an "attractive tax margin".

The latter is based on centers located in Uruguay that are dedicated to supervising the logistics chain, where the transfer of merchandise, its shipping, costs, taxes and arrival at destination are coordinated.

On the services side, the country has an "administrative and financial support", which allows for "billing to customers, payment to suppliers, financial reports, treasury of company’s money movements and support for human resources functions ", Ferrari added.

In order for the country to continue growing as a business operating base, it is essential that emphasis will be placed on human resources and talent, since the platforms -which can be combined with each other- "are nourished by people," Ferrari said.

In this sense, he considered training to be the main challenge for the country to continue growing.

"Like many countries, our challenge is to have more people related to technological issues, with knowledge based on mathematics," added the head of Global Services for Uruguay XXI.

Although Uruguay has consolidated as a regional hub, for Ferrari it is important to continue adding competitive advantages, not only for companies to choose the country, but also for those that already have done so to stay and expand.

"You compete for things that are built and that all the other countries are fighting to have. I think there is a greater challenge to build all the elements that make this business environment," EFE concluded.

Source: EFE

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