Uruguay is beginning to look beyond its traditional trading partners in an international landscape marked by trade tensions, growing protectionism, and a reconfiguration of global leadership. In this new paradigm, South American countries have started actively exploring economic integration opportunities with regions that have remained largely untapped until now, such as the Arab world and the Asia-Pacific bloc. Uruguay seeks to expand trade opportunities as part of a broader strategy to diversify markets and foster long-term sustainable growth.
During a recent working breakfast organized by the consulting firm Exante, Juan Labraga, Director of Trade Policy Advisory at the Ministry of Economy and Finance (MEF), outlined the country’s main strategic lines in foreign trade. His remarks pointed directly to Uruguay’s interest in establishing formal channels with Arab countries and the urgent need to deepen existing agreements, such as Mercosur’s deal with India.
Labraga emphasized that the current international order no longer adheres to the logic of a unipolar world dominated by the United States. The relative decline of American influence and the emergence of new economic power centers in Asia and the Middle East compels countries like Uruguay to recalibrate their international integration strategies. Uruguay seeks to expand trade opportunities in this new geopolitical reality by targeting markets with strong growth potential and complementary economic profiles.
“The United States is no longer the center of a homogeneous unipolar world,” stated the official. This geopolitical shift means that other regions are gaining prominence, generating new rules of the game. For Labraga, Uruguay cannot remain passive in the face of this transformation.
One of the areas he highlighted was the Asia-Pacific region beyond China. According to the MEF representative, this vast bloc offers untapped potential for Uruguay. However, he also emphasized Arab countries—especially given their high purchasing power and need to import food products—an area where Uruguay holds a significant competitive advantage. Uruguay seeks to expand trade opportunities by leveraging its strength in agri-food exports to penetrate markets that are net food importers and offer premium prices.
Uruguay, traditionally focused on markets such as Brazil, Argentina, the European Union, or China, is now seriously considering its relationship with Gulf countries. Labraga noted that there are “very interesting markets” in that region, mainly due to the high prices they pay for food—well above international averages.
Six Arab Nations Draw Uruguayan Exporters’ Interest
Six countries have captured the attention of Uruguayan exporters: Saudi Arabia, Bahrain, the United Arab Emirates, Kuwait, Oman, and Qatar. Together, they are home to around 60 million people and boast high per capita incomes. Additionally, they are significant net food importers due to their limited domestic production capabilities.
According to data from the Uruguayan Exporters Union (UEU), exports to these countries reached $61 million in 2024. Of that total, the United Arab Emirates was the top destination, absorbing nearly $23 million in Uruguayan products. The most notable exports were whole milk powder, butter, lamb meat, and other meat-based preparations.
Despite these promising figures, Labraga was clear: Uruguay does not yet have a solid foothold in these markets. This is partly because regional competitors like Brazil and Argentina have already secured a strong commercial presence, thanks to tariff advantages and preexisting agreements. The challenge, therefore, is not only production but crafting an effective market entry strategy to gain ground in these regions. Uruguay seeks to expand trade opportunities by building bilateral relationships, negotiating trade preferences, and differentiating its high-quality agricultural goods.
The Need to Deepen the Mercosur–India Agreement
Labraga also addressed the current trade agreement between Mercosur and India. In force since 2009, this was the first agreement the South American bloc signed with a non-regional partner. However, its scope is limited, providing fixed tariff preferences for only a narrow range of products.
An analysis by the MEF—supported by a recent report from the International Business Institute of the Catholic University—shows that only 1% of Uruguayan exports in 2024 benefited from the agreement. For Labraga, this proves the deal is “very poorly leveraged,” and significant room exists for deepening it.
Expanding such agreements—not just with India but with other countries in Asia and the Middle East—could open up many opportunities for Uruguayan exporters, especially in the agri-industrial sector, where the country has extensive experience and an international reputation. Uruguay seeks to expand trade opportunities through more comprehensive, updated agreements that reflect its economic strengths and modern trade needs.
New Approaches to Trade Liberalization
The international context presents uncertainties, mainly due to the protectionist policies adopted by the United States under the Trump administration. Labraga acknowledged that Uruguay will need to adapt to the timing and conditions set by the U.S. if it wishes to advance in bilateral agreements. Nevertheless, he also proposed an alternative: unilateral liberalization.
The MEF is considering implementing autonomous measures to promote trade liberalization without necessarily waiting for regional or multilateral consensus. This approach aims to accelerate the country’s integration into global trade through independent decisions that boost exports and investment attraction. Uruguay seeks to expand trade opportunities by reducing reliance on slow-moving multilateral frameworks and proactively shaping its trade agenda.
A key issue addressed during the meeting was the need to review non-tariff barriers within Uruguay. Labraga argued that, in many cases, local regulations create distortions that hinder both competition and investment flows.
“There is a growing political, technical, and business consensus about the need to change certain rules of the game,” he noted. In that regard, the MEF is conducting a joint assessment with various market stakeholders to identify the regulatory hurdles that most impact trade and investment.
According to Labraga, the goal is not to eliminate regulations indiscriminately but to apply “smart regulation” that offers certainty without suffocating the private sector. In some cases, he stated, “deregulation will be necessary,” particularly when bureaucratic procedures are shown to obstruct productive projects.
One sector where visible impacts are sought is investment. Labraga stressed that the Ministry aims to implement “concrete measures this year that will drive investment.” One example he mentioned was the digitalization of COMAP (Commission for the Application of the Investment Law), a key body for approving tax benefits.
The process of market diversification and structural reform will not be immediate or without challenges. It requires a long-term vision and political will to move forward with new agreements and adjust regulations that no longer align with today’s international dynamics.
Uruguay seeks to expand trade opportunities by strengthening its global presence and seizing high-value niches in regions that have remained secondary in its trade agenda until now. The Arab world and the Asia-Pacific region represent areas where the country can grow, provided it acts with intelligence, speed, and pragmatism.
Furthermore, improving existing agreements and reviewing domestic regulations could position Uruguay as a reliable hub for foreign investment, thereby boosting its medium- and long-term economic development.