(From Montevideo, Uruguay) – The The number of Uruguayan companies that sell to Argentina reached a maximum in 2018, but after that peak it began to decline. In 2023 there were 371 and only 45 made shipments of more than USD 1 million; In that year, exports totaled USD 565 million, 47% less than in 2022. For Uruguayan industrialists They were “horrible” monthsas defined by the president of the Chamber of Industries of Uruguay (CIU)Fernando Pache.
But with the assumption of Javier Milei The situation has changed since businessmen They began to collect the debts they had in arrears from Argentine importers. However, the sector has not yet recovered because sales to the neighboring country are not normalizedbut at the same time maintains moderate optimism, according to the businessmen in the sector consulted in Search.
Uruguayan industries They had to make operational and personnel adjustments and took bank loans to get through the problems they had last year, but now they face a drop in demand. “The situation has improved from a regulatory point of view. The problem is that the reality of the market is complex and it is not possible to resume the previous pace of placement due to the economic situation in Argentina.. If there are no sales, there is no market,” described the president of Foreign Trade of the CIU, Washington Durán.
The “very harsh” reality of Uruguayan companies has caused them to some firms have been left “by the way” and others support with internal adjustment measures, Durán explained. For many of them, the Argentine market is the place to grow because “they have no chance to look for another destination abroad, or because of the product they sell, because of competitiveness or because of their own infrastructure.”
This crisis is reflected in some decisions such as the Brazilian auto parts company Fanacif, which sent its entire workforce to unemployment insurance at the beginning of April due to financial problems and which last week announced the closure of its industrial operation in Uruguay. In part, the decision was due to the commercial debts of Argentine clients, as reported by the Uruguayan media.
The manager of the Darnel recyclable packaging factory, Alberto Brause, reported as an example that his company went from placing 25% of its production in the Argentine market to 8%. “We are seeing recessive consumption in Argentina that hits us”, he justified. The company had the expectation of recovering the sales volume lost with the change of government and the liberalization of imports, but business does not reach the expected level, at least in the first months of the year. “Consumption went down. We are selling less. We are seeing a sharp decline, around 20% or 30% compared to the previous year,” he reported.
This company acquired a production plant in Zárate last year as part of a strategy to “continue participating strongly within” the Argentine market.
Pache, the president of the CIU, is director of one of the companies that exports to Argentina. The businessman warned his clients at the beginning of the year that if they did not pay their old debts, he would have to suspend the delivery of merchandise.. “We had a fortune, for our pockets, in defaults. Today we have collected it. Our product is in high demand in the region, so we talked calmly (…) and the customers looked for a way and complied so as not to run out of raw materials,” he commented.
The president of Foreign Trade of the business association indicated that, as in Argentina “everything is very dynamic,” You cannot make “too many predictions” about the future. He noted, however, that There is “moderate optimism” among industrialists because, in general terms, the impact situation is “normalizing and channeling,” which allows them to begin to recover working capital.
