Renewable Energy & Green Hydrogen
Based on a 94% renewable electricity matrix, stability, outstanding tax incentives and a longstanding commitment to sustainability, Uruguay offers investment opportunities in the entire green hydrogen chain and derivatives, as well as in the production of biofuels and the assembly of electric vehicles.Uruguay is committing to consolidate a green hydrogen and derivates industry that, according to its 2040 strategy, could reach a turnover of US$ 1900 million per year and more than 30,000 quality jobs. Within the framework of national and international decarbonization goals, green hydrogen and its derivatives, with its capacity to decarbonize different uses, has positioned itself as a relevant carrier on the global agenda. Uruguay has achieved the first stage of its energy transformation, based on the decarbonization of its electricity matrix, with 97% renewable between 2017 and 2020. The second stage of the energy transformation includes, among other challenges, the decarbonization of the rest of the energy sector and raw materials, and the development of a hydrogen economy for both the local market and for export. After a process of analysis and exchange with relevant actors at national and international level, it is concluded that Uruguay has very good conditions for the development of green hydrogen and derivatives. This is due to its large amount of renewable energy sources and biogenic CO2, as well as its institutional stability and strong democracy. It is from this conclusion that the present 2040 roadmap is proposed. Uruguay’s Green Hydrogen and Derivatives Roadmap under consultation until August 15, 2023. Its final version is now published. It is expected that, through this strategy, Uruguay will consolidate a strong industry based on green hydrogen and its derivatives, taking into account that several potential exporting countries have already expressed their interest. Among the expected results, it is foreseen that by 2040 our country will have an annual turnover of US$1900 million and will generate more than 30,000 quality jobs. Over the past decade Uruguay has dramatically shifted its energy matrix to renewable sources, placing it at the forefront of clean power in the region. Energy companies are increasingly eyeing green hydrogen investments in Latin America as a way to help combat climate change.
Pharmaceuticals
Pharmaceuticals are the leading industry in the life science sector. Uruguay has a long history in pharmaceuticals and has over 30 pharmaceutical facilities. Approximately 61 percent of the national production is produced for the domestic market and 39 percent for export markets. The workforce is highly skilled and knowledgeable, and the government has established a transparent regulatory framework in which companies and laboratories operate. International firms have raised concerns about Uruguay’s pharmaceutical intellectual property regime, which can take up to 10 years to grant intellectual property rights to international pharmaceutical producers. According to Uruguay XXI, in 2022, Uruguay’s pharmaceutical exports amounted to USD $183 million by 17 companies (more than half of them were exported from free trade zones, more specifically form Zonamerica and Parque de las Ciencias), representing 1.4 percent of the total amount of exports of the country. Exports of veterinary products totalled USD $103 million. Both products of human and veterinary use were predominantly sold to other Latin American countries, primarily Argentina. Additionally, Uruguay’s pharmaceutical industry exports vaccines and serums, primarily for veterinary use and packaged for retail sale. India’s impact on the global pharmaceutical industry cannot be underestimated: it supplies 20% of all global generic exports, 40% of US generic demand and 25% of all UK medicines. Reviewing their ongoing bilateral cooperation, India and Uruguay in 2021 identified steps to strengthen and boost sectors including trade and investment and access to pharmaceutical products.This was among the issues discussed at the 4th Foreign Office Consultations between India and Uruguay held in Montevideo.
Food & Beverages
Uruguay uniquely appeals as a regional platform for the food and ingredients industry. The competitiveness of its primary and primary processing chains, in addition to access to imported raw materials without paying tariffs and other tax incentives, its strategic location that offers access to an expanded market of 400 million people, and its economic and legal stability position it as a critical player in regional and global supply chains and as a trading or service center. These attributes are traditionally exploited by large companies such as U.S.-based PepsiCo, Switzerland’s Nestlé, and Denmark’s Lactosan, to name a few.s part of the food industry, ingredients are intermediate products that arise after a first transformation of the raw material into a standardized product that is easy to incorporate into the formulation of different foods. They are essential since they provide specific characteristics to the final products, such as flavor, texture, color, preservation, and nutrition.Uruguay offers excellent advantages for producing and exporting ingredients to the world. In addition to the abundance of land suitable for agriculture and livestock, the wide availability of primary products, and the Temporary Admission (TA) regime, which allows the import of inputs without paying taxes, there is ample access to regional and international markets, which facilitates trade and the expansion of companies in the region. The proximity to customers and the short delivery times facilitate the adaptation of products.Other examples of large foreign companies are the Swedish Danish food and beverage company Aarhuskarlshamn (AAK), located in the Zona Este Industrial Park, which specializes in the production and marketing of plant-based ingredients such as vegetable oils, fats, lecithin, and emulsifiers. Uruguay also produces meat ingredients, such as artificial casings, additives, preservatives, and flavors, and the Spanish multinational Viscofan, a leader in producing artificial guts, is taking advantage of the benefits of operating in Uruguay.Thus, the combination of natural resources, efficiency in agricultural production, and capacity for technological innovation, together with its openness to trade, boosts Uruguay’s activity and strengthens its reputation as a reliable and competitive food supplier in the international market.