Trade Deficits in Paraguay and Uruguay

Flag of Uruguay

Flag of Uruguay

By: Donna Welles 

Last week the South American media reported that Uruguayan politicians are being investigated for criminal activity. Argentina, Brazil, and Chile have experienced similar litigation in the past weeks and months. The nature of the investigations into the Uruguayan government is not yet fully understood. Argentina and Brazil have been investigating officials for financial crimes and Chile has been prosecuting military officers for violent crimes committed during the tenure of President Augusto Pinochet.

Uruguay and Paraguay have similar economies and demographics. Paraguay was founded by Spain and for many years Asuncion served as the regional capital for the Spanish Empire. Uruguay was for many years part of Brazil. Ethnically the two countries are similar because they are Spanish and Italian.

Both Paraguay and Uruguay are burdened by trade deficits. There is fluctuation in both countries in terms of imports and exports. Patterns in international trade by way of MERCOSUR as well as trade with North America and the European Union account for some of the fluctuations. Also, both Paraguay and Uruguay have recently upgraded their industry. Uruguay ranches cattle and additionally they export machine works. Paraguay is removed from the Atlantic Ocean but they are located downstream from Buenos Aires, Argentina and therefore enjoy transplanted industrial growth. The Parana River traverses north from Buenos Aires to Paraguay.

In 2011 Paraguay reported exports of $8b USD and imports of $12b USD. In 2012 exports decreased to $7b USD and then in 2013 and in 2014 exports increased to $10b USD. Exports decreased again in 2015 to $8b USD. Paraguay also reported fluctuating imports. In 2011 Paraguay reported imports of $13b USD and in 2012 that number decreased to $12b USD. In 2015 Paraguay reported imports of $10b USD.

In 2011 Uruguay reported exports of $8b USD and imports of $11b USD. In 2012, 2013, and 2014 Uruguay reported exports of $9b USD and then in 2015 Uruguay reported exports of $8b USD. Imports increased in 2012 to $12b USD. In 2015 Uruguay reported imports of $9b USD. Holistically Uruguay has reported a lessened trade deficit since 2011. In 2011 their trade deficit was $3b USD and in 2015 Uruguay reported a trade deficit of $2b USD.

Paraguay has a population of 7m people and Uruguay has a population of 4m people. Uruguay has a GDP of $58b USD and Paraguay has a GDP of $31b USD. Paraguay has a largest city of 3m people and Uruguay has a largest city of 2m people. Uruguay has a life expectancy of 77 years and Paraguay has a life expectancy of 72 years. Montevideo is the capital of Uruguay and Asuncion is the capital of Paraguay.

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