Uruguay Roundup: Trade strategy, political divisions, economic pressures

EU–Mercosur agreement framed as the world’s largest free trade zone and a strategic bet for Uruguay

Uruguay continues to position the EU–Mercosur agreement as a historic opportunity, with supporters describing it as the creation of the world’s largest free trade zone. The deal is seen by the government as a strategic bet to expand market access, attract investment, and strengthen Uruguay’s role as a reliable trading partner between South America and Europe, even as negotiations face resistance within the EU.

European Union proposes unlocking €45 billion to ease agricultural protests linked to Mercosur

The European Union has proposed mobilising €45 billion (US$52.2) to calm widespread agricultural protests opposing the EU–Mercosur agreement. The move reflects internal European tensions over the deal, particularly concerns from farmers about competition, standards, and market disruption, developments closely watched in Uruguay, given the agreement’s centrality to its export strategy.

Uruguay’s political system remains divided over the situation in Venezuela

Uruguay’s political landscape is once again split over how to approach the crisis in Venezuela. Disagreements persist across parties on diplomatic positioning, recognition of leadership, and responses to human rights concerns, underscoring long-standing ideological divisions in the country’s foreign policy debates.

Antifascist organisation challenges Yamandú Orsi over comments on Nicolás Maduro

An antifascist organisation has publicly questioned Uruguay's President Yamandú Orsi following his comments on Venezuelan President Nicolás Maduro. Orsi stated that Maduro’s departure would be positive only if it led to the end of authoritarianism and the restoration of democracy, remarks that have sparked criticism and renewed scrutiny of political discourse surrounding Venezuela.

Economic debate intensifies over exchange rate lag, flat dollar, and competitiveness

Uruguay is facing renewed debate over what has been described as a “so-called” exchange rate lag, with data from the end of 2025 fuelling concerns about competitiveness. A flat dollar has helped keep inflation low but at the cost of export competitiveness, while water stress has also brought the issue of guaranteeing potable water supply back into focus, highlighting the interconnected pressures facing the country’s economic model.