End of drought boosts economic growth in Uruguay with clear “rebound” effect, experts say – La Nación

2024-09-15 11:01:46

By Gerardo Laborde

MONTEVIDEO, (Xinhua) – The end of the drought in Uruguay, which is considered the most severe in many years, has caused economic growth with a clear “rebound” effect, achieving an expansion of 3.8 percent year on year in the second quarter of the year. year, experts consider today Friday.
“It is a significant growth figure that we have not seen for several quarters,” Martin Alesina, a researcher at the Center for Economic Studies and Social Reality (CERES), told Xinhua.
«This year there was no drought and that will boost exports. There was also more hydroelectric production” due to the end of the water deficit, the economist said, despite the fact that according to the National Accounts Report of the Central Bank of Uruguay (BCU) this was an expected result because ” the second one. quarter of 2023 was “especially bad because of the effects of the drought.”
Likewise, the president of the Center for Development Studies, Hernán Bonilla, recalled that “last year we had bad data because of the drought.”
“We have one this year that is better because of that comparison replay in the agricultural sector,” he said in an interview for local television.
In seasonally adjusted terms, the Gross Domestic Product (GDP) increased by 2.0 percent compared to the first quarter of 2024, while in 2023 the economy expanded by 0.4 percent and in the first quarter of 2024 it gave a jump of 0.6 percent year on year face. – year.
In terms of production, the positive performance of the Agriculture, Fisheries and Mining sector stands out (22.6), due to the impact of a good result in the soybean harvest after the drought, although it was partially offset by the lower activity of Manufacturing . industry (-0.5 percent) and Professional Activities (-0.4 percent).
Alesina pointed out that the other effect created by this growth is the price relationship with Argentina, which is “no longer reasonably cheap and consumption has not fallen to the same extent as a year ago.”
By 2024, CERES manages a growth of between 3 and 3.5 percent driven by recovery after the drought and the total potential production of the UPM 2 pulp mill, in the center of the country.
“A good part of the growth in 2024 is a reversal from the bad 2023 (…) In 2025 we would be back to the rates that served us in Uruguay, which are very low,” summarized Alesina.
The Government of President Luis Lacalle Pou cut its growth forecast for 2024 from 3.5 to 3.0 percent in July, in line with the average of the latest expectations survey among analysts conducted by the BCU last month.