He International Monetary Fund (IMF) He highlighted the solidity of Uruguayan institutions, macroeconomic stability and the country’s ability to face external shocks, although he warned that increasing economic growth is Uruguay’s main challenge.
In its latest report on the country, the organization said that a moderate growth in the Gross Domestic Product (GDP) of 1.3% is “expected” in 2026 – affected by the consequences of the drought on agricultural production in 2025 – and projected an expansion of 2.4% in 2027.
The document, published in November 2026, corresponds to the consultation of Article IV, a mechanism through which the IMF carries out periodic evaluations of the economies of its member countries.
In its analysis, the organization maintained that Uruguay “continues to demonstrate resilience, supported by solid institutions and credible economic policy frameworks.”
He also highlighted that the direct effects of the increase in oil prices and international trade uncertainty were “limited”, in part due to the high participation of “renewable energies” in the electrical matrix and the “favorable prices” of export products.
“The country continues to demonstrate resilience, supported by strong institutions and credible policy frameworks. The direct macroeconomic effects of the oil price crisis and increased global trade policy uncertainty have been limited, thanks to the high share of renewable energy in Uruguay and favorable export prices. Uruguay continues to benefit from solid market access, with sovereign spreads that remain the lowest in the region and remain near historical lows,” the document explains.
The agency warned that future risks for the economy are tilted downward; Among the factors that could affect the country’s performance, he mentioned a tightening of international financial conditions, shocks in oil prices, greater geoeconomic fragmentation and adverse climatic phenomena.
Martin Vallcorbaundersecretary of Ministry of Economy and Financeshared the report on X and wrote: “IMF highlights the resilience of (Uruguay), the solidity of its institutions and the credibility of its economic policy frameworks. “The macroeconomic solidity, the fulfillment of fiscal goals and the strength of the financial system stand out.”
The IMF recommended reviewing health and education items to identify “less productive” expenses
In tax matters, the IMF He appreciated that Uruguay has met the goals established for 2025, despite the economic “slowdown.”
He also considered it positive that the government maintained the fiscal consolidation objectives defined in the five-year budget. The organization pointed out that the government deficit and the Social Security Bank It reached 3.7% of GDP in 2025, compared to 3.1% in 2024. By 2026, it projected that the deficit, under that same measurement, will reach 4.1% of GDP.
However, the report maintained that this effort may not be enough to reduce debt on a sustained basis: “There are risks to the planned fiscal adjustment and it is recommended to prepare additional measures,” the agency’s team stated.
He IMF identified three sources of risk to adjustment: “the international macroeconomic and tax environment, delays in implementation, and spending pressures that may arise further.” forward”.
Based on this diagnosis, he listed some alternatives to strengthen public accounts: reduce tax exemptions, moderate salary expenditure and improve the efficiency of state spending.
It also recommended spending reviews in areas with significant budget allocations, such as health and education. The goal, according to the report, would be to identify items that “have become less productive over time.”
In addition, he proposed strengthening the performance budget, linking to a greater extent the objectives of the programs and their result indicators with budget decisions.
Growth, inflation and employment
The organization noted that the Uruguayan economy grew 1.8% in 2025. The “slowdown” was mainly linked to lower agricultural production, affected by drought since the third quarter of 2025, and temporary interruptions in refining and pulp plants.
By 2026, the IMF It foresees a growth of 1.3%, while for 2027 it projects an expansion of 2.4%, driven by private consumption and investment. Among the projects that could contribute to this recovery, it mentions investments in data centers, energy and infrastructure.
In terms of prices, the performance of the monetary policy of the Central Bank of Uruguay (BCU). Inflation stood at 4.7% in September 2026, while expectations remained aligned with the agency’s goal of 4.5%.
The document maintained that inflation remained “within the tolerance range” of the BCU during “the last three years”, as a result of a monetary policy that he described as “proactive.”
In the labor market, he identified some favorable indicators, but also a persistent difficulty: youth unemployment. In August 2026, the general unemployment rate was 7.2%, close to its historical lows, while among young people it reached 23.4%.
Productivity, public companies and the labor participation gap between women and men
For him IMFOnce macroeconomic stability is preserved, Uruguay’s main challenge is to increase its capacity for growth. The organization pointed out that the country needs to raise productivity and accelerate convergence towards the income levels of advanced economies.
In that sense, he maintained that the government’s reform agenda should aim to “improve the business environment, encourage investment and support innovation.”
The report mentioned the Competitiveness Law and the Uruguay Innova program as initiatives that could contribute to these objectives. He also valued measures aimed at reducing procedures, strengthening competition and eliminating barriers to investment, considering that they can “increase productivity and promote the dynamism of the private sector.”
One of the specific points raised by the organization was the need to reform public companies. He IMF noted that “new SOE reforms, including better alignment of wages with productivity and cost-reflective pricing, would help reduce production costs and strengthen competitiveness”.
The recommendation aims, on the one hand, for the evolution of remuneration in these companies to be more closely related to their productivity and, on the other, for the prices of the goods and services they offer to reflect their costs.
The document also focused on the availability of workers and the formation of human capital: it warned that expanding the labor supply and strengthening the capabilities of workers is “fundamental to sustaining growth in a context of demographic pressures.”
Among the priorities, he listed reducing the differences between men and women in participation in the labor market, attracting qualified workers and adjusting education and training to employment needs.
In particular, the IMF estimated that closing the female labor participation gap to the levels of the top decile of countries could raise annual economic growth by 0.2 percentage points in the long term.
