{
  "title": "IMF Executive Board Concludes 2023 Article IV Consultation with Uruguay",
  "publication": "IMF News, May 17, 2023",
  "sourceUrl": "https://www.imf.org/en/news/articles/2023/05/17/pr23157-uruguay-imf-executive-board-concludes-2023-article-iv-consultation",
  "canonical": "https://www.imf.org/en/news/articles/2023/05/17/pr23157-uruguay-imf-executive-board-concludes-2023-article-iv-consultation",
  "overlayPath": "/en/news/articles/2023/05/17/pr23157-uruguay-imf-executive-board-concludes-2023-article-iv-consultation/index.md",
  "summary": "The Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation [1] with Uruguay on May 15, 2023. After reaching pre-pandemic levels in mid-2021, real GDP grew by 4.",
  "publishDate": "2023-05-17",
  "sections": [
    {
      "heading": "Recent developments and macroeconomic performance",
      "content": "- The Executive Board concluded the Article IV consultation with Uruguay on May 15, 2023 (Press Release No. 23/157; May 17, 2023).\n- Real GDP:\n  - After reaching pre-pandemic levels in mid-2021, real GDP grew by 4.9 percent in 2022 driven by strong commodity exports and the service sector, including tourism.\n- Growth dynamics in 2022:\n  - The economy decelerated in the second half of 2022 due to adverse external conditions and the effects of the most severe drought in forty years.\n- Inflation:\n  - Inflation remained above the target range in 2022.\n  - Inflation peaked in September 2022 at 9.95 percent and declined towards the end of the year, reaching 7.3 percent in March 2023."
    },
    {
      "heading": "Monetary policy and exchange rate",
      "content": "- Banco Central del Uruguay (BCU) actions:\n  - Policy rate raised from 5.75 percent in December 2021 to 11.5 percent in December 2022.\n  - BCU implemented an interest rate cut of 25 basis points in its April 2023 meeting, citing declining inflationary pressures.\n- Policy guidance from Directors:\n  - Maintain a tight monetary stance until price pressures and inflation expectations converge to the target band.\n  - Strengthen de jure central bank independence to bolster monetary policy credibility and support efforts to reduce dollarization.\n  - Exchange rate should act as a shock absorber; FX interventions should be limited to responding to disorderly market conditions."
    },
    {
      "heading": "Fiscal performance and policy recommendations",
      "content": "- Fiscal trends:\n  - Fiscal deficit and government debt declined substantially over the last two years, reflecting adherence to the fiscal rule while protecting the most vulnerable.\n  - Gross non-financial public sector (NFPS) debt: peaked at 68.1 percent of GDP in 2020 and reached 59.3 percent of GDP at the end of 2022.\n  - Overall fiscal risks are assessed as low.\n- Directors’ recommendations:\n  - Priority: continued strong compliance with the current fiscal rule.\n  - A more explicit debt objective could be a useful component of a medium-term fiscal strategy.\n  - A modest fiscal impulse in 2023 is appropriate, with measures to put debt on a downward path once drought effects abate.\n  - Recommended measures: further rationalize tax expenditures, improve targeting of subsidies, reduce the wage bill, and preserve social cohesion.\n  - Directors welcomed the recently approved pension reform as supportive of stabilizing long-term pension spending."
    },
    {
      "heading": "Financial sector resilience and regulatory priorities",
      "content": "- Financial sector status:\n  - The health of the financial sector remains sound; banks have weathered the pandemic well.\n  - Directors welcomed that the financial sector remains resilient and healthy.\n- Recommended actions:\n  - Enhance financial supervision to bolster resilience to shocks and improve confidence.\n  - Promote domestic capital market development.\n  - Continue implementation of recent FSAP recommendations and progress toward creating a comprehensive AML/CFT national plan."
    },
    {
      "heading": "Structural reforms, climate policy, and social priorities",
      "content": "- Structural reform priorities:\n  - Continue ambitious structural reforms to maintain resilience and support sustainable and inclusive growth.\n  - Address long-standing human capital erosion and skill gaps; further efforts needed following recent education reforms.\n  - Improve efficiency and productivity of state-owned enterprises and enhance trade integration.\n- Climate leadership:\n  - Directors commended Uruguay’s leadership in climate change policy and integration of climate policies into the overall policy agenda.\n  - Noted the successful issuance of a Sovereign Sustainability-Linked Bond and significant progress in reducing greenhouse gas emissions intensity.\n  - Encouraged continued efforts to transform Uruguay into a climate-resilient, green, and sustainable economy."
    },
    {
      "heading": "Outlook and risks",
      "content": "- Growth projections and near-term outlook:\n  - The economy is expected to decelerate in 2023, with real GDP growth projected at 2 percent.\n  - Growth drivers in 2023: strong tourism season, increased cellulose production and exports, and robust private consumption as real wages recover.\n  - Growth outlook after 2023 is positive but subject to external and domestic risks.\n- Inflation outlook:\n  - Inflation is expected to decline to 7 percent in 2023 and fall within the target range in 2024.\n- Main macroeconomic risks:\n  - Worsening of external financial conditions.\n  - Deterioration of international geopolitical tensions.\n  - Continued impact of the drought."
    },
    {
      "heading": "Key statistics (select indicators and projections)",
      "content": "- Real GDP (percent change): 2021: 5.3; 2022: 4.9; 2023: 2.0; 2024: 3.0\n- GDP (US$ billions): 2021: 61.4; 2022: 71.2; 2023: 76.5; 2024: 80.5\n- Unemployment (in percent, pa): 2021: 9.4; 2022: 7.9; 2023: 8.2; 2024: 8.1\n- Output gap (percent of potential output): 2021: -2.0; 2022: -0.4; 2023: -0.6; 2024: -0.2\n- CPI inflation (in percent, end of period)): 2021: 8.0; 2022: 8.3; 2023: 7.0; 2024: 5.7\n- Policy rate evolution: 5.75 percent (December 2021) → 11.5 percent (December 2022); April 2023: cut of 25 basis points\n- Gross debt NFPS: 2021: 63.4; 2022: 59.3; 2023: 61.6; 2024: 61.9 (percent of GDP)\n- Net debt NFPS: 2021: 53.3; 2022: 50.5; 2023: 52.9\n- Merchandise exports, fob (US$ billions): 2021: 15.7; 2022: 17.2; 2023: 15.5; 2024: 16.6\n- Merchandise imports, fob (US$ billions): 2021: 11.2; 2022: 13.6; 2023: 13.3; 2024: 14.5\n- Gross official reserves (US$ billions): 2021: 17.0; 2022: 15.1; 2023: 16.1; 2024: 16.3\n- In months of imports of goods and services: 2021: 13.7; 2022: 9.7; 2023: 10.4; 2024: 9.8\n- External debt service (in percent of exports of g&s): 2021: 57.7; 2022: 53.7; 2023: 61.8; 2024: 52.7\n- Total external debt + non-resident deposits (percent of GDP): 2021: 79.4; 2022: 78.0; 2023: 79.1; 2024: 77.4\n- Of which: External public debt (percent of GDP): 2021: 34.7; 2022: 29.1; 2023: 33.6; 2024: 32.4\n\nSource: Press Release No. 23/157, IMF Communications Department (May 17, 2023).\n\n---\n\n\n References\n\n- https://www.imf.org/-/media/images/imf/bios/imfboard.jpg\n- The Executive Board\n- Uruguay and the IMF\n- IMF Policy Advice -- A Factsheet\n- Press Releases\n- PRESS CENTER\n- http://www.IMF.org/external/np/sec/misc/qualifiers.htm\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2023/05/17/pr23157-uruguay-imf-executive-board-concludes-2023-article-iv-consultation"
    }
  ],
  "bullets": [
    "[Markdown version](/en/news/articles/2023/05/17/pr23157-uruguay-imf-executive-board-concludes-2023-article-iv-consultation/index.md)",
    "[Structured JSON version](/en/news/articles/2023/05/17/pr23157-uruguay-imf-executive-board-concludes-2023-article-iv-consultation/index.json)",
    "[Bundle manifest](/en/news/articles/2023/05/17/pr23157-uruguay-imf-executive-board-concludes-2023-article-iv-consultation/bundle-manifest.json)",
    "Published: May 17, 2023",
    "The Executive Board concluded the Article IV consultation with Uruguay on May 15, 2023 (Press Release No. 23/157; May 17, 2023).",
    "Real GDP:",
    "Growth dynamics in 2022:",
    "Inflation:",
    "Banco Central del Uruguay (BCU) actions:",
    "Policy guidance from Directors:",
    "Fiscal trends:",
    "Directors’ recommendations:",
    "Financial sector status:",
    "Recommended actions:",
    "Structural reform priorities:",
    "Climate leadership:",
    "Growth projections and near-term outlook:",
    "Inflation outlook:",
    "Main macroeconomic risks:",
    "Real GDP (percent change): 2021: 5.3; 2022: 4.9; 2023: 2.0; 2024: 3.0",
    "GDP (US$ billions): 2021: 61.4; 2022: 71.2; 2023: 76.5; 2024: 80.5",
    "Unemployment (in percent, pa): 2021: 9.4; 2022: 7.9; 2023: 8.2; 2024: 8.1",
    "Output gap (percent of potential output): 2021: -2.0; 2022: -0.4; 2023: -0.6; 2024: -0.2",
    "CPI inflation (in percent, end of period)): 2021: 8.0; 2022: 8.3; 2023: 7.0; 2024: 5.7",
    "Policy rate evolution: 5.75 percent (December 2021) → 11.5 percent (December 2022); April 2023: cut of 25 basis points",
    "Gross debt NFPS: 2021: 63.4; 2022: 59.3; 2023: 61.6; 2024: 61.9 (percent of GDP)",
    "Net debt NFPS: 2021: 53.3; 2022: 50.5; 2023: 52.9",
    "Merchandise exports, fob (US$ billions): 2021: 15.7; 2022: 17.2; 2023: 15.5; 2024: 16.6",
    "Merchandise imports, fob (US$ billions): 2021: 11.2; 2022: 13.6; 2023: 13.3; 2024: 14.5",
    "Gross official reserves (US$ billions): 2021: 17.0; 2022: 15.1; 2023: 16.1; 2024: 16.3",
    "In months of imports of goods and services: 2021: 13.7; 2022: 9.7; 2023: 10.4; 2024: 9.8",
    "External debt service (in percent of exports of g&s): 2021: 57.7; 2022: 53.7; 2023: 61.8; 2024: 52.7",
    "Total external debt + non-resident deposits (percent of GDP): 2021: 79.4; 2022: 78.0; 2023: 79.1; 2024: 77.4",
    "Of which: External public debt (percent of GDP): 2021: 34.7; 2022: 29.1; 2023: 33.6; 2024: 32.4",
    "[https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg)",
    "[The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx)",
    "[Uruguay and the IMF](http://www.imf.org/external/country/URY/index.htm)",
    "[IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)",
    "[Press Releases](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[http://www.IMF.org/external/np/sec/misc/qualifiers.htm](http://www.imf.org/external/np/sec/misc/qualifiers.htm)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
  ],
  "alternates": {
    "markdown": "/en/news/articles/2023/05/17/pr23157-uruguay-imf-executive-board-concludes-2023-article-iv-consultation/index.md",
    "json": "/en/news/articles/2023/05/17/pr23157-uruguay-imf-executive-board-concludes-2023-article-iv-consultation/index.json",
    "bundleManifest": "/en/news/articles/2023/05/17/pr23157-uruguay-imf-executive-board-concludes-2023-article-iv-consultation/bundle-manifest.json"
  },
  "generatedAtUtc": "2026-09-26T02:04:15.439Z"
}