The Uruguayan economy recorded a 1.2% growth in the first quarter of 2023 compared to the same period in 2022, as per the Central Bank of Uruguay (BCU). The rise is attributed to an uptick in consumption and exports.
According to the BCU’s National Accounts Report, the Gross Domestic Product (GDP), in seasonally adjusted terms, experienced a 0.9% expansion relative to the final quarter of the previous year (October-December).
Consequently, the economy managed to reverse the technical recession it plunged into during the latter half of 2022, when it registered two consecutive quarters of decline (-0.1% and -1.3%, respectively).
From a production perspective, the first quarter (January-March) was characterized by significant growth in the Transport, Storage, Information and Communications (+5.6%), and Trade, Accommodation, Food, and Beverage Supply (+3.4%) sectors.
However, the boost was partially offset by a 4.3% decline in the Agriculture, Fishing and Mining sectors due to the country’s severe drought.
The water deficit also had a detrimental impact on the Electric Power, Gas, and Water industry, which witnessed a 0.7% decline.
With regards to the expenditure component, final consumption expenditure or consumption saw an increase of 1.6%.
This contrasted with a decrease in gross capital formation or investment, which dropped by 6.5%.
In volume terms, exports saw a 14.0% rise, while imports increased by 12.1%.
Despite a significant slump in the second half of the year, Uruguay’s GDP saw an expansion of 4.9% in 2022.
For 2023, President Luis Lacalle Pou’s government is projecting economic growth of approximately 2%.