Uruguayan companies face challenges amid economic differences with Argentina

The economic crisis in Argentina has led to a notable trend of Uruguayans crossing the border in search of more affordable food and fuel.

However, this influx of cross-border shopping has resulted in a crisis for businesses in the border region of Uruguay.

While the Argentine peso has experienced a significant devaluation of approximately 25% against the dollar this year, Uruguay’s local currency has strengthened in comparison.

With an annual inflation rate of 6%, Uruguayan businesses near the border have lost their competitive edge.

Noelia Romero, a supermarket manager in Fray Bentos, a city separated from Argentina’s Gualeguaychu by the Uruguay River, has witnessed a sharp decline in sales.

“We’ve experienced a significant decline in the sale of groceries and cleaning products,” Romero stated.

Robert de Lima, who traveled 45 km from Uruguay to Gualeguaychu, highlighted the stark contrast in fuel prices, saying, “In Uruguay, fuel costs the equivalent of US$1.58 per liter, whereas in Argentina, we pay only US$0.53.”

Abelardo Alzaibar, a pharmacy owner in Fray Bentos, expressed the challenges faced by local commerce due to the price disparity, despite efforts by the Uruguayan government to alleviate the situation.

“The price difference creates significant problems for local businesses, leading to closures, with no immediate resolution in sight,” Alzaibar lamented.

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