RIYADH: Trade relations between Saudi Arabia and Uruguay are poised to advance following the signing of a memorandum of understanding to establish a joint business council.
The inaugural meeting of the Saudi-Uruguayan joint committee, held at Uruguay’s Ministry of Foreign Affairs in Montevideo, concluded with the deal, according to the Saudi Press Agency.
The Saudi delegation was led by Ahmed Al-Khamshi, undersecretary of the Ministry of Environment, Water and Agriculture, while Deputy Foreign Minister Nicolas Albertoni headed the Uruguayan side.
Uruguay, a country of just 3.5 million people sandwiched between giants Argentina and Brazil, is promoting investment options in a number of areas, with emphasis on agribusiness and renewable energy, and its capacity to be a new breadbasket for the Middle East and North Africa.
Despite its size, Uruguay is the world’s ninth-largest exporter of rice, according to the US Department of Agriculture. It is the 17th-largest beef-producing country and the fourth-largest dairy exporter.
While beef is certainly among Uruguay’s list of potential products, dairy could be the game-changer of the country’s trade relations with Saudi Arabia.
Uruguay’s economy is expected to grow 3.4 percent this year and 3 percent next year, according to the International Monetary Fund.
The Washington-based lender said the recovery of agricultural exports, increased cellulose production, the easing of financial conditions, robust private consumption, and a recovery in real wages are expected to support economic growth.
In August 2023, a 60-member delegation from Saudi Arabia, led by Investment Minister Khalid Al-Falih, attended an investment forum in Montevideo.
The visit underscored Saudi Arabia’s increasing focus on Uruguay as a key investment destination and was the third high-profile delegation visit from the Kingdom to Uruguay in the past 18 months.
The previous visit, which occurred just a month before, was headed by Foreign Affairs Minister Adel Al-Jubeir. This pattern of frequent high-level visits reflects the strengthening ties and growing economic interest between the two nations.
According to the Observatory of Economic Complexity, Saudi Arabia exported $30.5 million worth of goods to Uruguay in 2022. This marked an increase of $10.5 million from 2017. The key Saudi exports to Uruguay included mixed mineral or chemical fertilizers and ethylene polymers.
In the same year, Uruguay exported $17.3 million worth of goods to Saudi Arabia. The primary products in these exports were concentrated milk, butter, and frozen bovine meat.
This trade exchange highlights the growing economic relationship between the two countries, with Saudi Arabia focusing on industrial and chemical products, while Uruguay exports dairy and meat products.
