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Uruguay, officially the Oriental Republic of Uruguay or the Republic East of the Uruguay, is a country in South America. It shares borders with Argentina to its west and southwest and Brazil to its north and northeast, while bordering the Río de la Plata to the south and the Atlantic Ocean to the southeast. It is part of the Southern Cone region of South America. Uruguay covers an area of approximately 181,034 square kilometers (69,898 sq mi) and has a population of around 3.5 million, of whom nearly 2 million live in the metropolitan area of its capital and largest city, Montevideo.
The area that became Uruguay was first inhabited by groups of hunter–gatherers 13,000 years ago. The predominant tribe at the moment of the arrival of Europeans was the Charrúa people. There are also other tribes Guarani, Chaná when the Portuguese first established Colónia do Sacramento in 1680. Uruguay was colonized by Europeans late relative to neighboring countries. The Spanish founded Montevideo as a military stronghold in the early 18th century because of the competing claims over the region. Uruguay won its independence between 1811 and 1828, following a four-way struggle between Portugal and Spain, and later Argentina and Brazil. It remained subject to foreign influence and intervention throughout the 19th century, with the military playing a recurring role in domestic politics. A series of economic crises and the political repression against left-wing guerrilla activity in the late 1960s and early 1970s put an end to a democratic period that had begun in the early 20th century, culminating in the 1973 coup d'état, which established a civic-military dictatorship. The military government persecuted leftists, socialists, and political opponents, resulting in deaths and numerous instances of torture by the military; the military relinquished power to a civilian government in 1985. Uruguay is today a democratic constitutional republic, with a president who serves as both head of state and head of government.
Uruguay is ranked first in the Americas for democracy, and first in Latin America in peace, low perception of corruption, and e-government. It is the lowest-ranking South American nation in the Global Terrorism Index, and ranks second in the continent on economic freedom, income equality, per-capita income, and inflows of FDI. Uruguay is the third-best country on the continent in terms of Human Development Index, GDP growth, innovation, and infrastructure. Uruguay is regarded as one of the most socially progressive countries in Latin America. It ranks high on global measures of personal rights, tolerance, and inclusion issues, including its acceptance of the LGBT community. The country has legalized the consumption and production of cannabis, same-sex marriage, prostitution and abortion. Uruguay is a founding member of the United Nations, OAS, and Mercosur.
The country name of Uruguay derives from the namesake Río Uruguay, from the Indigenous Guaraní language. There are several interpretations, including "bird-river" ("the river of the uru, via Charruan, urú being a common noun of any wild fowl). The name could also refer to a river snail called uruguá (Pomella megastoma) that was plentiful across its shores. One of the most popular interpretations of the name was proposed by the renowned Uruguayan poet Juan Zorrilla de San Martín, "the river of painted birds"; this interpretation, although dubious, still holds an important cultural significance in the country. In Spanish colonial times, and for some time thereafter, Uruguay and some neighboring territories were called Banda Oriental ("Eastern Bank "), then for a few years the "Eastern Province". Since its independence, the country has been known as "República Oriental del Uruguay", which literally translates to "Republic East of the Uruguay ". However, it is officially translated either as the "Oriental Republic of Uruguay" or the "Eastern Republic of Uruguay".
Uruguay was first inhabited around 13,000 years ago by hunter-gatherers. It is estimated that at the time of the first contact with Europeans in the 16th century there were about 9,000 Charrúa and 6,000 Chaná and some Guaraní island settlements. There is an extensive archeological collection of man-made tumuli known as "Cerritos de Indios" in the eastern part of the country, some of them dating back to 5,000 years ago. Very little is known about the people who built them as they left no written record, but evidence has been found in place of pre-Columbian agriculture and of extinct pre-Columbian dogs. In 1831, its first Constitutional Government, instructed by the Act of Parliament, organised the capture of ethnic groups mainly charrúas that were violating with murder, robbery, and kidnapping of Uruguay's rural peoples. This included the minuanes and guaranis which have been at war with the charrúas for centuries. During the capture in Salsipuedes there were casualties of equivalent numbers on both sides. Ref: Lincoln Maiztegui Casas. Historia de los Orientales.
The Portuguese were the first Europeans to enter the region of present-day Uruguay in 1512. The Spanish arrived in present-day Uruguay in 1515 but were the first to set foot in the area, claiming it for the crown. The indigenous peoples' fierce resistance to conquest, combined with the absence of valuable resources, limited European settlement in the region during the 16th and 17th centuries. Uruguay then became a zone of contention between the Spanish and Portuguese empires. In 1603, the Spanish began to introduce cattle, which became a source of wealth in the region. The first permanent Spanish settlement was founded in 1624 at Soriano on the Río Negro. In 1669–71, the Portuguese built a fort at Colonia del Sacramento (Colônia do Sacramento).
Montevideo, the current capital of Uruguay, was founded by the Portuguese in the early 18th century as a military stronghold in the country. Its natural harbor soon developed into a commercial area competing with Río de la Plata's capital, Buenos Aires. Uruguay's early 19th-century history was shaped by ongoing fights for dominance in the Platine region, between British, Spanish, Portuguese and other colonial forces. In 1806 and 1807, the British army attempted to seize Buenos Aires and Montevideo as part of the Napoleonic Wars. Montevideo was occupied by British forces from February to September 1807.
In 1811, José Gervasio Artigas, who became Uruguay's national hero, launched a successful revolt against the Spanish authorities, defeating them on 18 May at the Battle of Las Piedras. In 1813, the new government in Buenos Aires convened a constituent assembly where Artigas emerged as a champion of federalism, demanding political and economic autonomy for each area, and for the Banda Oriental in particular. The assembly refused to seat the delegates from the Banda Oriental, however, and Buenos Aires pursued a system based on unitary centralism. As a result, Artigas broke with Buenos Aires and besieged Montevideo, taking the city in early 1815. Once the troops from Buenos Aires had withdrawn, the Banda Oriental appointed its first autonomous government. Artigas organized the Federal League under his protection, consisting of six provinces, five of which later became part of Argentina. In 1816, a force of 10,000 Portuguese troops invaded the Banda Oriental from Brazil; they took Montevideo in January 1817. After nearly four more years of struggle, the Portuguese Kingdom of Brazil annexed the Banda Oriental as a province under the name of "Cisplatina". The Brazilian Empire became independent of Portugal in 1822. In response to the annexation, the Thirty-Three Orientals, led by Juan Antonio Lavalleja, declared independence on 25 August 1825 supported by the United Provinces of the Río de la Plata (present-day Argentina). This led to the 500-day-long Cisplatine War. Neither side gained the upper hand and in 1828 the Treaty of Montevideo, fostered by the United Kingdom through the diplomatic efforts of Viscount John Ponsonby, gave birth to Uruguay as an independent state. 25 August is celebrated as Independence Day, a national holiday. The nation's first constitution was adopted on 18 July 1830.
At the time of independence, Uruguay had an estimated population of just under 75,000. The political scene in Uruguay became split between two parties: the conservative Blancos (Whites) headed by the second President Manuel Oribe, representing the agricultural interests of the countryside; and the liberal Colorados (Reds) led by the first President Fructuoso Rivera, representing the business interests of Montevideo. The Uruguayan parties received support from warring political factions in neighboring Argentina, which became involved in Uruguayan affairs.
The Colorados favored the exiled Argentine liberal Unitarios, many of whom had taken refuge in Montevideo while the Blanco president Manuel Oribe was a close friend of the Argentine ruler Manuel de Rosas. On 15 June 1838, an army led by the Colorado leader Rivera overthrew President Oribe, who fled to Argentina. Rivera declared war on Rosas in 1839. The conflict would last 13 years and become known as the Guerra Grande (the Great War). In 1843, an Argentine army overran Uruguay on Oribe's behalf but failed to take the capital. The siege of Montevideo, which began in February 1843, would last nine years. The besieged Uruguayans called on resident foreigners for help, which led to a French and an Italian legion being formed, the latter led by the exiled Giuseppe Garibaldi.
In 1845, Britain and France intervened against Rosas to restore commerce to normal levels in the region. Their efforts proved ineffective and, by 1849, tired of the war, both withdrew after signing a treaty favorable to Rosas. It appeared that Montevideo would finally fall when an uprising against Rosas, led by Justo José de Urquiza, governor of Argentina's Entre Ríos Province, began. The Brazilian intervention in May 1851 on behalf of the Colorados, combined with the uprising, changed the situation and Oribe was defeated. The siege of Montevideo was lifted and the Guerra Grande finally came to an end. Montevideo rewarded Brazil's support by signing treaties that confirmed Brazil's right to intervene in Uruguay's internal affairs. In accordance with the 1851 treaties, Brazil intervened militarily in Uruguay as often as it deemed necessary. In 1865, the Triple Alliance was formed by the emperor of Brazil, the president of Argentina, and the Colorado general Venancio Flores, the Uruguayan head of government whom they both had helped to gain power. The Triple Alliance declared war on the Paraguayan leader Francisco Solano López and the resulting Paraguayan War ended with the invasion of Paraguay and its defeat by the armies of the three countries. Montevideo, which was used as a supply station by the Brazilian navy, experienced a period of prosperity and relative calm during the war. The first railway line was assembled in Uruguay in 1867 with the opening of a branch consisting of a horse-drawn train. The present-day State Railways Administration of Uruguay maintains 2,900 km of extendable railway network. The constitutional government of General Lorenzo Batlle y Grau (1868–72) suppressed the Revolution of the Lances by the Blancos. After two years of struggle, a peace agreement was signed in 1872 that gave the Blancos a share in the emoluments and functions of government, through control of four of the departments of Uruguay.
This establishment of the policy of co-participation represented the search for a new formula of compromise, based on the coexistence of the party in power and the party in opposition. Despite this agreement, the Colorado rule was threatened by the failed Tricolor Revolution in 1875 and the Revolution of the Quebracho in 1886.
The Colorado effort to reduce Blancos to only three departments caused a Blanco uprising of 1897, which ended with the creation of 16 departments, of which the Blancos now had control over six. Blancos were given ⅓ of seats in Congress. This division of power lasted until President Jose Batlle y Ordonez instituted his political reforms which caused the last uprising by Blancos in 1904 that ended with the Battle of Masoller and the death of Blanco leader Aparicio Saravia.
Between 1875 and 1890, the military became the center of power. During this authoritarian period, the government took steps toward the organization of the country as a modern state, encouraging its economic and social transformation. Pressure groups (consisting mainly of businessmen, hacendados, and industrialists) were organized and had a strong influence on government. A transition period (1886–90) followed, during which politicians began recovering lost ground and some civilian participation in government occurred. After the Guerra Grande, there was a sharp rise in the number of immigrants, primarily from Italy and Spain. By 1879, the total population of the country was over 438,500. The economy reflected a steep upswing (if demonstrated graphically, above all other related economic determinants), in livestock raising and exports. Montevideo became a major economic center of the region and an entrepôt for goods from Argentina, Brazil and Paraguay.
The Colorado leader José Batlle y Ordóñez was elected president in 1903. The following year, the Blancos led a rural revolt and eight bloody months of fighting ensued before their leader, Aparicio Saravia, was killed in battle. Government forces emerged victorious, leading to the end of the co-participation politics that had begun in 1872. Batlle had two terms (1903–07 and 1911–15) during which, taking advantage of the nation's stability and growing economic prosperity, he instituted major reforms, such as a welfare program, government participation in many facets of the economy, and a plural executive. Gabriel Terra became president in March 1931. His inauguration coincided with the effects of the Great Depression, and the social climate became tense as a result of the lack of jobs. There were confrontations in which police and leftists died. In 1933, Terra organized a coup d'état, dissolving the General Assembly and governing by decree. A new constitution was promulgated in 1934, transferring powers to the president. In general, the Terra government weakened or neutralized economic nationalism and social reform. In 1938, general elections were held and Terra's brother-in-law, General Alfredo Baldomir, was elected president. Under pressure from organized labor and the National Party, Baldomir advocated free elections, freedom of the press, and a new constitution. Although Baldomir declared Uruguay neutral in 1939, British warships and the German ship Admiral Graf Spee fought a battle not far off Uruguay's coast. The Admiral Graf Spee took refuge in Montevideo, claiming sanctuary in a neutral port, but was later ordered out. In the late 1950s, partly because of a worldwide decrease in demand for Uruguayan agricultural products, Uruguayans suffered from a steep drop in their standard of living, which led to student militancy and labor unrest. An armed group of Marxist–Leninist urban guerrillas, known as the Tupamaros emerged in the 1960s, engaging in activities such as bank robbery, kidnapping and assassination, in addition to attempting an overthrow of the government.
President Jorge Pacheco declared a state of emergency in 1968, followed by a further suspension of civil liberties in 1972. In 1973, amid increasing economic and political turmoil, the armed forces, asked by President Juan María Bordaberry, disbanded Parliament and established a civilian-military regime. The CIA-backed campaign of political repression and state terror involving intelligence operations and assassination of opponents was called Operation Condor. The media was censored or banned, the trade union movement was destroyed and tons of books were burned after the banning of some writers' works. People on file as opponents of the regime were excluded from the civil service and from education. According to one source, around 180 Uruguayans are known to have been killed and disappeared, with thousands more illegally detained and tortured during the 12-year civil-military rule of 1973 to 1985. Most were killed in Argentina and other neighboring countries, with 36 of them having been killed in Uruguay. According to Edy Kaufman (cited by David Altman), Uruguay at the time had the highest per capita number of political prisoners in the world. "Kaufman, who spoke at the U. S. Congressional Hearings of 1976 on behalf of Amnesty International, estimated that one in every five Uruguayans went into exile, one in fifty were detained, and one in five hundred went to prison (most of them tortured). " Social spending was reduced and many state-owned companies were privatized. However, the economy did not improve and deteriorated after 1980, the GDP fell by 20% and unemployment rose to 17%. The state intervened by trying to bail out failing companies and banks.
A new constitution, drafted by the military, was rejected in a November 1980 referendum. Following the referendum, the armed forces announced a plan for the return to civilian rule, and national elections were held in 1984. Colorado Party leader Julio María Sanguinetti won the presidency and served from 1985 to 1990. The first Sanguinetti administration implemented economic reforms and consolidated democracy following the country's years under military rule. The National Party's Luis Alberto Lacalle won the 1989 presidential election and amnesty for human rights abusers was endorsed by referendum. Sanguinetti was then re-elected in 1994. Both presidents continued the economic structural reforms initiated after the reinstatement of democracy and other important reforms were aimed at improving the electoral system, social security, education, and public safety.
The 1999 national elections were held under a new electoral system established by a 1996 constitutional amendment. Colorado Party candidate Jorge Batlle, aided by the support of the National Party, defeated Broad Front candidate Tabaré Vázquez. The formal coalition ended in November 2002, when the Blancos withdrew their ministers from the cabinet, although the Blancos continued to support the Colorados on most issues. Low commodity prices and economic difficulties in Uruguay's main export markets (starting in Brazil with the devaluation of the real, then in Argentina in 2002), caused a severe recession; the economy contracted by 11%, unemployment climbed to 21%, and the percentage of Uruguayans in poverty rose to over 30%. In 2004, Uruguayans elected Tabaré Vázquez as president, while giving the Broad Front a majority in both houses of Parliament. Vázquez stuck to economic orthodoxy. As commodity prices soared and the economy recovered from the recession, he tripled foreign investment, cut poverty and unemployment, cut public debt from 79% of GDP to 60%, and kept inflation steady. In 2009, José Mujica, a former left-wing guerrilla leader (Tupamaros) who spent almost 15 years in prison during the country's military rule, emerged as the new president as the Broad Front won the election for a second time. Abortion was legalized in 2012, followed by same-sex marriage and cannabis in the following year. In 2014, Tabaré Vázquez was elected to a non-consecutive second presidential term, which began on 1 March 2015. In 2020, he was succeeded by Luis Alberto Lacalle Pou, a member of the conservative National Party, after 15 years of left-wing rule, as the 42nd President of Uruguay.
With 176,214 km2 (68,037 sq mi) of continental land and 142,199 km2 (54,903 sq mi) of jurisdictional water and small river islands, Uruguay is the second smallest sovereign nation in South America (after Suriname) and the third smallest territory (French Guiana is the smallest). The landscape features mostly rolling plains and low hill ranges (cuchillas) with a fertile coastal lowland. Uruguay has 660 km (410 mi) of coastline. A dense fluvial network covers the country, consisting of four river basins, or deltas: the Río de la Plata Basin, the Uruguay River, the Laguna Merín and the Río Negro. The major internal river is the Río Negro ('Black River'). Several lagoons are found along the Atlantic coast.
The highest point in the country is the Cerro Catedral, whose peak reaches 514 metres (1,686 ft) AMSL in the Sierra Carapé hill range. To the southwest is the Río de la Plata, the estuary of the Uruguay River (the river which forms the country's western border).
Montevideo is the southernmost capital city in the Americas, and the third most southerly in the world (only Canberra and Wellington are further south). Uruguay is the only country in South America situated entirely south of the Tropic of Capricorn, and is the southernmost sovereign state in the world when ordered by northernmost point of latitude.
There are ten national parks in Uruguay: Five in the wetland areas of the north, three in the central hill country, and one in the west along the Rio Uruguay.
Uruguay is home to the Uruguayan savanna terrestrial ecoregion. The country had a 2019 Forest Landscape Integrity Index mean score of 3.61/10, ranking it 147th globally out of 172 countries.
Located entirely within the southern temperate zone, Uruguay has a climate that is relatively mild and fairly uniform nationwide. According to the Köppen Climate Classification, most of the country has a humid subtropical climate (Cfa). Only in some spots of the Atlantic Coast and at the summit of the highest hills of the Cuchilla Grande the climate is oceanic (Cfb). The country experiences four seasons, with summer from December to March and winter from June to September. Seasonal variations are pronounced, but extremes in temperature are rare. Summers are tempered by winds off the Atlantic, and severe cold in winter is unknown. Although it never gets too cold, frosts occur every year during the winter months, and precipitation such as sleet and hail occur almost every winter, but snow is very rare; it does occur every couple of years at higher elevations, but almost always without accumulation. As would be expected with its abundance of water, high humidity and fog are common. The absence of mountains, which act as weather barriers, makes all locations vulnerable to high winds and rapid changes in weather as fronts or storms sweep across the country. These storms can be strong; they can bring squalls, hail, and sometimes even tornadoes. The country experiences extratropical cyclones but no tropical cyclones, due to the fact that the South Atlantic Ocean is rarely warm enough for their development. Both summer and winter weather may vary from day to day with the passing of storm fronts, where a hot northerly wind may occasionally be followed by a cold wind (pampero) from the Argentine Pampas. Even though both temperature and precipitation are quite uniform nationwide, there are considerable differences across the territory. The average annual temperature of the country is 17.5 °C (63.5 °F), ranging from 16 °C (61 °F) in the southeast to 19 °C (66 °F) in the northwest. Winter temperatures range from a daily average of 11 °C (52 °F) in the south to 14 °C (57 °F) in the north, while summer average daily temperatures range from 21 °C (70 °F) in the southeast to 25 °C (77 °F) in the northwest. The southeast is considerably cooler than the rest of the country, especially during spring, when the ocean with cold water after the winter cools down the temperature of the air and brings more humidity to that region. However, the south of the country receives less precipitation than the north. For example, Montevideo receives approximately 1,100 millimetres (43 in) of precipitation per year, while the city of Rivera in the northeast receives 1,600 millimetres (63 in). The heaviest precipitation occurs during the autumn months, although more frequent rainy spells occur in winter. But still the difference is not big enough to consider a dry or wet season, periods of drought or excessive rain can occur anytime during the year.
National extreme temperatures at sea level are, 44 °C (111 °F) in Paysandú city (20 January 1943) and Florida city (January 14, 2022), and −11.0 °C (12.2 °F) in Melo city (14 June 1967).
Uruguay is a representative democratic republic with a presidential system. The members of government are elected for a five-year term by a universal suffrage system. Uruguay is a unitary state: justice, education, health, security, foreign policy and defense are all administered nationwide. The Executive Power is exercised by the president and a cabinet of 13 ministers.
The legislative power is constituted by the General Assembly, composed of two chambers: the Chamber of Representatives, consisting of 99 members representing the 19 departments, elected for a five-year term based on proportional representation; and the Chamber of Senators, consisting of 31 members, 30 of whom are elected for a five-year term by proportional representation and the vice-president, who presides over the chamber. The judicial arm is exercised by the Supreme Court, the Bench and Judges nationwide. The members of the Supreme Court are elected by the General Assembly; the members of the Bench are selected by the Supreme Court with the consent of the Senate, and the Judges are directly assigned by the Supreme Court. Uruguay adopted its current constitution in 1967. Many of its provisions were suspended in 1973, but re-established in 1985. Drawing on Switzerland and its use of the initiative, the Uruguayan Constitution also allows citizens to repeal laws or to change the constitution by popular initiative, which culminates in a nationwide referendum. This method has been used several times over the past 15 years: to confirm a law renouncing prosecution of members of the military who violated human rights during the military regime (1973–1985); to stop privatization of public utility companies; to defend pensioners' incomes; and to protect water resources. For most of Uruguay's history, the Partido Colorado has been in government. However, in the 2004 Uruguayan general election, the Broad Front won an absolute majority in Parliamentary elections, and in 2009, José Mujica of the Broad Front defeated Luis Alberto Lacalle of the Blancos to win the presidency. In March 2020, Uruguay got a conservative government, meaning the end of 15 years of left-wing leadership under the Broad Front coalition. At the same time centre-right National Party’s Luis Lacalle Pou was sworn in as the new President of Uruguay. A 2010 Latinobarómetro poll found that, within Latin America, Uruguayans are among the most supportive of democracy and by far the most satisfied with the way democracy works in their country. Uruguay ranked 27th in the Freedom House "Freedom in the World" index. According to the V-Dem Democracy indices in 2023, Uruguay ranked 31st in the world on electoral democracy and 2nd behind Switzerland on citizen-initiated direct democracy. Uruguay shared 14th place along with Canada, Estonia and Iceland as least corrupt in the World Corruption Perceptions Index composed by Transparency International in 2022 beating out countries like the UK, Belgium and Japan.
Uruguay is divided into 19 departments whose local administrations replicate the division of the executive and legislative powers. Each department elects its own authorities through a universal suffrage system. The departmental executive authority resides in a superintendent and the legislative authority in a departmental board.
Argentina and Brazil are Uruguay's most important trading partners: Argentina accounted for 20% of total imports in 2009. Since bilateral relations with Argentina are considered a priority, Uruguay denies clearance to British naval vessels bound for the Falkland Islands, and prevents them from calling in at Uruguayan territories and ports for supplies and fuel. A rivalry between the port of Montevideo and the port of Buenos Aires, dating back to the times of the Spanish Empire, has been described as a "port war". Officials of both countries emphasized the need to end this rivalry in the name of regional integration in 2010. Construction of a controversial pulp paper mill in 2007, on the Uruguayan side of the Uruguay River, caused protests in Argentina over fears that it would pollute the environment and lead to diplomatic tensions between the two countries. The ensuing dispute remained a subject of controversy into 2010, particularly after ongoing reports of increased water contamination in the area were later proven to be from sewage discharge from the town of Gualeguaychú in Argentina. In November 2010, Uruguay and Argentina announced they had reached a final agreement for joint environmental monitoring of the pulp mill. Brazil and Uruguay have signed cooperation agreements on defence, science, technology, energy, river transportation and fishing, with the hope of accelerating political and economic integration between these two neighbouring countries. Uruguay has two uncontested boundary disputes with Brazil, over Isla Brasilera and the 235 km2 (91 sq mi) Invernada River region near Masoller. The two countries disagree on which tributary represents the legitimate source of the Quaraí/Cuareim River, which would define the border in the latter disputed section, according to the 1851 border treaty between the two countries. However, these border disputes have not prevented both countries from having friendly diplomatic relations and strong economic ties. So far, the disputed areas remain de facto under Brazilian control, with little to no actual effort by Uruguay to assert its claims.
Uruguay has enjoyed friendly relations with the United States since its transition back to democracy. Commercial ties between the two countries have expanded substantially in recent years, with the signing of a bilateral investment treaty in 2004 and a Trade and Investment Framework Agreement in January 2007. The United States and Uruguay have also cooperated on military matters, with both countries playing significant roles in the United Nations Stabilization Mission in Haiti. President Mujica backed Venezuela's bid to join Mercosur. Venezuela had a deal to sell Uruguay up to 40,000 barrels of oil a day under preferential terms. On 15 March 2011, Uruguay became the seventh South American nation to officially recognize a Palestinian state, although there was no specification for the Palestinian state's borders as part of the recognition. In statements, the Uruguayan government indicated its firm commitment to the Middle East peace process, but refused to specify borders "to avoid interfering in an issue that would require a bilateral agreement". In 2017, Uruguay signed the UN treaty on the Prohibition of Nuclear Weapons. In March 2020, Uruguay rejoined the Inter-American Treaty of Reciprocal Assistance (TIAR or "Rio Pact"). In September 2019, the previous left-wing government of Uruguay had withdrawn from TIAR as a response to the very critical view of Venezuela the other members of the regional defense agreement had.
The Uruguayan armed forces are constitutionally subordinate to the president, through the minister of defense. Armed forces personnel number about 14,000 for the Army, 6,000 for the Navy, and 3,000 for the Air Force. Enlistment is voluntary in peacetime, but the government has the authority to conscript in emergencies. Since May 2009, homosexuals have been allowed to serve in the military after the defense minister signed a decree stating that military recruitment policy would no longer discriminate on the basis of sexual orientation. In the fiscal year 2010, the United States provided Uruguay with $1.7 million in military assistance, including $1 million in Foreign Military Financing and $480,000 in International Military Education and Training. Uruguay ranks first in the world on a per capita basis for its contributions to the United Nations peacekeeping forces, with 2,513 soldiers and officers in 10 UN peacekeeping missions. As of February 2010, Uruguay had 1,136 military personnel deployed to Haiti in support of MINUSTAH and 1,360 deployed in support of MONUC in the Congo. In December 2010, Uruguayan Major General Gloodtdofsky, was appointed Chief Military Observer and head of the United Nations Military Observer Group in India and Pakistan.
In 1991, the country experienced an increase in strikes to obtain wage compensation to offset inflation and to oppose the privatizations desired by the government of Luis Alberto Lacalle. A general strike was called in 1992, and the privatization policy was widely rejected by referendum (71.6% against the privatization of telecommunications). In 1994 and 1995, Uruguay faced economic difficulties caused by the liberalization of foreign trade, which increased the trade deficit. The Montevideo Gas Company and the Pluma airline were turned over to the private sector, but the pace of privatization slowed down in 1996. Uruguay experienced a major economic and financial crisis between 1999 and 2002, principally a spillover effect from the economic problems of Argentina. The economy contracted by 11%, and unemployment climbed to 21%. Despite the severity of the trade shocks, Uruguay's financial indicators remained more stable than those of its neighbours, a reflection of its solid reputation among investors and its investment-grade sovereign bond rating, one of only two in South America. In 2004, the Batlle government signed a three-year $1.1 billion stand-by arrangement with the International Monetary Fund (IMF), committing the country to a substantial primary fiscal surplus, low inflation, considerable reductions in external debt, and several structural reforms designed to improve competitiveness and attract foreign investment. Uruguay terminated the agreement in 2006 following the early repayment of its debt but maintained a number of the policy commitments. Vázquez, who assumed the government in March 2005, created the Ministry of Social Development and sought to reduce the country's poverty rate with a $240 million National Plan to Address the Social Emergency (PANES), which provided a monthly conditional cash transfer of approximately $75 to over 100,000 households in extreme poverty. In exchange, those receiving the benefits were required to participate in community work, ensure that their children attended school daily, and had regular health check-ups. Following the 2001 Argentine credit default, prices in the Uruguayan economy made a variety of services, including information technology and architectural expertise, once too expensive in many foreign markets, exportable. The Frente Amplio government, while continuing payments on Uruguay's external debt, also undertook an emergency plan to attack the widespread problems of poverty and unemployment. The economy grew at an annual rate of 6.7% during the 2004–2008 period. Uruguay's exports markets have been diversified to reduce dependency on Argentina and Brazil. Poverty was reduced from 33% in 2002 to 21.7% in July 2008, while extreme poverty dropped from 3.3% to 1.7%. Between the years 2007 and 2009, Uruguay was the only country in the Americas that did not technically experience a recession (two consecutive downward quarters). Unemployment reached a record low of 5.4% in December 2010 before rising to 6.1% in January 2011. While unemployment is still at a low level, the IMF observed a rise in inflationary pressures, and Uruguay's GDP expanded by 10.4% for the first half of 2010. According to IMF estimates, Uruguay was likely to achieve growth in real GDP of between 8% and 8.5% in 2010, followed by 5% growth in 2011 and 4% in subsequent years. Gross public sector debt contracted in the second quarter of 2010, after five consecutive periods of sustained increase, reaching $21.885 billion US dollars, equivalent to 59.5% of the GDP. Uruguay was ranked 63rd in the Global Innovation Index in 2023. The growth, use, and sale of cannabis was legalized on 11 December 2013, making Uruguay the first country in the world to fully legalize marijuana. The law was voted on at the Uruguayan Senate on the same date with 16 votes to approve it and 13 against.
The number of union members has quadrupled since 2003, rising from 110,000 to more than 400,000 in 2015 for a working population of 1.5 million. According to the International Trade Union Confederation, Uruguay has become the most advanced country in the Americas in terms of respect for "fundamental labour rights, in particular the freedom of association, the right to collective bargaining and the right to strike. One of the effects of this high level of unionization was to reduce socio-economic inequalities.
In 2010, Uruguay's export-oriented agricultural sector contributed to 9.3% of the GDP and employed 13% of the workforce. Official statistics from Uruguay's Agriculture and Livestock Ministry indicate that meat and sheep farming in Uruguay occupies 59.6% of the land. The percentage further increases to 82.4% when cattle breeding is linked to other farm activities such as dairy, forage, and rotation with crops such as rice. According to FAOSTAT, Uruguay is one of the world's largest producers of soybeans (9th), wool (12th), horse meat (14th), beeswax (14th), and quinces (17th). Most farms (25,500 out of 39,120) are family-managed; beef and wool represent the main activities and main source of income for 65% of them, followed by vegetable farming at 12%, dairy farming at 11%, hogs at 2%, and poultry also at 2%. Beef is the main export commodity of the country, totaling over US$1 billion in 2006. In 2007, Uruguay had cattle herds totalling 12 million head, making it the country with the highest number of cattle per capita at 3.8. However, 54% is in the hands of 11% of farmers, who have a minimum of 500 head. At the other extreme, 38% of farmers exploit small lots and have herds averaging below one hundred head.