The European Union is an excellent region for doing business and has established itself as the major commercial player on the international scene. The European Union has achieved a strong position by acting together on the world stage with a single voice, rather than by having separate business strategies.
The European Union is an attractive market for doing business because:
Europe has become deeply integrated with the world markets. Thanks to the ease of transport and modern communications, it is now easier to produce, buy and sell goods around the world, giving European companies of all sizes the potential to trade outside Europe. European workers often provide their services in different countries within a multinational or through specific service contracts. As investors thrive in a stable, solid and predictable environment, they seek to eliminate investment barriers and protect investment.
Europe exports hundreds of millions of euros of goods, and imports hundreds of millions more:
Why does international trade and foreign investment matter so much to the European Union?
The success of the European Union is inextricably linked to the success of its trading partners, both in the developed world and in the developing world. For this reason, sustainable development is fundamental to its trade policy.
Political, economic and commercial relations between the European Union and Uruguay are governed by the Framework Co-operation Agreement concluded in 1992.
During the last years the economic relations with Uruguay have intensified. Despite the delicate international situation, capital flow and European direct investment in Uruguay have increased. Companies such as UPM (cellulose), Montes del Plata/StoraEnso (cellulose), KatoenNatie (logistics/port), LDC (agriculture), Sofitel (tourism), Bayer (pharmaceuticals), Banco Santander, BBVA, HSBC (banks), MoviStar (telecommunications), BASF (chemicals/logistics), ABENGOA-TEYMA (infrastructures), Hamburg Sud (logistics), Andritz (machinery), ENEL GREEN POWER (renewable energy), AkuoEnergy (renewable energy), BADER (tannery), AkzoNobel (paints), PEUGEOT (cars), among others, are active stakeholders of the Uruguayan economy. Their presence is evidence of the great growth potential for the economic relations of Uruguay with the European Union. The European Union is the most important investor in Uruguay. In 2015 the European flow of investment in Uruguay amounted to €1,375 million and European investment stock exceeded €11,000 million (source: Eurostat).
The European Union is Uruguay’s third biggest trade partner, with an 11% share of the export and a 17% share of its imports in 2015, putting it behind only China and Brazil. In 2016, the exchange of goods volume between the two blocs reached €3,300 million. The European Union exports to Uruguay are dominated by machinery and chemical products while imports are mainly agricultural products and raw materials.
The European Union is a key market for high quality Uruguayan meat and the destination of almost 20% of exports of this product, as Uruguay benefits from a specific high quality quota (Hilton quota: 6,300 tonnes), and it is one of the few countries in the world that has access to the EU high quality beef quota (Regulation EU 481/2012, 48,200 tonnes).
Service trade between the European Union and Uruguay, has also shown a strong economic growth during the last years, increasing from €800 million in 2010 to more than €1,400 million in 2015 (source: Eurostat).
In the context of regional integration, following the Framework Cooperation Agreement of 1995, the European Union and Mercosur began preparing an Interregional Association Agreement, which is currently under negotiation. The difficulty of this process, which was relaunched in 2010, reflects the significance of bringing the two regions together and creates the largest free-trade area in the world, with more than 750 million residents. The purpose of this agreement is to reach a free-trade agreement and to strengthen political dialogue and cooperation between the regions.
The European Union remains Mercosur’s main trade partner and the biggest investor in the region. In 2015, the trade in goods between the two blocs reached €84,785 millions (€43,181 millions of European Union exports to Mercosur and €41,603 million in imports). The trade in goods exceeded €35,300 millions in 2015 European investment flow in Mercosur exceeded €35,670 millions and the European investment stock in Mercosur exceeded €400 million in 2015 (source: Eurostat).
More information on the position of the European Union and Mercosur