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Uruguay is facing a year that could be more complex than expected at economic level

Comunicados y boletines
25 June 2018
Uruguay is facing a year that could be more complex than expected at economic level

The changes experienced in the last few months at the international level, with an increase of geopolitical tensions, the resurgence of protectionist trade policies and, above all, the tightening of credit conditions, lead us to believe the year could be more difficult than initially anticipated.

In addition, we have a more complex regional context, due to the increased fragility of the Argentine economy and political uncertainty in Brazil.

At a conference within the annual cycle of lectures organized by SURA Asset Management Uruguay for clients and friends, held at Piso 40 Business Club at the World Trade Center, Economist Laura Raffo analyzed the impact of the international situation on the Uruguayan economy.  

She indicated that the increases in global trade and investment have resulted in a better pace of economic growth when considering previous years. However, the situation is uneven across the different sectors, which "leads to difficulties in generating employment by companies whose competitiveness has been affected". 

“Although we have bypassed stagnation, not all productive sectors grew and businesses and companies have lower expectations for 2018" she said. She added that consumers follow the same trend, so the Confidence Index remains at a moderate to pessimistic level. 

With regards to the increase in interest rates and to the expectation that there will be two or three additional increases during the year, Raffo noted that "this narrows the credit conditions for Uruguay, which needs to issue debt for funds".

She also pointed out that the region grows but it is frail and that there is economic uncertainty due to the October elections in Brazil, despite the fact that the country increased 1% its Gross Domestic Product (GDP) in 2017.  It is a similar case for Argentina, whose GDP grew 2.9% throughout the year. “They need to address pending issues, such as the fiscal deficit and inflation, and it will be difficult for them to go over 1% this year," she explained. 

The cycle of lectures of SURA Asset Management Uruguay toured several departments of the country last year, and they will go on the road again within the next few months. 
In addition to an economic analysis, in each installment the company presents savings and investment alternatives, through their Investment Funds and SURA Stockbrokers lines. These business lines target customers who prefer a customized portfolio. 
About SURA Asset Management
SURA Asset Management is a subsidiary company of GRUPO SURA expert in pensions, savings and investment funds. It is a Latin American organization with offices in Chile, Mexico, Colombia, Peru, El Salvador and Uruguay. As of June 2017, SURA Asset Management operates a total of USD 131.9 billion in assets under management for 19.1 million regional clients.
* Clients and AUM include AFP Protección in Colombia and AFP Crecer in El Salvador. Even though these companies are not under direct control, SURA AM holds relevant stake.
SURA Asset Management Uruguay handles different business lines, among which are: AFAP SURA, the second largest retirement fund manager based on the number of affiliates and funds managed in Uruguay; AFISA SURA, an investment funds management company with open, public offer funds authorized by the Central Bank of Uruguay; and SURA Stockbrokers, which provides investment solutions that are customized to meet individual financial needs and goals, providing access to a wide variety of investment instruments.