Best known for the austere lifestyle of its outgoing president, Jose Mujica, Uruguay is a small country of 3.3 million individuals nestled in between the two South American powerhouses of Brazil and Argentina.
Uruguay has been long dependent on foodstuff exports to fuel its economy. While this country is still reliant on exports of these products, growing & raising enough cattle, sheep, soy and other products to feed over 28 million people worldwide, Uruguay’s iconic gaucho might soon be replaced by the jeans clad entrepreneur.
Like many other South American countries, state-run industries dominate many sectors of the Uruguayan economy including utilities, whisky distilling, and marijuana. Even one of the country’s start-up incubators is government managed. Yet the country is one of the freest economies in South America, ranking fifth out of 29 countries in the region according to The Heritage Foundation.
Most remarkable about Uruguay is perhaps the lengths it goes towards attracting foreign talent. Foreign entrepreneurs are easily able to obtain residency visas, and even able to begin working in the country even before their visa has arrived. Business incubatorSoftLandings, founded in Montevideo as part of the Entrepreneurs Support Programme by the government’s National Investigation and Innovation Agency offers $40,000 to foreign entrepreneurs as well as mentoring, office space, and other support with few conditions attached.
Businesses can be incorporated in under a week with no minimum capital requirements. Moreover, while the government has a strong “cradle to grave” welfare system, taxes remain relatively low for entrepreneurs. Companies that have fewer than 99 employees, or annual sales of less than $5,000,000 and assets under $350,000 receive support and tax large breaks from the government via its DINAPYME (National Agency of Arts and Crafts and SMEs) scheme.
Uruguay also hosts the most affordable and one of the fastest connections to the internet in Latin America according to a Google-backed study.
While Uruguay is not on many radars today with regard to entrepreneurship, it might just become the next Latin American hotbed. The country’s first co-working space, Sinergia, opened just this year. Limited amounts of seed and venture capital funding have also found their way to the country as well, with well-known firms like NXTP Labs and Sequoia Capital recently invested in Uruguayan startups.
With a maturing ecosystem and the development of a more conducive environment for entrepreneurship, Uruguay is surely a market to keep an eye on.
Courtesy of Emerging Frontiers
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