Falklands fishing companies provided Montevideo with steady business before Argentine naval vessels began blockading in-bound maritime traffic, preventing entry by vessels returning from or sailing to Falklands or flying the Falklands flag.
Montevideo is an important refueling point for shipping to and from the Falklands but Argentina's campaign against the South Atlantic territory has forced a change in logistics for both Falklanders and Britain.
Cash-strapped Britain this year outlined plans for a $400 million upgrade of an airport at St. Helena's Island, another British territory and former home in exile for defeated French emperor Napoleon Bonaparte.
A new long-haul airport on St. Helena would still be hours of flying time away from the Falkland Islands but will provide Britain a vital air link between South Africa and its South Atlantic territories.
Argentina invaded the Falklands in 1982 while under military rule but was beaten back by Britain in a 74-day war that led to about 1,000 civilian and military deaths. Argentina threw off its dictatorship in the crisis of defeat but revived claims on the Falklands, which it calls Malvinas.
Since the start of a British-led oil exploration program in the Falklands waters in 2009, Argentina has stepped up the campaign to brand the Falklands as a colonial anachronism and has won increasing support from its Latin American neighbors.
Argentine and Uruguayan officials said the support was widening and further maritime blockades could soon make more Latin American ports off limits to Falklands-bound shipping.
Argentine analysts have hinted President Cristina Fernandez de Kirchner can win a diplomatic victory over Britain. Britain's Conservative government, heir to Margaret Thatcher's triumphal conduct of the Falklands War, is also ratcheting up firm but subdued rhetoric in response to Argentina's fiery invective.
Uruguay this week said it would continue to bar the Falklands vessels but would allow most British ships. He also confused analysts by saying a blockade would violate the Falklanders' human rights.
Critics say the Uruguayan measures already abet Argentina's blockade and accuse Uruguay of being an accomplice to Argentine attempts at a blockade.
"We hold nothing against the U.K. but we have a lot in favor of Argentina," he said, explaining his support to Buenos Aires was consistent with "continental solidarity."
Uruguay allows British flagged vessels to dock in Montevideo "but we don't allow English Navy vessels heading for Malvinas to call in Montevideo and this is because of solidarity with Argentina," Uruguay President Jose Mujica said.
Last week the British Foreign Office summoned the Uruguayan ambassador in London over Mujica's measures against Falklands-flagged vessels.
Falkland Islands Fishing Companies Association said: "We are extremely disappointed with Uruguay's decision not to allow Falkland-flagged vessels entry into Montevideo. In doing so Uruguay serves to punish its own people as, without doubt, the effect on their economy due to this decision will be significant."