Uruguay sees deepwater port as regional master plan

MONTEVIDEO, Uruguay, Oct. 22 (UPI) -- Uruguayan President Jose Mujica is pushing the country's deepwater port project as a multibillion-dollar regional undertaking, built on Uruguayan soil, leased to neighboring countries and operated by their state enterprises or private business.

Original estimates for La Paloma port's development cited $1 billion in costs but that figure isn't realistic any more, industry sources and published data indicate.


Landlocked Bolivia and Paraguay are interested because La Paloma offers their exports a potentially cost-effective outlet. Regional trade giant Brazil sees Uruguay's entire port network, not just the deep water port, as a welcome alternative to its clogged ports.

Brazilian President Dilma Rousseff has got private business involved in removing bottlenecks for Brazilian exports. More important, Rousseff wants a greater role in Uruguay's port development.

Mujica says he wants regional cash invested in the project.

Mujica and Paraguayan President Horacio Cartes will meet in Montevideo Friday to explore ways of working together on a joint business development program, officials said.

The port development project has allowed Cartes to bury differences with Mujica over the country's suspension from Mercosur trade bloc after political turmoil that brought Cartes to power.


Paraguayan congress impeached former President Fernando Lugo over deaths in a riot last year and installed a caretaker government that then organized elections that won millionaire businessman Cartes the presidency.

Construction of the deepwater port was considered for a few years before it was set aside in response to the economic downturn. Mujica revived the plan when he took office in 2010, surprising economists who thought the former guerrilla fighter an unlikely pioneer of a daring capital-based project.

Mujica visited China in May and a Chinese participation on both port and railroad development in Uruguay is in the cards. Chinese President Xi Jinping promised greater investments. How much of that will go toward developing Uruguay's deep water port isn't clear yet.

A five-year plan for extensive collaboration in infrastructure, industry, automobile manufacture and telecommunications is already in place. In return for Chinese investments, Mujica has promised to act as a facilitator for building China's diplomatic and economic ties in Latin America.

Meanwhile, Brazil is increasing investments in Uruguayan ports and will likely play a major part in the deepwater port project.

Brazilian Minister of Development, Industry and External Market Fernando Pimentel said his country will support the Port of La Paloma because Brazil regarded it as "a strategic regional project" and one that could help lower Brazil's regional transportation costs dramatically.


Brazilian officials see La Paloma as a complementary facility to their existing deep water port in Rio Grande do Sul.

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