Uruguay en democracia: treinta años de evolución económica (1985-2015)

After more than a decade of dictatorship (June-1973/Feb-1985), in March 1985 the new democratic government takes charge of the Uruguayan economy, which had suffered a deep crisis that bottomed out in 1982. From there the monetary, fiscal, wage policy was redefined, and entered with great hope in a new growth path. However, international and regional conditions greatly limited economic growth and macroeconomic stability, and comes to 1989 with GDP stagnation, high inflation and fiscal deficit. Under these conditions, since 1990 a new neoliberal government established a stabilization plan with exchange rate anchor, labor market flexibility and tried to achieve fiscal balance. The stabilization policies generated a strong currency appreciation, that combined with the Mercosur's creation and Argentinean convertibility policy and Brazil's "Plan Real" generated a high regional dependence. After Brazilian devaluation of January 1999, the Uruguayan economy began to shrink, and rushed to another deep crisis after Argentina abandoned convertibility in December 2001. These facts led to a bank run that lasted until August 2002, when a 3-day bank holiday and a change in the economic team managed to stop it, with tough measures: banks closures and deposit freeze. The living conditions of Uruguayans rapidly deteriorated, with high unemployment, sharp increase in poverty, which implied migration and different survival strategies. The economy began to grow in 2003, and in 2005 the left-wing party, for the first time in power, made structural reforms (tax, social security, health, labor market, etc.) and with favorable international conditions, the economic growth continued for more than a decade. At the same time, promoted social and labor market improvements, although in recent years appeared some macroeconomic imbalances, such as inflation above the target range and high fiscal deficit. Thus, in this paper we analyze the impact of different economic policies implemented and the results obtained in Uruguay, in the context of the changing international and regional situation.