Uruguay receives the largest investment in history with the installation of a large pulp mill | Economy

After a long wait, the Finnish company UPM confirmed on Tuesday that it will install a huge pulp mill in central Uruguay. Of a value of about 3,000 million dollars, it will be the largest investment received by the country of Latin America in its history. The Uruguayan government was awaiting the announcement with some concern: it had established its economic projections and some of its major projects on the basis of this important payment that will significantly affect its economy in the coming years: Economy estimates that in 2020, when the factory works will already be underway, Uruguay will increase by 2.6%, which will allow to flee again to the crisis of the region and to an anemic 2019, in which the country will progress slightly by 0.6%.

The plant, which will process two million tonnes of eucalyptus wood per year, will constitute a major renovation of Uruguay's infrastructure, many of which are obsolete and unsuited to the new export cycle of raw materials – mainly in China – which boosted the economy of the South American country. In the coming years. The Finnish company will pay for some of these infrastructures, such as the modernization of the port of Montevideo, and the Uruguayan State will finance others, such as the setting up of a rail network capable of linking the plant to the ports and to pbad other export products. .

The plant will also have a significant impact on employment: its mere construction will result in the creation of some 6,000 jobs and, still according to the government and UPM, once under construction in 2022, the plant will generate about 4,000 direct and 6,000 indirect jobs.

Concern for the environmental impact

However, UPM's installation not only contains the promise of a decisive impetus for the country's development, but it also fears a deterioration in the water quality of the Black River near the factory and the rest of the country's rivers. This is a picture of a green tide of cyanobacteria, a pollutant phenomenon to which the population had already made progress last summer, when a nearly fluorescent sticky point caused many beaches to close for several days.

Cyanobacterial invasions are caused by high temperatures and the strong presence of phosphorus in the water due to the use of chemicals in agriculture. Daniel Panario, doctor of environmental technology and water management and professor at the Faculty of Sciences of the University of the Republic, badumes that Uruguay is heading towards a future "green cyanobacteria".

"UPM adds to an existing problem. The most important impact concerns afforestation badociated with entrepreneurship. The planting of eucalyptus generates irreversible effects on the soils, studied all over the world. And this subtracting water from basins, rivers lose their ability to dilute and self-regenerate. If we reduce the flow of rivers, we will further complicate the situation of phosphorus contamination, "says Daniel Panario.

Warnings regarding the environmental cost of the pulp mill have had little echo. Uruguay already has two other plants of this type on its territory and, although in recent years the water quality in the nearby rivers has deteriorated, all agree that the main cause is agriculture rather than the transformation of cellulose.

The Uruguayan authorities acknowledge that the Rio Negro, which will receive UPM effluent, already has pollution levels higher than those allowed, but also promises to strengthen water controls. In this context, the presidential candidate of Frente Amplio (the coalition of left-wingers in power), Daniel Martínez, tried to moderate the official triumphalism by the arrival of investments in the middle of the year of elections. Martínez said that "there is still a lot to be done for this to be great news" for the country, evoking challenges such as environmental controls or the possibility of inserting the project into a value-added productive diversification. .

Since the opposition, the installation of UPM is considered a positive thing in the country, but criticism regarding the many concessions of the government to the Finnish society worsen and it is denounced that several aspects of the contract were negotiated in secret.