Climate change, which is hitting Italy hard these days through heat waves and abnormal rainfall, doesn't even make discounts in South America. In recent months, if not years, the big theme is that of drought, especially in the southern part of the continent: first it was Argentina's turn to see its soy production halved from 2020 to today, while now it's Uruguay's turn, hit by a practically unprecedented water crisis. The small South American country, governed since March 2020 by the 49-year-old Luis Lacalle Pou, the first centre-right president after 15 years of the Mujica era, is in recent weeks facing the worst water crisis in 70 years. To the point that the government had to decree it state of emergency, also authorizing the introduction of salt water from the Rio de la Plata, the great river that flows into the Atlantic on the border with Argentina, into the water network.
Uruguay, the water crisis: even salt water in the pipes
The situation is especially critical in the metropolitan area of Montevideo, the capital, where over 2 million people live, half of the country's entire population. Last week, the main reservoir that serves the area dropped to just 2% of its capacity: from 67 million cubic meters of water at full capacity, it came to contain 1,1 million, equal to the consumption of 2 days in and around Montevideo. Rio de la Plata water certainly solves the problem of washing and cooking, but its salinity makes it borderline drinkable, due to the very high levels of chlorine and sodium, so much so that in recent weeks the purchase of mineral water in Uruguay has doubled, and the government has asked aid to Brazil, which provided 13 km of pipeline to extract water from another river as well. Lacalle Pou also granted exemption from water taxes and for the most needy families he decreed aid equivalent to two liters of water a day reimbursed by the state.
Uruguay water crisis: GDP also slows down
The issue is so delicate that former president Pepe Mujica himself admitted that he too bears a share of responsibility for what is happening: "We slept, we should have foreseen this emergency and faced it well before". However, this does not get his center-right successor out of trouble, who took office exactly at the time of the start of the Covid pandemic and had to deal not only with the health and – now – water crisis. To begin with, in 2020 Uruguay's GDP fell by 15%, suffering the consequences of the pandemic more than other countries: tourism collapsed by 54% and unemployment rose from 8 to 10%. Between 2021 and 2022, the country then recorded a recovery of a good part of that lost growth (although last year inflation nearly reached the record level of 10%), but according to the International Monetary Fund this year the Uruguayan GDP is expected to slow down to 2%.
Uruguay and Mercosur: the president argues over relations with China
And then Lacalle Pou finds himself increasingly uncomfortable inside the Mercosur, the common market of Latin America, of which the rotating presidency was recently assumed by the Brazilian leader Lula, who has ideas that are a little distant from those of other countries in the area, including Uruguay. Meanwhile, Lula is blatantly trying to rehabilitate the Venezuelan dictator Nicolas Maduro, irritating not only Lacalle Pou but also the Chilean president Gabriel Boric, who also belongs to the family of Latin American socialism. Furthermore, Lula wants to go to confrontation with the EU on trade agreements: after Brussels' tightening on green policies, he will send a counter-proposal in the coming weeks. Uruguay, on the other hand, would like Mercosul to position itself compactly in the relations with China, an increasingly important partner for all of South America: but Lula and the Argentine president Alberto Fernandez, who already have privileged relations with Beijing, have preferred not to address the issue in the last few meetings, to the point that Lacalle Pou has already been threatening for some time to proceed with bilateral agreements.
President Lacalle Pou and the challenge of geopolitical relations
However, these are not foreseen among the countries belonging to Mercosul, whose treaties bind the individual states to proceed jointly in trade relations, as is happening with the European Union. In particular, since 1995, Mercosul has provided for a common rate for importing products from outside South America. This is why Brazil, Argentina and Paraguay already warned Montevideo from taking the initiative last year, and Lacalle Pou responded by accusing neighboring countries of "protectionism": "We agree that an agreement should be reached jointly with Mercosul – he said recently – but what we cannot accept is immobilism”. In the meantime, the Uruguayan government has also sent a request for membership to the Transpacific Treaty, a free trade agreement that includes countries in America, Asia and Oceania, including Australia, Canada and Japan. After the Mujica era in which Uruguay had become a development model for all of South America, today the country has changed its tune and must face, in addition to the water crisis, also the complicated challenge of geopolitical relationships.
