Opportunities Exist for Chinese Enterprises to Invest in Uruguay’s Clean Energy Sector

By Ada Wang

The energy structure transition has become a big concern for many countries and regions in the world. Uruguay is one of the countries that have seen successes in transitioning its energy structure.

At the international symposium themed “China-Uruguay investment cooperation opportunity—focus on new energy and technology” held recently， clean energy has become a heated topic for the event attendees.

Promote Belt and Road cooperation

Fernando Lugris， Uruguays Ambassador to China， said that Uruguay attaches great importance to working with China， and especially the National Reform and Development Commission. Uruguay is the first Latin American country that was willing to join the Belt and Road Initiative. Now China and Uruguay are working together to promote the signing of an action plan for Belt and Road cooperation， aiming to create more investment opportunities for both sides.

“China and Uruguay have been working together effectively in green development， sustainable development and clean energy.” Lugris said that Uruguay attaches great importance to clean energy and is working to develop hydrogen energy. “It is hoped that both China and Uruguay will work more closely in hydrogen energy development and promote more Chinese enterprises to invest in Uruguays hydrogen energy sector.”

Alvaro Brugnini， Project Manager of the 21st century investment and export promotion Bureau of Uruguay， said that Uruguay has an open and sound business environment， including astable political economy and favorable taxation policies. “Considering its geographical position， Uruguay could become an entry point for Chinese businesses to enter the Latin American market. It is also an ideal place for the implementation of the Belt and Road Initiative in Latin America.”

China-Uruguay cooperation has made new progress. SINOMACH China Machinery Engineering Co.， Ltd. successfully signed the EPC general contracting contract for Uruguays 500kV power transmission and transformation ring network closed project with Uruguay national power corporation. This is one of the largest infrastructure projects of Chinese enterprises in Uruguay and also the first large-scale EPC project under the framework of Belt and Road Initiative. It has great significance to the development of China-Uruguay strategic partnership.

Zhang Jianhua， Deputy Director of Foreign Capital Department of Chinas National Reform and Development Commission， said， “considering the economic scale and business cooperation of both countries， there is still great potential for Chinese businesses to invest in Uruguay. Chinese enterprises have strong capital and technology strength in infrastructure， power generation， tele-communication， new energy and e-commerce. It is hoped that Uruguay will create a more open， fair and friendly environment for Chinese enterprises. Both sides shall work more closely to promote bilateral investment cooperation to a higher level.”

Uruguay ranks second in the world in terms of clean power generation

According to Sao Xiaoyi， Director of Asia of MM&A Consultants， because Uruguay borders the southern part of Brazil and eastern side of Argentina， and has a population of 3.5 million people （smaller than Haidian District of Beijing）， it could become a place for foreign enterprises to make pilot experiment， before they expand their businesses to Latin America and other markets.

Sang Xiaoyi said that Uruguay ranks second in the world in terms of clean energy production； the three main sources of power generation include： wind， solar and hydropower.

Now about 63% of energy used in Uruguays power generation， transportation and heating supply is renewable energy. “Uruguay has entered the new phase of energy structure transition. The national power system has almost achieved de-carbonization. The new focus of energy development will be hydrogen power，” said Sang Xiaoyi.

He Zhenwei， Secretary-General of China Overseas Development Association， said that China has proposed the achievement of carbon peak by 2030 and carbon neutralization by 2060. There is large cooperation space for both countries in clean energy.

Diego Martinez， Executive Director of MM&A Consultants， said that in the past decade， MM&A Consultants has helped many Chinese companies to invest in Latin American regions， including Uruguay， Argentina， Brazil， Peru， Colombia， Mexico， Paraguay and Miami.

During the symposium， MM&A Consultants and China Overseas Development Association signed memorandum of cooperation. Diego Martinez hoped that in the future MM&A Consultants will provide more efficient services for Chinese businesses in Latin America and achieve further accomplishments through cooperation.