Montevideo is the capital and largest city of Uruguay.It is headquarters to most Uruguayan banks and other financial institutions, plus has the Montevideo Stock Exchange (with the Top 150 Index). Similarly, the city and its region has most of the industries in Uruguay, including Heavy manufacturing as well as High-tech. Some workers are attracted to Uruguay, mostly from lower-income countries in South America.Uruguay, including Montevideo, is also a major offshore financial centre, owing to greater financial and political stability in Uruguay than anywhere else on the continent except Argentina, plus more honest financial dealings than even Argentina and certainly elsewhere on the continent.
The country earned the reputation as 'the Switzerland of Latin America' because of its banking secrecy laws, political stability, High literacy rate and excellent welfare system of the past. However, this image of a secure financial haven is being undermined by the country's economic difficulties and the improving economies of its neighbors.Monetary unit is Uruguay peso.
Financial Background
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Over the last five years, the Government of Uruguay (GOU) has instituted several legislative and regulatory reforms in connection with the further consolidation of its anti-money laundering program.In December 2003, the Uruguayan Chamber of Representatives approved a bill designed to Limit bank secrecy and confidentiality. The bill is specifically intended to increase credit transparency by eliminating bank secrecy for information pertaining to personal loans, financial credits, mortgages, or similar obligations. The bill does not, however, lift bank secrecy for law enforcement investigations regarding money laundering or terrorist finance.
A series of Central Bank regulations require banks (including offshore), Currency Exchange houses, and stockbrokers to implement anti-money laundering policies, including the recording in internal databases transactions over $10,000, and the reporting of suspicious transactions to the UIAF. In addition, the insurance and reinsurance sector, stock market, and Currency Exchange houses must know and thoroughly identify their customers, and report suspicious financial transactions to UIAF. The insurance sectors maintain a registry of "relevant" transactions, such as payments of insurance premiums of $10,000 or more, while stock and investment fund administrators must maintain a registry of individuals and entities exchanging Currency or other valuables in amount greater than $10,000. Uruguay remains active in international anti-money laundering efforts. In addition to its membership in GAFISUD, Uruguay is also a member of the OAS Inter-American Drug Abuse Control Commission Experts Group to Control Money Laundering.
Uruguay's financial system is comprised of banks, financial houses, offshore banks and representative offices of foreign banks. All of the above types of institutions require the authorization to operate by Uruguay's Central Bank. It is important to notice that in the last decade, representative offices of foreign banks have sprung up as an inexpensive vehicle for foreign banks to channel business to their headquarters without the need to establish themselves locally.Uruguay's banking system is a solid one, characterized by lack of Exchange controls, transfer of funds restrictions or profit remittance limits,strict banking secrecy,an easy process for foreign nationals or companies to Open bank accounts,and the existence of a limited number of reputable institutions.
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