Mill Dispute Continues

April 2007 | Risk Summary

Diplomatic tensions between Argentina and Uruguay continue over the construction of pulp mills on the river border separating the two countries. Argentine protestors blockaded bridges over Easter, preventing any cross-border access for tourists during the holiday. The Uruguayan government has already claimed it is losing considerable revenues in the tourism industry, but is continuing to support the building of the mill. We do not expect a swift resolution to the spat, even with the mediation of the Spanish crown. That said, the dispute is unlikely to pose a major risk to political stability, in our view.

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