In Uruguay, a lively debate on the future of leather industry is currently underway. On the one hand, Eduardo Rubio, a member of parliament, suggested that they should shut down tanneries in compliance with a protectionist policy, after JBS Zenda group announced a forthcoming layoff. On the other hand, journalist Pablo Carrasco, from El Observador daily newspaper, harshly replied. In his opinion, topics and issues put forth so far are just drawing general attention far away from the gist of the real problem: Uruguay is far too expensive. More specifically, as regards leather and its business, Carrasco stressed the fact that difficulties are not due to export prices, whose trend has been traditionally fluctuating: in fact, “they most increased in 2007 and 2013, whereas they used to go down in 2008, and they are still cheaper at present”. That is why El Observador suggested that we should reasonably expect a new recovery: some markets, such as luxury automotive, rely on a very exclusive and wealthy clientele, “who is not keen on plastic interiors in their Mercedes Benz car”. However, “finished product prices have been decreasing, but raw hides prices have been dropping proportionally as well”. Ultimately, pointed out Carrasco, fluctuating market is not the real problem: in fact, “if it were like that, Zenda would have left the country without further ado; conversely, their plan was to carry on with their manufacturing in Uruguay, up to the processing final stages, while importing leather from Brazil”. This is the gist of the matter then: “one cannot realistically create any added value in Uruguay”. Politicians should strive hard to help businesses reduce their costs in the country.
Uruguay says no to leather protectionism: “Limiting costs is our top priority”
