Uruguay's Dignified Struggle for Respect

HOW does a small South American country that has successfully recaptured its democratic tradition through a second peaceful transfer of presidential power get a little respect? Uruguay has been unable to find the formula. As President Luis Lacalle took office on March 1, he found an Argentina in near chaos and renewed hyperinflation, and Brazil anxiously awaiting the Collor de Mello surprises. President Lacalle would also propose an economic adjustment program to deal with a fiscal deficit running at 7 percent of GNP and a 90 percent inflation rate. Yet, no one seemed interested. If the Tuparmaro guerrillas came back or the Socialist mayor declared Montevideo an independent commune, the media or Washington would certainly take notice of Uruguay. But the Tupamaros, now a legal political party, are not interested in reliving the late 1960s and the 1970s, a period of violence, torture, and military dictatorship. The leftist coalition - Frente Amplio - that won in Montevideo has all it can handle getting the garbage collected in this sprawling city - home to one-half the country's 3 million people.

Uruguay's citizens, mostly of Spanish and Italian heritage, haven't pretended to greatness or power. But they point proudly to their high educational and cultural level and a civil political tradition that earned the country the sobriquet of the ``Switzerland of South America,'' until economic decline set in during the 1950s. The causes were many: the failure of economic elites to respond to change, inefficient state enterprises, a bloated bureaucracy, and the romantic idealism of Fidel Castro that captured the imagination of youth. The descent to dictatorship was slow, but it came with a fury.

The regime earned Uruguay the dubious distinction of having more political prisoners per capita than any nation on earth. Twelve years later, in 1985, the military turned a broken and battered country over to a civilian president. The Colorado government under Julio Mar'ia Sanguinetti restored human rights and international credibility and got the country moving again, at least for three years. As economic stagnation set in, the 1989 election became a tossup and a 47-year-old senator emerged as the first president in this century to be elected from the opposition Blanco Party.

Luis Alberto Lacalle wants to open Uruguay up to the world. Uruguay has signed generous bilateral investment treaties with Japan and West Germany, and will be sending a negotiation team to the US with a similar goal in the next few weeks. Mr. Lacalle intends to reform state enterprises, reduce the bureaucracies and sell off or at least bring private participation to the government-run airline and telephone companies. His economic team is young, bright, and internationally oriented. They follow the boss' lead when he says that ``the new name of nationalism is prosperity.''

Lacalle knows it won't be easy. He doesn't have a majority in Parliament. But he's worked hard for coalition support from the dominant party, the Colorados. Labor and other interests will resist change. But Lacalle is determined not to ``Menemize'' the process.

Where does the US come in? Lacalle knows an economic adjustment program will hurt Uruguay's poor. Therefore he went to the developed countries for $50 million for a safety net. The US said no. Hardly a reasonable response to a small country that has never failed to meet its debt payments and consistently supports US policy. To the US, East Europe is important. But a few dollars for Uruguay goes a long way politically, psychologically, and economically.

And what of the US business community? On a plane between Rio and New York, an American businessman told me his firm liked doing business in Uruguay where skilled technicians could be hired for $500 a month. LAC Minerals of Canada and a US company are exploring for gold at several sites in Uruguay. The beaches are beautiful. Uruguay's best mineral water, Salus, tastes better to this writer than Perrier.

Maybe it's time Washington and Wall Street took a better look at a South American neighbor that has struggled with dignity, without hubris, and in the face of a hostile international environment, to give its children a life and culture their parents took for granted. To succeed, Uruguay and its neighbors need more than disregard or myopic preoccupation with the remnants of the cold war in Central America that continues to be the signposts of US policy.

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