Group Blog 1: Las Papeleras

Buenos Aires Travel Blog

 › entry 6 of 17 › view all entries

Written by: Divya Kalb, Nicole Tocci, & Rachel Benkeser

Uruguay may allow Metsa Botnia of Finland and ENCE Corporation of Spain, two large cellulose factories, to continue construction on the Uruguay River as long as environmental safety standards are met to maintain the health of the surrounding ecosystem.

Argentina and Uruguay are close allies whose seamless, center-left governments have both pushed towards economic integration. Thus, they are vital trading partners. However, as Argentina has experienced an economic boom in the past few years, Uruguay has been hit with economic hardship since 1998. Since then  the economy has shrunk by 15%, approximately 120,000 citizens have left the country, and at present, almost 30% of the nation lives in poverty. Also, unlike Argentina, Uruguay will restructure, not default, its debt. Recently, Uruguay´s GDP has increased from 12 to 20 %, and this is mainly because of private investments.Uruguay has been selecting its investments cautiously, says Danilo Astori, the country´s economic and finance minister, and it will only work with investors with clear and stable rules. Metsa Botnia and ENCE are large, internationally reputable firms, and their investments in Uruguay exceed US $1.7 billion. Additionally, with the creation of both cellulose plants, more investments in the pulp/paper industry will enter Uruguay. With the potential employment opportunities, there is now a real estate boom near the factories. All of this will greatly improve the economic situation in Uruguay (Red, White, and New).

Argentina has expressed disapproval of the construction for a variety of reasons and they have utilized a variety of measures to protest the cellulose plants. Many citizens have protested in Gualeguaychu by blocking bridges to
halt construction. Additionally, many Argentines have boycotted Uruguay´s famous beaches, and this has resulted in an enormous economic loss exceeding US $300 million. Argentina opposes the construction of both cellulose factories on the grounds that they are environment hazards and that Uruguay breached the Statute of the Uruguay River, which was signed by both nations in 1975 (Paper Chase).

First, Argentina has paper mills, and Argentines have not protest against their own mills. These mills are a source of employment for many citizens, and many mills, due to their age, are not environmentally sustainable. The
new mills in Uruguay will meet stricter environmental standards. Uruguay claims that both plants use Element Chlorine Free, or ECF, for bleaching wood. This chemical is the latest and best technology and is utilized by the EU and the US. This process is significantly better than the present methods employed by Argentina´s older cellulose factories (Plantas).

Second, the Statute of the Uruguay River has not been beached. The Statute, signed in 1975, states that both nations cannot act unilaterally and must conserve the river and prevent pollution (International Court of Justice).
Uruguay has been consulting with Argentina for over a decade regarding these factories. Also the World Bank has twice inspected the construction sites, and both factories continue to meet environmental safety standards. Uruguay has not made a unilateral decision and it notified and consulted with Argentina prior to the construction of both facilities (Arocena). Thus, the rules of the Statute have not been broken.

Also the intense rivalry between Argentina and Uruguay has and will always be fierce. It is not clear how much of the protest stems from a certain degree of jealousy by Argentina over the fact that Uruguay is the benefactor of such an enormous international investment (University Students, Adela).

However, Argentina presents a valid argument with regards to environmental safety. Both Argentina and Uruguay are nations rich in biodiversity, and in recent decades, both have become popular ecotravel destinations. To continue being viewed as ethical travel candidates, both governments must be committed to environmental protection and the well-being of the population. Both cellulose factories will produce almost 1.5 million tons of cellulose per year. In the process, if environment standards are lax, water pollution, acid rain, and disease will become symptoms of cellulose production on the Uruguay River. Thus, to continue the successful, symbiotic exchange between travelers and Uruguay, and to continue the economic success of Uruguay, the government
must reinforce programs to protect the environment (Ethical Traveler).

Hence, we believe that Uruguay has not beached the Statute, and as long as it maintains sustainable environmental safety standards, it can continue to build both cellulose factories for its economic empowerment.

Works Cited

"Argentina and Uruguay: Paper Chase". The Economist. 16 Mar 2006.

"Argentina Institutes Proceedings Against Uruguay and Requests the Court to
Indictate Provisional Measures." International Court of Justice Online.
19 May 2006.

Arocena, Felipe. Papeleras. Universidad del Salvador, Buenos Aires. 19 May

Adela (Last Name). Papeleras. Universidad del Salvador, Buenos Aires. 19 May

"Plantas de Celulosa en Uruguay- Preguntas Frecuentes." <
ifcext/lac.nsf/Content/Uruguay_PulpMills_FAQ_Spanish>. 19 May 2006.

University Students. Papeleras. Universidad del Salvador, Buenos Aires. 19
May 2006.

"Uruguay´s Election: Red, White, and New". The Economist. 28 Oct 2004.

"World´s Best Ethical Travel Destinations". Ethical Traveler Online.
< /destinations.php> 19 May 2006.

Join TravBuddy to leave comments, meet new friends and share travel tips!