Viana considers there is a “violation of public order”. “Investment agreements are giving our sovereignty away”, said Viana according to Radio Uruguay. “We are eliminating articles that define us as a country, as a republic. I think that is giving away our sovereignty”, he added.

Montes del Plata is a consortium made up by forestry companies Arauco from Chile and Stora Enso from Sweden-Finland. In January, the company signed an investment agreement with the Uruguayan government to install a cellulose plant in Conchillas, which is already under construction. The total investment amounts to 1.9 billion dollars, the largest private investment in the history of the country. The new plant would begin its operations in the first three months of 2013.

The wood to be used as raw material for the new industry will come from tree plantations owned by Montes del Plata itself in nine departments of the country. The consortium between Stora Enso and Arauco is the largest owner of lands in Uruguay, with over 250,000 hectares.

On May 12, Uruguayan newspaper Búsqueda disclosed a fragment of the investment agreement signed between the Uruguayan government led by José Mujica, and Montes del Plata. The agreement, which has a confidentiality clause that Viana requested several times to be removed, implies several benefits for the company.

This fragment establishes the possibility to expand the tax-free zone where Montes del Plata will operate. Also, the Uruguayan Executive promised to authorize the company to have a percentage of foreign employees higher than that established by the Tax-Free Zones Law, which is 25%.

The agreement also establishes that “if there were any significant changes in the tax regime or in terms of authorizations that affect the economic conditions of Montes del Plata in a negative way, the government and the company will revise the special benefits that are granted in the framework of the investments law to compensate potential damages.”

Photo: http://www.uruguayaldia.com