- The Washington Times - Saturday, April 15, 2006

FRAY BENTOS, Uruguay — President Tabare Vazquez is bucking the leftist, anti-American populism that he and other Latin American leaders have championed by seeking closer economic ties with the United States.

Officials from Uruguay met their counterparts in Washington last week in an effort to jump-start a stalled trade dialogue.

Mr. Vazquez also stood out among other Latin American leaders at the recent Summit of the Americas by signing a mutual investment treaty with the United States while others stood strong against the U.S.-backed Free Trade Area of the Americas.

The Vazquez government has rejected pressure from the populist base that elected him president by refusing to nationalize industries and continuing to support the privatization of some water and sanitation services.

The signals from Mr. Vazquez remain mixed. At times he leans toward backing the Mercosur trade bloc of some Latin American countries, which excludes the United States.

Nevertheless, many analysts compare his policies with those of Chile, which blends market-based policies with strong social-welfare spending.

“After one year in government, things have not been as dramatic as some were expecting,” said Nestor Gandelman, an economics professor at Uruguay’s ORT University.

In October 2004 elections, Mr. Vazquez led the socialist Broad Front, which won just over 50 percent of the vote. It was the left’s first national victory in 180 years.

Upon taking office in March 2005, Mr. Vazquez showed his leftist colors, restoring diplomatic ties with Cuba, signing energy deals with Venezuela and pushing for investigations into crimes committed by officials during military repression of the 1970s.

He made gestures to the poor, implementing a $100 million emergency social plan, and put leftist constituents, especially labor leaders, in key administrative posts.

In the past year, Mr. Vazquez’s push to secure economic links with Washington has miffed his party’s more radical elements, including Tupamaro guerrillas who fought the Uruguayan government in the 1960s and ‘70s.

Alejandro Garofali, a former diplomatic officer with the Uruguayan Ministry of Foreign Affairs, said Mr. Vazquez has taken a “clear, pragmatic approach to opportunities in market access and investment attraction.”

Mr. Garofali, who also served in the Uruguayan Embassy in Washington as an economic liaison to the White House, said Mr. Vazquez’s approach is evidenced by the U.S.-Uruguay Bilateral Investment Treaty that was signed at the Americas Summit in November.

Caesar Martinez, an analyst for Stratfor, a U.S.-based risk consulting group, said that Mr. Vazquez “is leftist in rhetoric but not in practice. He has kept government in the center.”

Mr. Vazquez has presided over brisk economic growth, fueled by rising commodity prices and foreign investment, which have helped fund increases in social-welfare spending.

Uruguay’s Economy Minister Danilo Astori recently told a weekly Uruguayan magazine that the government hopes to secure free trade agreements with both the United States and China this year.

He called such agreements “the paths to reaching the Uruguayan left’s most important objective, which is to create more jobs for the people.”

“A free trade agreement with the United States not only boosts potential investment possibilities, it also can generate notable increases in the level of job activity,” he said.

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