U ruguay is a small nation of 3.4 million people located on the Atlantic coast of South America. Uruguay has drawn increased congressional attention in recent years as a result of the country's controversial decisions to legalize cannabis and grant refugee status to six men who had been detained at the U.S. Naval Station at Guantanamo Bay, Cuba. Domestic Situation

President Tabaré Vázquez of the center-left Broad Front ( Frente Amplio ) coalition was inaugurated to a five-year term on March 1, 2015. Since taking power in 2005, the Broad Front has maintained market-oriented economic policies while gradually expanding social welfare programs, establishing a more progressive tax system, and implementing union-empowering labor reforms. The Broad Front also has enacted several far-reaching social policy reforms, some of which have been controversial domestically. Although President Vázquez sought to build on Uruguay's socioeconomic advancements with campaign pledges to improve the quality of the education system and create a Comprehensive National Care System to address the needs of infants, the disabled, and the elderly, he has spent much of his second term dealing with the country's deteriorating economic situation. The economy is expected to continue slowing in 2016, with 0.1% growth. The slowdown appears to be largely the result of external conditions, including declines in international prices for Uruguay's agricultural commodity exports and economic recessions in Argentina and Brazil, which are two of Uruguay's top trading partners as fellow members of the Common Market of the South (Mercosur) customs union. The economic deceleration has depressed revenue collection and contributed to growing fiscal deficits. The Vázquez Administration has taken steps to respond to these challenges. This discontent, combined with rising security concerns, has taken a toll on Vázquez's approval rating. U.S.-Uruguayan Relations

U.S.-Uruguayan relations are strong and have grown closer in recent years. Some analysts predicted that bilateral relations would deteriorate following the Broad Front's assumption of power, given ideological opposition to working with the United States by some sectors of the coalition. Trade and Investment

Commercial ties between the United States and Uruguay have grown considerably over the past decade. Bilateral trade declined by 13% between 2013 and 2015, however, largely as a result of the slowing Uruguayan economy. Foreign direct investment has increased substantially since the United States and Uruguay signed a bilateral investment treaty in 2005. The accumulated stock of U.S. foreign direct investment in Uruguay increased from $609 million in 2005 to $1.6 billion in 2015. The Uruguayan government also has supported the Obama Administration's efforts to close the detention center at the U.S. U.N. Security Council

In 2015, Uruguay won the support of the rest of Latin America and the Caribbean to secure one of the 10 non-permanent seats on the 15-member U.N. Security Council for the 2016-2017 term. Peacekeeping Operations

Reflecting the country's commitments to international law and peaceful dispute resolution, Uruguay is one of the largest per capita contributors of forces globally to U.N. peacekeeping missions. The United States has urged Uruguay to maintain its contributions to U.N. peacekeeping missions and has sought to strengthen Uruguay's peacekeeping capabilities. Over the past four years, the U.S. government has obligated $14.6 million in assistance for Uruguay through the Global Peace Operations Initiative, which aims to increase the international community's capacity to carry out U.N. peacekeeping missions (see Table 1 ). The National Defense Authorization Act for FY2014 ( P.L. 113-66 ) required the Secretary of Defense to determine that steps would be taken to "substantially mitigate the risk" that transferred individuals would engage in activities that threaten the United States, U.S. citizens, or U.S. interests. Thirty years after the end of the dictatorship and fifteen years after a major economic crisis, Uruguay once again stands out in Latin America for its strong democratic institutions and comparatively prosperous and egalitarian society. The center-left Broad Front coalition has benefitted politically from presiding over more than a decade of strong economic growth and improvements in living standards.
Uruguay is a small nation of 3.4 million people located on the Atlantic coast of South America between Brazil and Argentina. The country stands out in Latin America for its strong democratic institutions; high per capita income; and low levels of corruption, poverty, and inequality. As a result of its domestic success and commitment to international engagement, Uruguay plays a more influential role in regional and international affairs than its size might suggest.
Uruguay has drawn increased congressional attention in recent years as a result of several high-profile and controversial decisions. Some Members of Congress are tracking the implementation of Uruguay's cannabis-legalization measure as they consider the implications of marijuana-legalization initiatives in a growing number of U.S. states. Uruguay's decision to grant refugee status to six individuals who had been detained at the U.S. Naval Station at Guantanamo Bay, Cuba, in 2014 also has drawn congressional scrutiny. Some Members contend that the Obama Administration failed to ensure that the Uruguayan government would take steps to "substantially mitigate the risk" of the transferred individuals engaging in activities that threaten the United States as required by the National Defense Authorization Act for FY2014 (P.L. 113-66). The Administration disputes that assertion.
Domestic Situation
The center-left Broad Front (Frente Amplio) coalition has governed Uruguay since 2005, having won the presidency and legislative majorities in three consecutive elections. Since taking office, the coalition has pursued a social democratic policy mix that has combined market-oriented economic policies with progressive taxation, an expansion of the social welfare system, and union-empowering labor reforms. The Broad Front also has enacted several far-reaching social policy changes, legalizing abortion; expanding rights for lesbian, gay, bisexual, and transgender (LGBT) individuals; and legalizing and regulating Uruguay's marijuana market.
President Tabaré Vázquez, who began his second nonconsecutive five-year term in March 2015, has spent much of his time in office dealing with Uruguay's deteriorating economic situation. After nearly a decade of strong growth, the Uruguayan economy has slowed dramatically as a result of softening global commodity prices and economic turbulence in Argentina and Brazil—Uruguay's main trading partners and fellow members of the Mercosur customs union. This economic weakness has depressed tax collection and contributed to growing fiscal deficits but has not brought down Uruguay's persistently high inflation. Vázquez has sought to address these economic challenges by reducing expenditures, increasing taxes, holding down wage increases, and investing in infrastructure through public-private partnerships. As economic growth has continued to slow in 2016 to an estimated 0.1%, the Vázquez Administration's approval rating has fallen to 33% and its disapproval rating has risen to 45%.
U.S.-Uruguayan Relations
U.S.-Uruguayan relations have strengthened over the past decade despite initial expectations by some analysts that ties would deteriorate following the Broad Front's assumption of power. The United States and Uruguay signed a bilateral investment treaty in 2005 and a Trade and Investment Framework Agreement in 2007. In 2015, the stock of U.S. foreign direct investment in Uruguay reached $1.6 billion and bilateral merchandise trade amounted to $1.9 billion. The United States and Uruguay also collaborate on efforts to address international security concerns. Uruguay is serving alongside the United States on the U.N. Security Council for the 2016-2017 term and is one of the largest per capita contributors globally to U.N. peacekeeping missions. The United States has provided more than $14.6 million in assistance to Uruguay over the past four years to bolster the country's peacekeeping capabilities.