Montevideo, founded by the Spanish in 1726 as a military stronghold, soon took advantage of its natural harbor to become an important commercial center.

Claimed by Argentina but annexed by Brazil in 1821, Uruguay declared its independence four years later and secured its freedom in 1828 after a three-year struggle.

The administrations of President Jose Batlle in the early 20th century established widespread political, social, and economic reforms that established a statist tradition. A violent Marxist urban guerrilla movement named the Tupamaros, launched in the late 1960s, led Uruguay's president to cede control of the government to the military in 1973.

By yearend, the rebels had been crushed, but the military continued to expand its hold over the government. Civilian rule was not restored until 1985.

In 2004, the left-of-center Frente Amplio Coalition won national elections that effectively ended 170 years of political control previously held by the Colorado and Blanco parties.

Uruguay's political and labor conditions are among the freest on the continent.

Source: CIA World Fact Book

Population: 3,460,607 (July 2007 est.)

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Age structure: 0-14 years: 23% (male 403,745/female 390,623) 15-64 years: 63.8% (male 1,096,225/female 1,112,568) 65 years and over: 13.2% (male 184,303/female 273,143) (2007 est.)

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Median age: total: 32.9 years male: 31.5 years female: 34.4 years (2007 est.)

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Population growth rate: 0.504% (2007 est.)

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Birth rate: 14.41 births/1,000 population (2007 est.)

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Death rate: 9.16 deaths/1,000 population (2007 est.)

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Net migration rate: -0.21 migrant(s)/1,000 population (2007 est.)

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Sex ratio: at birth: 1.04 male(s)/female under 15 years: 1.034 male(s)/female 15-64 years: 0.985 male(s)/female 65 years and over: 0.675 male(s)/female total population: 0.948 male(s)/female (2007 est.)

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Infant mortality rate: total: 12.02 deaths/1,000 live births male: 13.49 deaths/1,000 live births female: 10.49 deaths/1,000 live births (2007 est.)

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Life expectancy at birth: total population: 75.93 years male: 72.68 years female: 79.3 years (2007 est.)

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Total fertility rate: 1.97 children born/woman (2007 est.)

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HIV/AIDS - adult prevalence rate: 0.3% (2001 est.)

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HIV/AIDS - people living with HIV/AIDS: 6,000 (2001 est.)

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HIV/AIDS - deaths: less than 500 (2003 est.)

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Nationality: noun: Uruguayan(s) adjective: Uruguayan

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Ethnic groups: white 88%, mestizo 8%, black 4%, Amerindian (practically nonexistent)

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Religions: Roman Catholic 66% (less than half of the adult population attends church regularly), Protestant 2%, Jewish 1%, nonprofessing or other 31%

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Languages: Spanish, Portunol, or Brazilero (Portuguese-Spanish mix on the Brazilian frontier)

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Literacy: definition: age 15 and over can read and write total population: 98% male: 97.6% female: 98.4% (2003 est.)

Uruguay's well-to-do economy is characterized by an export-oriented agricultural sector, a well-educated work force, and high levels of social spending. After averaging growth of 5% annually during 1996-98, in 1999-2002 the economy suffered a major downturn, stemming largely from the spillover effects of the economic problems of its large neighbors, Argentina and Brazil. For instance, in 2001-02 Argentina made massive withdrawals of dollars deposited in Uruguayan banks, which led to a plunge in the Uruguayan peso and a massive rise in unemployment. Total GDP in these four years dropped by nearly 20%, with 2002 the worst year due to the banking crisis. The unemployment rate rose to nearly 20% in 2002, inflation surged, and the burden of external debt doubled. Cooperation with the IMF helped stem the damage. A debt swap with private-sector creditors in 2003 extended the maturity dates on nearly half of Uruguay's then $11.3 billion of public debt and helped restore public confidence. The economy grew about 12% in 2004 as a result of high commodity prices for Uruguayan exports, a competitive peso, growth in the region, and low international interest rates, and it continued to grow nearly 7% annually in 2005 and 2006.

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GDP (purchasing power parity): $37.54 billion (2006 est.)

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GDP (official exchange rate): $14.5 billion (2006 est.)

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GDP - real growth rate: 7% (2006 est.)

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GDP - per capita (PPP): $10,900 (2006 est.)

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GDP - composition by sector: agriculture: 9.3% industry: 33.7% services: 57% (2006 est.)

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Labor force: 1.27 million (2006 est.)

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Labor force - by occupation: agriculture: 14% industry: 16% services: 70%

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Unemployment rate: 10.8% (2006 est.)

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Population below poverty line: 27.37% of households (2006)

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Household income or consumption by percentage share: lowest 10%: 3.7% highest 10%: 25.8% (1997)

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Distribution of family income - Gini index: 45.2 (2006)

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Inflation rate (consumer prices): 6.5% (2006 est.)

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Investment (gross fixed): 13.6% of GDP (2006 est.)

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Budget: revenues: $5.203 billion expenditures: $5.449 billion; including capital expenditures of $193 million (2006 est.)

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Public debt: 70.6% of GDP (2006 est.)

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Agriculture - products: rice, wheat, corn, barley; livestock; fish

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Industries: food processing, electrical machinery, transportation equipment, petroleum products, textiles, chemicals, beverages

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Industrial production growth rate: 12.6% (2006 est.)

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Electricity - production: 8.183 billion kWh (2004)

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Electricity - consumption: 9.939 billion kWh (2004)

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Electricity - exports: 19 million kWh (2004)

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Electricity - imports: 2.348 billion kWh (2004)

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Oil - production: 513.5 bbl/day (2004 est.)

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Oil - consumption: 38,100 bbl/day (2004 est.)

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Oil - exports: NA bbl/day

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Oil - imports: NA bbl/day

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Oil - proved reserves: 0 bbl

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Natural gas - production: 0 cu m (2004 est.)

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Natural gas - consumption: 120 million cu m (2004 est.)

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Natural gas - exports: 0 cu m (2004 est.)

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Natural gas - imports: 120 million cu m (2004 est.)

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Current account balance: -$600 million (2006 est.)

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Exports: $3.993 billion f.o.b. (2006 est.)

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Exports - commodities: meat, rice, leather products, wool, fish, dairy products

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Exports - partners: Brazil 14%, US 12.3%, Argentina 8.2%, China 6.1%, Germany 5%, Russia 5%, Mexico 4.3% (2006)

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Imports: $4.532 billion f.o.b. (2006 est.)

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Imports - commodities: machinery, chemicals, road vehicles, crude petroleum

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Imports - partners: Brazil 17.2%, Argentina 16.4%, US 8.9%, Paraguay 7.8%, China 7.5%, Venezuela 5.2%, Nigeria 4.8% (2006)

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Reserves of foreign exchange and gold: $5.518 billion (October 2006 est.)

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Debt - external: $11.4 billion (30 September 2006 est.)

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Economic aid - recipient: $NA

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Currency (code): Uruguayan peso (UYU)

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Exchange rates: Uruguayan pesos per US dollar - 24.048 (2006), 24.479 (2005), 28.704 (2004), 28.209 (2003), 21.257 (2002)

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Fiscal year: calendar year