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For the first half of last century Uruguay was Latin America's most outstanding example of stable government. A system of proportional representation ensured that all parties participated at all levels of administration.
In 1951 Uruguay's presidential system was abolished. Power was vested in a national council with nine members representing the country's various political parties. In 1966, after a referendum, the presidency was restored. In the 1970s the government was dissolved by presidential decree, and the army stepped in to put down violent urban guerrillas. A narrow plain stretches along the coast of Uruguay, except near Montevideo.
Inland, however, the countryside consists of rolling slopes which rise gently to hills whose maximum height is 200 m. Countless short streams flow to the Atlantic. Two hydroelectric plants have been built on the Rio Negro which flows through the country.
This combination of fertile soils and natural irrigation, combined with a temperate climate, has produced lush grasslands, with trees growing in the bottoms of the many valleys.
The temperature range is narrow: from an average of 10°C in winter to 23°C in summer. Rainfall is also spread evenly throughout the year, varying from an annual average of 98 cm in Montevideo to 126 cm in the north.
Although some 90% of Uruguay is suitable for agriculture, only about 12% is cultivated. The rest is used to pasture cattle and sheep, and the whole economy rests on the production of meat and wool.
Meat and meat products account for more than one-third of export earnings, hides and skins for about one-tenth and wool for about one-fifth.
The traditional market for Uruguay's meat products was Western Europe, particularly Britain. But Uruguay now has to look for new markets, because of tariffs imposed by the European Economic Community and British legislation to prevent foot-and-mouth disease. In the 1950s and 1960s world wool prices also fell because of competition from man-made fibers, so that both mainstays of the country's economy have been severely weakened. The problem has been aggravated because during its years of prosperity Uruguay greatly increased the scope - and cost - of its social services.
History of Uruguay
More than 90% of Uruguayans are descended from European immigrants. Between the 1840s and the 1930s nearly 700,000 Europeans arrived, most of them from Italy and Spain. The original Indian population was small, and fewer than 10% of Uruguayans are of mixed white and Indian descent.
Settled by the Spaniards in 1515, Uruguay was controlled by Portugal in the 17th century, and became part of the Spanish Empire in the 18th century.
Montevideo was permanently settled in 1726. The territory was annexed to Brazil in 1820. The Uruguayans fought for and won independence in 1828 and Uruguay was established as an independent buffer state between Brazil and Argentina. For decades afterwards the country suffered from internal strife and disputes with its neighbors.
Modern Uruguay is largely the creation of Jose Batlle y Ordonez, a journalist who became president in 1903. He set up the country's proportional representation system, and his reforms worked well until the bureaucracy became overloaded and Uruguay was confronted by economic troubles in the 1950s.