Uguay is usually seen as a success within the Latin American context. An early modernization process, marked by welfare policies oriented to the urban population, and a long democratic tradition have built a relatively egalitarian society that has recently (2004–2019) experienced one of its longest and strongest periods of economic growth. During this period, public policies were extended, in both the industrial and technological areas (as well as the social sphere), aiming to promote investment and a socially inclusive growth process. However, inclusive economic growth was accompanied by little structural change, which limits the possibilities of following a sustained development path. In this context, Uruguay seems not to have escaped from the so-called middle-income trap. The analysis shows that part of the problem here is that policies have been oriented to boost competitiveness and build capabilities in a horizontal manner, rather than changing the underlying economic structure.