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More USD restrictions


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12 replies to this topic

#1
syngirl

syngirl
They are further tightening access to anyone attempting to buy USD the legal way. Now you are not allowed to purchase with cash, only vía bank transfer.

http://www.lanacion....ero-bancarizado

#2
davonz

davonz
This explains why the blue rate went from 5.96 to 6.10 today.

http://www.ambito.co...cados/dolar.asp

#3
Cordobese

Cordobese
Perhaps this is Cristinas plan to forever trap us in Argentina since few of us have bank accounts :)

#4
syngirl

syngirl
Yeah I don't know if it will affect people with tourist visas -- I mean, if they want people to keep coming here they need to keep some legal method of purchasing dollars open no? Or do they want tourists to accidently over purchase pesos and then be stuck with them forever because they can't re-exchange them before leaving the country?

For anyone with residency and running a business in the black, or even longterm tourist overstayers who are working a cash biz here, you're only going to be able to change your cash to foreign currency at the black market rate from now on. Hello, 8:1 exchange rates.... coming soon to a cueva near you....

#5
mcaffa

mcaffa
  • LocationWisconsin

syngirl said:

Or do they want tourists to accidently over purchase pesos and then be stuck with them forever because they can't re-exchange them before leaving the country?

Bingo. You hit the nail right on the head.
"Life can either be accepted or changed. If it is not accepted, it must  be changed. If it cannot be changed, then it must be accepted."

#6
Crema Americana

Crema Americana
  • LocationLoma Hermosa

syngirl said:

Or do they want tourists to accidently over purchase pesos and then be stuck with them forever because they can't re-exchange them before leaving the country?

That is precisely what they want.  I'm not sure if this was originally planned or just a happy consequence, but the government here doesn't care about tourists much at all.  :)

#7
KarlaBA

KarlaBA
While the USD restrictions do seem harsh to someone accustomed to living in a country without capital controls; the restrictions are totally normal for most countries that do have capital controls. And Argentina has had capital controls since the 2001 corralito. Actually the fact that there has been a quasi-official parallel currency (USD) operating in Argentina for 11 years during a period of capital controls has been highly unusual from a global perspective.

One of the big lessons that Latin American policy makers learned from the 1980's lost decade, the 1997 Asian crisis, the Russian default, and the 2001 debt crisis is that a country must have control of its own money supply. Therefore the country must not have parallel currencies operating along side the national currency.  For some very small countries with all export earnings in dollars (almost exclusively from oil) it is ok to have a parallel currency or even get rid of the national currency completely. However, for all other types of countries, it is of fundamental importance to have exclusive control of their own money supply.

When Argentina has control of its own money supply, then the country can start to make some real progress in terms of tax evasion, illicit earnings, wealth concentration, etc.

As for what the government thinks about tourists; it doesn't and nor should it.  This is not a country where tourism is a major industry, and it most likely will never be for reasons that are completely out of the government's control.

#8
Bradly

Bradly

KarlaBA said:

When Argentina has control of its own money supply, then the country can start to make some real progress in terms of tax evasion, illicit earnings, wealth concentration, etc.

As for what the government thinks about tourists; it doesn't and nor should it.  This is not a country where tourism is a major industry, and it most likely will never be for reasons that are completely out of the government's control.

None of this will work in the long-term, however. They may be able to stem capital flight for a little while, but it will ultimately choke off further investment. Lending has plunged since CFK was re-elected, which is why they're forcing private banks to lend.

There's no confidence in the peso. Inflation is rampant, and they've done nothing to resolve it. They keep expanding the monetary base. Printing money that nobody wants, and making it more worthless every month as a result.

As far as international tourism not being important here, that's incorrect. In total current dollars, more than $30 billion USD entered BCRA reserves from tourism. That's more than half of current USD reserves. In South America, it's only beat by Brazil.

#9
Bradly

Bradly
*that's > $30 billion from 2001-2010.

#10
trennod

trennod
  • LocationPalermo Chico

KarlaBA said:

One of the big lessons that Latin American policy makers learned from the 1980's lost decade, the 1997 Asian crisis, the Russian default, and the 2001 debt crisis is that a country must have control of its own money supply. .

But apart from Argentina only Cuba, Venezuela and Brazil (minor extent) have currency controls in Latin America.

KarlaBA said:

When Argentina has control of its own money supply, then the country can start to make some real progress in terms of tax evasion, illicit earnings, wealth concentration, etc.

Do you agree with the currency controls Karla?

Look I agree with you regarding tax evasion and illicit earnings. Not so sure how it will significantly impact on wealth concentration.

To be honest I actually dont mind so much the restrictions to the extent that you need to get the all clear from AFIP (ie to ensure you are paying your taxes etc), but it is a severe restrictions of freedom to ban the purchase of USD completely, as is the case at the moment (bar travel).

How this is going to improve the standards of living of Argentina? How are do you think they are going so far? Has it worked / is it working in Venezuela?




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