Argentines’ latest weapon against currency controls? Shopping abroad

[Joe]

Argentines going abroad for shopping: http://blogs.ft.com/beyond-brics/2012/07/02/argentines-latest-weapon-against-currency-controls-shopping-abroad/#axzz1zTlW4ksH

And Buenos Aires is no longer the cheap city it was after Argentina’s default on nearly $100bn in 2001. A cup of coffee is as dear as in London, Paris or New York."

Does anyone really think the waiters in Argentine cafes make as much as the waiters in New York? So why are the prices so high in Baires?

 

[Crema Americana]

Prices are high because although labor is relatively cheap, products and machinery are expensive. If beans are expensive, so is the coffee.



I wonder if they'll try to close the credit card loophole somehow. Products have always been cheaper and of better quality in the US and Europe, and although the peso doesn't go as far as it did when it was 1:1, it's still a good deal to buy products overseas. My mother in law is planning a trip to Miami precisely to buy clothes. She'll most likely go to the beach as well, but her primary reason is shopping.

 

[mariano-BCN]

Eclair...that's a very rare logic of yours...so if products and machinery are expensive everything anywhere should be as outrageous expensive as in Argentina? Why is then Argentina so expensive according to you?
and then again: there are other countries more expensive, indeed, but nowhere is service so bad as in Argentina. The combination of bad service and high prices makes it undesirable.

 

[nicoenarg]

Prices are high because labor AND machinery here is expensive compared to most countries in the region. Also, taxes on companies (and individuals) are sky-high. Raising taxes on companies is ALWAYS a bad idea since its the consumer who suffers at the end. Companies are around to make profit, not be charities so if they have to pay more, so do we!

 

[Dublin2BuenosAires]

Wage inflation = price inflation. For manufacturing of equipment, processing of raw materials, service sector and everyone else involved in getting that cup of coffee on your table. I'm sure even the most simplistic view of the world should allow you to understand that?

As for the service, can't say I've noticed it being any better of worse in other countries in the region. Is there much of an art to getting a cup of coffee ? Place order, get coffee, drink coffee?

 

[trennod]

I would argue low productivity and high taxes dont help prices either.

I just cant justify spending about $4 aussie on a crappy coffee here anymore. Its shame coffee is expensive and average, cause I love ambience and cafe culture.

 

[davonz]

Eclair...that's a very rare logic of yours...so if products and machinery are expensive everything anywhere should be as outrageous expensive as in Argentina? Why is then Argentina so expensive according to you?

things are expensive here because:
Import taxes/duties put the price of everything up here, including machinery to make stuff/process food/transport goods etc. Argentina is not a high value manufacturing country, so most technology, manufacturing equipment has to be imported. Even the companies down south that make TV/Phones etc, dont manufacture, they assemble.

Because of above locally made crappy products can be charged at a higher prices, so expensive compared to other countries.

Productivity is low in arg, because employees are lazy and the unions are strong so lazy employees dont fear losing their jobs - have you not been to a supermarket here and one in a foreign country (even chile or colombia), they are slow at scanning products etc here, always lines here, they are always talking, they are always running around kissing each other...........

 

[davonz]

I just cant justify spending about $4 aussie on a crappy coffee here anymore. Its shame coffee is expensive and average, cause I love ambience and cafe culture.

If anything the prices for a crappy cup of coffee should be going down, as coffee beans are down 40% in the last year... but i dont think we will see any prices savings passed onto the end user..

http://online.wsj.com/article/SB10001424052702303561504577494772331679462.html

 

[YanquiGallego]

Its because they are pincha pelotas. How is it that the exact same products imported FROM Argentina cost less in Spain (for example) than they do in Buenos Aires? Business owners here are very proud and act like having a cup of coffee at their locale is the equivalent to tea at the Ritz and for this you must pay a dear price. They have a very odd way of justifying things sometimes based on location and ¨luxury¨ and ¨upscale¨ here mean different things. Nevermind that most of the cafes these days are rundown and have about as much ambience as the cafeteria of a nursing home.

 

[Mitch]

Prices are high because labor AND machinery here is expensive compared to most countries in the region. Also, taxes on companies (and individuals) are sky-high. Raising taxes on companies is ALWAYS a bad idea since its the consumer who suffers at the end. Companies are around to make profit, not be charities so if they have to pay more, so do we!

I don´t agree with your blanket statement that rasing taxes on companies is ALWAYS a bad idea. For example Cruise liners are mostly regsitered in foreign tax havens. Many of them use Miami as their real home port. They have acess to free coast guard services, pollute US air without penalty, and are serving not only Americans but people from all over the world. First off I don´t care if the consumer has to pay more. He should, not me, I don´t like going on cruises and many people who can´t afford them are subsidizing these companies. I think I understood your rational, but they should pay because not every one uses them equally. Your blanket statement would give Rolls Royce a free ride if they were paying under the norm, because we don´t want to have to have their consumers pay more.