Argentina’s
money scenario keeps getting stranger and more unpredictable, quickly becoming
a major political football (or soccer ball, if you prefer). Concerned (some would
say panicky) about capital flight and its ability to pay the bills, the
government of president Cristina
Fernández de Kirchner is intensifying restrictions on foreign currency
purchases, but it’s made some serious missteps.
Given most Argentines’ difficulty in obtaining currency to
travel beyond their own borders, the biggest blunder was foreign minister Héctor Timerman’s
decision to hold his daughter’s three-day
wedding celebration at José Ignacio, an exclusive beach destination near
the high-powered Uruguayan resort of Punta del Este (pictured above), for 300
guests at a cost of US$1,000 per person. This spectacle of indulgence by a
government official, at a time when ordinary citizens can’t even use their ATM
cards outside Argentina, aroused widespread indignation; the next day, Timerman’s
daughter announced that the event would now take place in Buenos Aires.
The PR disaster for a government whose principles appeared
to be “Do as I say, not as I do” was undeniable. Still, it hasn’t even slowed
the meddlesome measures that, so far, have also required Argentines to prove sufficient
income to justify dollar purchases for overseas travel. The tax agency AFIP has also slapped
a 15 percent surcharge on credit card purchases on mail-order items that arrive from outside
Argentina.
So far, the effects of the “dollar clamp” on foreign visitors
has been limited, despite a surreptitious black market that I have described
elsewhere. On returning from Argentina and Uruguay, reader Greg Mayes of
Calgary has informed me that “your recent
blog article about Uruguayan reticence to accept Argentine pesos may understate
a broader case. Upon our return I went into our local currency exchange, with
whom we have a long relationship, and they will no longer accept Argentine
pesos for Canadian currency; neither will the banks. Consequently we are left
with a currency souvenir we don’t really want. You may want to check if our
local situation is a more general case and if so warn your blog readers to get
rid of their Argentine pesos before they leave the country.”
That’s good advice,
but not so simple as it sounds. You should try not to buy more pesos than you
need but, if you need to get rid of them on departure, that’s harder than it
used to be. The latest measure limits the purchase of pesos on arrival at Buenos
Aires’ Aeropuerto Internacional
Ministro Pistarini and closes
private exchange houses, supposedly to protect innocent foreigners from
scalping. Only the state-run Banco de la
Nación (whose ATM is the easiest option) will now operate at ports of
entry, while kiosks such as the one pictured above are now closed.
In theory, departing passengers can still change their
Argentine banknotes back into dollars or another currency, but in reality it’s
gotten more difficult. You will now have to go to the airport branch of Banco
de la Nación, stand in line, and show receipts to prove that you obtained your
pesos at the legal rate.
Meanwhile, across the river, my friend Manuel Pérez Bravo of
Montevideo’s Hotel Mediterráneo informs me
that Argentines are still circumventing the clamp over there: “[T]he majority
come with Argentine pesos and buy dollars here in Montevideo [pictured above and below] and then pay their
hotel bill. We still don’t know exactly how the Argentine government’s measures
will affect us, but we hope they will not cause us too much damage...”
Tango by the River
As announced, I will still give a digital slide lecture on Buenos Aires at Tango by the River in Sacramento, but it has been postponed until Friday, September 21st, at 6 p.m.
Limited to a maximum of 50 people, the event will also include tango performances; admission costs $10 at the door, or $8 in advance. I have spoken here several times before, and we always sell out, so plan in advance. Signed copies of my Moon Handbooks on Argentina, Buenos Aires, Chile and Patagonia will be available at discount prices.
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