Economy

Argentina's economy operates under 12 different exchange rates

Restrictions and taxes have created a different rate for each segment of the economy.

Pesos, the currency of Argentina. Photo: Shutterstock.
  • There are specific rates for the export of soyabeans, meat, wines, corn and for different transactions;
  • In order to circumvent restrictions, individuals and companies resort to different types of operations and new exchange rates emerge.

Brazilian newspaper Valor Econômico ran an article on the “currency hell” experienced by Argentina. The country’s economy operates in a confused market, with an astonishing 12 exchange rates, after four years of relative normalcy. Now, restrictions and taxes have created a different rate for each segment of the economy.

In addition to the official, commercial and parallel exchange rates, there are alternative ones under tags such as “financial markets”, “settlements”, “cambio nación”, “solidarity or tourism”, “solidarity with forgiveness”, “soyabean”, “corn”, “meat” and “wine”.

READ ALSO: Uber makes a surprise return to Colombia

“With so many types of exchange, it is difficult to have an economic calculation, because we have a rate for the inflow of capital and a different one for outgoing capital”, complained to the paper the director of the Institute of Economic Studies and International Negotiations of the Rural Society of Argentina, Ezequiel de Freijó.

This dysfunctional situation is recurrent in the country’s history, but during the previous government of Mauricio Macri the rates had a period of market sanity. Now, in order to circumvent new restrictions, individuals and companies resort to different types of operations and therefore new exchange rates emerge.

A few of them are the “soybean dollar” and the “corn dollar”, applied to sales of the cereals, in addition to wheat and sunflower; the “meat dollar” is used to export all types of meat, powdered milk, rice, peanuts and wool; and, the “wine dollar” for the alcoholic beverage, fruits, sugar and infusions, among many others.