The politics of currency exchange in Argentina have done a complete 180 in under a year. The exchange of Argentine pesos for dollars, reals or euros was once a simple process. Today, however, it requires the approval of the AFIP (Federal Administration of Public Revenue) and is only allowed for those traveling abroad. Thus, in Argentina, it is impossible to save in a currency other than the peso.
Moreover, Banks are now required to report the credit card charges of all of its clients, and all purchases made outside of Argentina are subject to a 15% surcharge. And funds transferred or deposited from abroad are automatically converted into pesos, a process that costs a minimum of US$60 and may take several days to complete.
The government has claimed that such macroeconomic policies are aimed at increasing revenues, reducing fraud, and “un-dolarizing” the local economy."
FT reported about these curbs here. I have blogged about the growing "protectionist" trend in Argentina that countries are complaining about. Is this an indication of that trend? Or is this an exercise of domestic, developmental priorities? is it a valid management of macro-economic policies related to foreign exchange or is their a international trade law element? Is there sufficient domestic policy space to undertake these measures or do international trade rules violated? Are any of the WTO Agreements violated? Does TRIMS come into the picture here?