Foreign exchange restrictions began on December 3, 2001 after almost 10 years of free exchange.
The so-called currency controls began on October 28, 2011, after the victory in the elections. And continued until December 17, 2015 with the new government.
After four years of free exchange, following the PASO elections of August 11, 2019, restrictions on access to the exchange market are reestablished as of September 1, 2019.
These PASO elections caused a massive outflow of foreign currency from the country and forced the government at that time to impose the exchange restrictions that had been repealed as of December 17, 2015.
As of September 1, there is an obligation to enter and settle export collections in the foreign exchange market.
Purchases of foreign currency for savings or transfers to personal accounts abroad or family assistance were limited to USD 200 per month.
Financial loans from abroad must be entered and settled in order to be paid when due.
Brief chronology of exchange restrictions
The requirement of prior compliance with the BCRA is established to transfer profits and dividends.
The obligation of banks to monitor export shipping permits through the AFIP BCRA SECOEXPO website is reestablished.
Banks have also been able to track shipments of goods to the market via the SEPAIMPO website.
Later, in May 2020, something new appeared in the exchange order, which was to control the operations of securities, that is, those who made cash settlement or MEP dollar transactions will not be able to operate for 90 days in the exchange market. This measure was caused by the massive access to the MEP dollar and cash settlement, which widened the gap with the official dollar and financial dollars and therefore with the informal dollar.
Settlement with cash is buying bonds against pesos and transferring them abroad to have dollars abroad and the MEP dollar is buying bonds against pesos and selling them against dollars in a local account.
This control has resulted in many individuals and legal entities being unable to access the exchange market for a period of 90 days.
Almost a month later, on May 28, 2020, the first import restriction began, which imposed a quota for paying for imports taking into account the relationship between payments made since January 1, 2020.
Later, in September 2020, restrictions are imposed on movements in foreign currency accounts.
Financial debts with unrelated counterparties must be refinanced in the following proportion: up to 40% can be paid at maturity and 60% must be refinanced at two years average maturity. This caused many problems with creditors of both financial loans and Negotiable Obligations since it forced them to refinance 60% of payments abroad.
In October 2020, the SIMI must be submitted in the outgoing state to pay for imports of goods for advance, sight or deferred payments without local clearance.
At the beginning of 2021, it was established that the payment for certain luxury goods such as boats, airplanes and automobiles of a certain value must be paid within 365 days from the date of delivery to the market.
In 2021, the restriction on imports of capital goods will be relaxed in a few months
In 2022, it is established that control of SIMIs will be transferred to the BCRA. SIMIs are the prior permits that importers must manage with the AFIP before making purchases abroad.
There are three types of SIMI: categories A, B or C. This has caused a high percentage of importers to be unable to access the exchange market to pay for imports. With SIMIs B, payment must be made within 180 days of delivery to the market. As has happened with financial debts, in the case of imports of goods, a large part of imported goods had to be refinanced within 180 days, either financed by suppliers, foreign banks or local banks.
On June 27, with the BCRA reserves falling dramatically, another online control was implemented by the BCRA, which meant that a large part of importers could no longer access the exchange market, which triggered a surge in MEP financial dollars and cash settlements. Importers looked for a way to pay their suppliers and maintain their activities. The gap between the official dollar and the financial dollars exceeded 100%, a fact that coincided with the resignation of the Minister of Economy.
Other measures included the "soybean dollar" for grain producers, which was not very successful, and the advance of pre-financing of exports for 180 days for the country's large exporters to enter.
In summary, Since the exchange rate restrictions imposed in 2011, the country has stopped growing, never again had the growth rates recorded since the end of the crisis in 2002, despite the brief period of exchange freedom 2015/2019, the country's growth has been stagnant for 11 years.
The strong restrictions imposed on imports of goods and services, as well as on the entry and exit of capital, added to the obligation of exporters to enter foreign currency at an official dollar with a gap of 100% over financial dollars less withholdings, mean that the country's economic growth is strongly affected since the entire economy of the country and the productive processes require imports of goods.
The challenge remains, then, to normalize the exchange market with freedom to import and export at competitive prices, in a very difficult post-pandemic context, with Russia's war on Ukraine.
He is a certified public accountant from the University of Buenos Aires (UBA). He has a postgraduate degree in Finance from the Universidad Argentina de Empresas (UADE). Currently, he is Head of the Comex Technical Area at Banco Santander Argentina, since 1987. He also serves as Secretary of the Comex Commission at the Association of Argentine Banks (ABA), since 2011. He has been married for 34 years to Adriana Barsanti, and has three children aged 33, 31 and 26, all professionals.
