Argentina to tighten import controls to preserve dollars
FILE PHOTO: U.S. one hundred dollar notes are seen in this picture illustration February 7, 2011. REUTERS/Lee Jae-Won/File Photo
By Eliana Raszewski
BUENOS AIRES (Reuters) — Argentina will regulate import authorizations more closely in an effort to prevent fraud and preserve reserves of U.S. dollars, Economy Ministry sources said on Saturday.
The new system will include verification that the size of an importer’s request is consistent with its financial resources; requiring importers to designate only one bank account for foreign trade and more precise timing for importers’ purchases of hard currency from the central bank, the sources said.
The government will publish a detailed resolution in the coming days and it will take effect on Oct. 17.
«This is to bring order to the system and avoid irregularities,» said one of the sources familiar with the plan.
Given limited central bank reserves of U.S. dollars, the government wants to make sure that hard currency is used for approved imports that increase domestic output.
The reserves stand at $36.55 billion, the central bank reported Thursday.
In Argentina, the dollar is worth 88% more in Argentine pesos in alternative financial markets than under the official rate, which is used to pay for imports. This entices some importers to overcharge or duplicate authorization requests, said one of the sources.
«Given the gap, it is very tempting to access the dollar in the official market, which is why there are schemes to accumulate unnecessary inventory,» explained the official, who asked not to be identified. «Some importers improperly try to obtain as many goods as possible using the official dollar.»
The new system will also allow small and medium-sized companies to reduce the timeframe for import payments from 180 days to 60 days.