Argentina on Sunday imposed foreign-exchange controls on exporters as it closed out a week of financial uncertainty that saw a sharp drop in the peso.
Exporters were ordered to seek permission from the Central Bank of Argentina before purchasing foreign currency, according to a decree published in the government gazette.
In other new measures, transferring money abroad now requires permission from the Argentine government and individuals seeking to buy US dollars now face a monthly limit of 10,000 greenbacks.
However, there are no restrictions on people withdrawing US dollars from their bank accounts — a practice known in Argentina as the “corralito,” applied in late 2001 and the spark for the worst economic and political crisis in Argentine history.
All these new measures are to be in place until Dec. 31.
Last month, markets were rattled when pro-business Argentine President Mauricio Macri suffered a huge loss in party primary elections, and his leftist opponent Alberto Fernandez emerged as the favorite for next month’s presidential elections.
The decree published on Sunday said that the currency measures were needed temporarily to “regulate more intensely the currency exchange regime and strengthen the normal functioning of the economy.”
Argentina has been in recession since last year, and is battling rising unemployment and one of the world’s highest inflation rates, running at more than 55 percent.
In a bid to calm market turbulence, Argentina last week asked the IMF to restructure its debt payments on a US$56 billion bail-out loan agreed last year.
The IMF said that it was studying the new measures taken by the Macri government.
“Staff will remain in close contact with the authorities in the period ahead and the Fund will continue to stand with Argentina during these challenging times,” the IMF said in a statement.
The Central Bank of Argentina bought US$300 million in pesos on Tuesday last week to try to calm markets, but the currency still depreciated by almost 2.5 percent.
The currency weakened by 20 percent in the week after the primaries, while the Buenos Aires stock exchange dropped by 30 percent.
Just less than two weeks ago, ratings agencies Fitch and S&P downgraded Argentina’s credit rating from “B” to “CCC” and “B-” respectively.
Fernandez romped to victory in what was essentially a de facto opinion poll, with 47 percent of the vote to Macri’s 32 percent.
Such a result in next month’s election would send Fernandez — who has been highly critical of the IMF loan — to the presidential palace without need for a run-off in November.
Polytronics Technology Corp (聚鼎科技) yesterday announced that it is buying Henkel AG’s thermal clad dielectric material (TCLAD) business division for US$26 million as the Taiwanese firm aims to improve its technology, product portfolio and revenue performance. Polytronics, headquartered in the Hsinchu Science Park (新竹科學園區), is a supplier of protection components and heat dissipation materials. The firm entered the metallic heat-dissipation substrate market in 2007 and developed a unique solventless production process. Its board of directors approved signing an agreement with Henkel to acquire the German chemical firm’s TCLAD division in the US. The purchase includes all assets and business interests, including equipment,
SIZE MATTERS: Medium-sized hotels that do not have the support of parent groups are more vulnerable and are forced to take action, a REPro Knight Frank researcher said About 50 hotels across Taiwan are seeking to exit the market as they succumb to the bleak business outlook amid international travel restrictions imposed to combat the COVID-19 pandemic. Yomi Hotel (優美飯店) on Minsheng E Road, Sec 1, in Taipei is seeking to transfer ownership with an asking price of NT$950 million (US$32.15 million) and a pledge for a lease contract that guarantees a 3 percent return. The budget hotel, with room rates that start from NT$1,400 per night, maintains normal operations, but has been struggling since March, when the government placed restrictions on inbound and outbound travel. Occupancy rates for hotels in
With the US dollar expected to weaken in the next 12 months due to near-zero interest rates, investors should consider purchasing US corporate bonds, Standard Chartered Bank Taiwan Ltd (渣打台灣銀行) said on Thursday. The bank said that the US Federal Reserve since last month has been buying bonds issued by US companies to curb default rates. The US dollar is forecast to be weaker against the pound, the euro and the yen, as well as the Canadian dollar, the Swedish krona and the Swiss franc, as the greenback lacks high investment returns after the Fed in March slashed the benchmark interest rate
A Bollywood actor’s face tattooed on his arm, Sandeep Bacche’s devotion shocks few in India where stars enjoy semi-divine status, but even there the hallowed silver screen might be losing its shine to streaming services and pandemic fears. “Whenever things get better and theaters begin operations, I will watch three movies a day for sure just as a way to celebrate,” said the Mumbai rickshaw driver, who is recovering from the virus himself. However, others might not join the party. With cinemas shut for months due to a COVID-19 lockdown, and little prospect they will reopen soon, frustrated Bollywood producers have turned to