The emergency bill that Alberto Fernández’s government sent to Congress this week would add a new type of dollar to the five already existing in the local market. What is already beginning to be called “tourist dollar” with a 30% tax on purchases abroad and payments of services to foreign companies, will also cover individual purchases in banks and exchange agencies with a limit of $ 200 per month. The other five types are: official retail dollar, wholesale dollar, free dollar (black market), MEP dollar or stock exchange, and dollar cash with clearance.
Gross Domestic Product (GDP) fell 1.7% in the third quarter of the year compared to the same period of 2018, the National Institute of Statistics and Census (INDEC) reported. The most affected sectors were industrial production, construction and commerce.
A group of around 80 of Argentina’s bond holders have formally set up a creditor group, committed to conducting talks with the new government “under G20-endorsed Principles for Stable Capital Flows and Fair Debt Restructuring”, according to a statement. The group said it had designated UBS Securities and Mens Sana Advisors as financial advisors and did not specify a lead creditor.
Argentina’s country risk fell 118 basis points to 1,996 (7.5%) according to the JP Morgan Plus 11EMJ emerging market bond index on Tuesday afternoon, while the price of over-the-counter government bonds increased 1.7%. Market analysts attributed the good behaviour in the Argentine public debt securities to the favourable reception that was given to Economy Minister Martín Guzmán’s economic proposals sent to the Congress.
Argentina’s government is seeking higher taxes on agricultural exports and to tax foreign assets held abroad, the Economy Minister Martin Guzman said to the press. The government wants to raise export taxes on wheat and corn to 15% from 12%. The bill would also raise the tariff cap on soybean exports to 33% from 30%. It also seeks to tax financial assets abroad. The purchase of foreign currencies would be taxed by 30%.
Argentina will join China’s multibillion-dollar Belt and Road Initiative (BRI), according to foreign office sources. Alberto Fernández would have expressed that intention to Arken Imirbaki, the envoy of Beijing to the presidential oath. In the meeting they also talked about the construction of a nuclear power plant with technology and Chinese capitals.