Quotes: MENA   Enter Symbol: NewsLetter: Search: advanced

Argentines drain banks of dollars  Join our daily free Newsletter

MENAFN - The Peninsula - 09/02/2014
No. of Ratings : 0
Add to Mixx!



(MENAFN - The Peninsula) Jorge Lischetti applied to purchase dollars from the government the day Argentina eased controls. He stashed the 300 he was allowed to buy in January in his Buenos Aires home and did the same on the first day of February



Argentines such as Lischetti, a legal adviser, are contributing to a drop in the country's international reserves by refusing to deposit the dollars they purchase in local banks. More than 12 years after Argentina restricted withdrawals and converted dollar savings into pesos amid an economic crisis that led to a 95bn default, 91 percent of those who qualify to buy foreign currency from the government are paying a 20 percent surcharge to keep the cash



"History in Argentina is scary enough to make you want to keep your money out of the bank," Lischetti, 24, said in an interview in the capital



Argentines have applied to buy and take home 215m since President Cristina Fernandez de Kirchner opened up dollar purchases on January 27, exacerbating a plunge in reserves already at a seven-year low. Argentina's 19 percent devaluation last month and the easing of currency controls reflect Fernandez's efforts to cool black market trading, where the peso is 36 percent cheaper than the official rate



The country's bond yields and the cost to insure its debt against default are near a four-month high on speculation she won't be able to stem the haemorrhaging of dollars. Reserves fell 35 percent to 27.8bn in the 12 months to February 3, according to the central bank



The tax agency has received 463,327 requests to buy foreign currency since the government allowed the wealthiest Argentines to purchase dollars for savings at the official exchange rate for the first time in 18 months. Of that total, 423,645 have chosen to pay a 20 percent tax to take the greenbacks in cash, according to data from Afip, the tax agency



"In a context of uncertainty such as this one, Argentines who have lived through hyperinflation and numerous mega-devaluations, they want to keep their dollars," said Belen Olaiz, an analyst at Buenos Aires research company abeceb.com. In the 2001 financial crisis, Argentina froze savings accounts to stop a run on bank deposits, a measure dubbed the "corralito". Early the next year, the government forced banks to convert dollar-denominated deposits into pesos, which slashed savings to a fourth of their value



Argentines have an estimated 160bn of undeclared funds held abroad or stashed at home, according to the government. The Federal Reserve estimated in a 2006 report that Argentina, which the CIA says is the world's 33rd-most populous nation, had at least 50bn in US cash - about one of every 9 then circulating abroad



While some Argentines hide their dollars to evade government scrutiny, others are contributing to the erosion of the country's reserves by spending abroad



Juan Pablo Las Heras, 32, a manager at an agriculture company, said he was buying 300 at a local branch of Madrid- based Banco Santander SA in downtown Buenos Aires to spend on a holiday abroad. He said he planned to deposit the money in his dollar account and withdraw it once on vacation

 


The Peninsula




  MENA News Headlines
 May 28 2015 - Ban Ki-Moon: Syrian People Losing HopeQatar News Agency
(MENAFN - QNA) UN Secretary General Ban Ki-moon said that Syrian people were losing hope after being targeted by "indiscriminate" shelling and aerial strikes, including the use of barrel bombs by ...

 May 28 2015 - Al Mahmoud Leaves Doha for NigeriaQatar News Agency
(MENAFN - QNA) HE Deputy Prime Minister and Minister of State for Cabinet Affairs Ahmed bin Abdullah Al Mahmoud left Doha on Thursday morning for Abuja, the capital of Nigeria, to represent the ...

 May 28 2015 - Saudi- Health Minister chairs Hajj Preparatory Committees MeetingSaudi Press Agency
(MENAFN - Saudi Press Agency) Minister of Health Engineer Khalid Al-Falih chaired the meeting of Hajj Preparatory Committees, in the presence of members of committees at the ministry's ...

 May 28 2015 - Saudi Ambassador to Egypt: Egypt and Kingdom, Pulse of Arab and Muslim World 2 CairoSaudi Press Agency
(MENAFN - Saudi Press Agency) In his review of the relations of economic cooperation between the Kingdom of Saudi Arabia and Egypt, Saudi Ambassador pointed out that the Saudi investments in Egypt ...

 May 28 2015 - Saudi Ambassador to Egypt: Egypt and Kingdom, Pulse of Arab and Muslim WorldSaudi Press Agency
(MENAFN - Saudi Press Agency) Saudi Ambassador to the Arab Republic of Egypt, the Kingdom's permanent representative to the Arab League and Dean of the Arab Diplomatic Corps Ahmed bin Abdulaziz ...

 May 28 2015 - UK PM Cameron backs Jordan's Prince Ali for FIFA presidency -spokesmanSaudi Press Agency
(MENAFN - Saudi Press Agency) Prime Minister David Cameron backed Jordan's Prince Ali bin Al-Hussein's candidacy to be the next president of world soccer's scandal-hit governing body FIFA, Reuters ...

 May 28 2015 - Riyadh places 2 Hezbollah leaders on 'terror list'The Journal Of Turkish Weekly
(MENAFN - The Journal Of Turkish Weekly) Saudi Arabia has placed two leaders of the Lebanese Hezbollah group on its official "terror list".The official SPA news agency reported that Hezbollah leaders ...

 May 28 2015 - Italy, Algeria back UN mediation for LibyaThe Journal Of Turkish Weekly
(MENAFN - The Journal Of Turkish Weekly) Italy and Algeria have reiterated their support for UN's special envoy for Libya Bernardino Leon and his efforts to help form a national unity government in ...

 May 28 2015 - Al-Azhar imam to meet French far-rightistThe Journal Of Turkish Weekly
(MENAFN - The Journal Of Turkish Weekly) Al-Azhar, the highest seat of Sunni Muslim learning, said Wednesday that Grand Imam Ahmed al-Tayeb has agreed to meet with leader of the French far-right ...

 May 28 2015 - Geneva: UN special envoy for Syria calls for cease-fireThe Journal Of Turkish Weekly
(MENAFN - The Journal Of Turkish Weekly) UN Special Envoy for Syria Staffan de Mistura has called for a "humanitarian cease-fire" to end the bloodshed in Syria.De Mistura met Wednesday with Iran's ...

more...


 






Google

 
 

Middle East North Africa - Financial Network

MENAFN News Market Data Countries Tools Section  
 

Middle East North Africa - Financial Network
Arabic MENAFN

Main News
News By Industry
News By Country

Islamic Finance News
Private Equity News

How-To Guides
Technology Section

Travel Section

Search News

Market Indices
Quotes & Charts

Global Indices
Arab Indices

Commodoties

Oil & Energy

Currencies Cross Rates
Currencies Updates
Currency Converter

USA Stocks
Arab Stocks
 

Algeria 
Bahrain 
Egypt 
Iraq
Jordan 
Kuwait 
Lebanon
Morocco 
Oman 
Palestine
Qatar 
Saudi Arabia 
Syria
Tunisia 
UAE 
Yemen

Weather
Economic Calendar
Financial Glossary


Financial Calculators

RSS Feeds [XML]

Corporate Monitor

Events

Real Estate
Submit Your Property

Arab Research
Buy a Research

Press Releases
Submit your PR

Join Newsletters


 
© 2014 menafn.com All Rights Reserved.  Terms of Service | Privacy Policy | Contact Us | Advertise | About MENAFN | Career Opportunities | Feedback | Help