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Traveling to Argentina has become even more enticing with the Argentine government which has just launched a new tourist exchange rate, which effectively doubles your money when shopping. Since last Friday, tourists who do not live in Argentina or who do not have an Argentinian credit or debit card will be able to access a rate similar to the exchange rate of the “Dolar MEP” (Mercado Electrónico de Pagos), which is almost equivalent at the illegal “Dolar Blue” rate which tourists usually access in cash.
Gone are the days of asking your local friends to trade a big wad of cash for you, or meeting some sketchy character in an alley to do it for you. Now you can do it yourself, simply by making the purchase with your credit card.
Last week, the MEP Dolar rate was around 292 pesos to the dollar, while the official rate was 158 pesos to the dollar. Interchanging at the MEP rate gets you almost double pesos for your dollar as opposed to the official rate applied to overseas payment methods.
“In effect, the measure introduces an exchange rate 90% above the official rate applying to all tourism expenditure in the country, including excursions, meals and tourist packages,” wrote Buenos Aires weather.
How did the exchange rate work before?
If a tourist paid for an expense with a credit or debit card, the cost of it would be converted at the official exchange rate, which was used by banks.
The The Buenos Aires Times explains, if you were charged 10,000 pesos on your debit or credit card at the official exchange rate of 155 pesos, it would be equivalent to 64.30 USD. Whereas if banks had access to the MEP exchange rate, this would equal US$34.24; saving you half of what you would have paid in US dollars.
This rate will apply to everything tourists pay for with their credit card, including hotel rooms, restaurants, tours, attractions, movie tickets, etc.
Previously, tourists in Argentina exchanged their money for cash in illegal and unofficial places at the Dolar Blue rate to avoid the official exchange rate. The Dolar Blue rate is considered closer to the MEP exchange rate, so with the introduction by Argentina of an exchange rate closer to this one; tourists will be able to stop carrying so much cash and use their credit and debit cards without being penalized.
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How does the exchange rate work now?
The new exchange rate process means that travelers can now pay in pesos on their cards and their money will be converted from dollars to a fixed exchange rate for tourists, instead of the official rate. Credit card companies will receive the dollars and have five days to convert them using the MEP exchange rate through the financial markets, but credit cards may also charge a commission on the transaction. The new rules have already come into force, so you can start trading at this more generous rate today.
Why is Argentina doing this now?
Argentina has a web of different exchange rates, which can be confusing for tourists visiting the country for the first time. With unofficial exchange rates, like the Dolar Blue, offering more lucrative offers for tourists exchanging their money, this has created a more cash-based tourism industry. According to the Buenos Aires Times, an estimated US$200-250 million is pumped through the country through tourism, but only US$30 million of that goes through official channels.
As the country heads towards 100% inflation, the government has been tasked with finding a solution that will encourage tourists to put money back into the Argentine financial system and help post-pandemic recovery. Officials also believe it will provide more security and efficiency for tourists coming to Argentina, while formalizing the sector and putting pressure on the Dolar Blue.
“The measure was highly anticipated. Domestic tourism had been favored by Previaje, but inbound tourism has lagged in its post-pandemic recovery and this will be a good boost,” said Gustavo Hani, president of the Argentine Chamber of Tourism. “It helps foreign tourists encourage them to use their credit or debit cards; it makes things safer and more predictable for them.
Will this new exchange rate hack make you book a trip to Argentina this year? They removed all entry requirements in April, in addition they express how much they want long term digital nomadsit is therefore perhaps the ideal country to stay there for a while.
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This article originally appeared on TravelOffPath.com