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Traveling to Argentina has become even more attractive with the Argentine government just launching a new tourist exchange rate, which effectively doubles your cash as you make purchases. As of last Friday, tourists who do not reside in Argentina or do not have an Argentine credit or debit card will be able to access a rate similar to the ‘Dollar MEP’ (Electronic Payment Market) exchange rate, which is almost equivalent to the illegal rate ‘Dolar Blue’ which tourists usually access for cash.
Gone are the days of asking your local friends to change 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 price of the MEP Dollar was around 292 pesos per dollar, while the official price was 158 pesos per dollar. By switching to the MEP rate, you get almost double pesos for your dollar compared to the official rate that applies to payment methods abroad.
“In effect, the measure introduces an exchange rate 90 percent higher than the official rate applicable to all tourist expenses in the country, including excursions, meals and tour packages,” wrote The Buenos Aires Times.
How did the exchange rate work before?
If a tourist was paying an expense with a credit or debit card, the cost of this would be converted at the official exchange rate, which was the one used by banks.
The Buenos Aires Times explains that if you were charged 10,000 pesos on your debit or credit card at the official exchange rate of 155 pesos, this would equate to US$64.30. While if the banks had access to the MEP exchange rate, it would be equivalent to US$34.24; saving you half of what you would have paid in US dollars.
This rate will be applied to everything that tourists pay with their credit cards, 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 exchange rate to avoid the official exchange rate. The Dollar Blue exchange rate is considered closer to the MEP exchange rate, so with the introduction in Argentina of an exchange rate closer to this; 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 travelers can now pay in pesos on their cards and their money will be converted from dollars at a fixed tourist exchange rate, rather than the official rate. Credit card companies will receive the dollars and have five days to convert them to the MEP exchange rate through the financial markets, but credit cards may also charge a fee for the transaction. The new rules have now gone into effect, 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, such as the Blue Dollar, offering more lucrative deals for tourists exchanging their money, this has created a more cash-based tourism industry. According to the Buenos Aires Times, around US$200 to 250 million is pumped through the country through tourism, but only $30 million of this comes through official channels.
As the country heads towards a 100% inflation rate, the government is tasked with finding a solution that encourages tourists to pay money back into the Argentine financial system and help in the post-pandemic recovery. Officials also believe this will bring more security and efficiency to tourists coming to Argentina, while also formalizing the sector and putting pressure on the Dolar Blue.
“The measure was highly anticipated. Domestic tourism had been favored by Previaje, but receptive tourism has lagged behind 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 to encourage them to use their credit or debit cards; it makes things safer and more predictable for them.
Will this new currency trick influence you to book a trip to Argentina this year? They dropped all entry requirements in April, plus they’re expressing how much they want long-term digital nomads, so it might be the perfect country to stay in for a while.
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This article originally appeared on TravelOffPath.com