Tuesday, January 21, 2014

Thinking of Moving to Argentina? A Word to the Wise

article from April 10, 2012
By Jamie Douglas

Once a favorite destination for expats, Argentina is being turned into a sadly neglected country by nationalistic socialism, rampant political corruption and total economic ineptitude. Que lástima.

The government of Cristina Fernández de Kirchner is currently nationalizing whatever it can get its hands on, starting with YPF-Repsol and Petrobras, the Spanish and Brazilian oil companies that have been doing business in the Southern Cone nation because this country is unable to run its own oil exploration. These exploration companies, rather than dealing with one authority, have to pay off the corrupt local officials of every province they want to do business in, to hell with international treaties.

The nation is racing backwards at supersonic speed, and will soon be back in 2002.

Example 1: We live near a relatively large town with several major supermarkets. During Easter Week, they were out of milk for three days. While orange juice is a luxury here, selling for over US$2 per liter, stores rarely have it. Rice, sugar, flower, cooking oil, and even the beloved mate are all in short supply.

Example 2: Fuel stations are often out of fuel. Many times, the amount of fuel you are allowed to purchase is limited to AR$50, when they have it at all. Of course, if you have the extra US dollars per gallon, you can go to one of the rare Shell or Petrobras stations and pay more to fill your tank.

I actually got to fill up the modest tank on my Renault today. And the wait was only about 20 minutes. During the peak harvest season, many trucks waited in line for days to get fuel while the fruit and produce rotted. Nobody in the government did anything about it. Meanwhile, exports to Chile, Bolivia and Paraguay continued unabated. There are some highly intelligent people at work here, somewhere, but not in the government.

Example 3: The last time the economy tanked, it was because of fiscal mismanagement and the lunatic idea of tying the new peso, called the austral, to the US dollar. And a lunatic idea it was. It led to the biggest sovereign default in the history of the world. It makes Greece look downright attractive in comparison. A lot of it, of course, had to do with high-cost imports of luxury goods. After the catastrophe, the Argentine government decided to set up a free-trade zone in Tierra del Fuego, where they would manufacture air conditioners and assemble computers, fans, microwaves and all kinds of domestic appliances. That would be wonderful, if the consumer would actually save money on these domestic products. I took a close look at the tiniest of microwaves today just to see where it was made because it cost US$250 for the same kind you get at Wal-Mart for $30. Sure enough, it was made in Tierra del Fuego!

Item 4: Taking your profits out of the country:  Forget it. Repatriating your money is forbidden unless you can get that unobtainable permit to send dollars out of Argentina. So what is a multinational company like, say, BMW to do? (It’s not like they sell a lot of their cars here.) In order to repatriate their money, they have to buy rice and export it to someplace that wants it, paying to ship it, warehouse it and broker it. Now that is messed up!

Item 5: As an Argentine citizen, you cannot take or send more than US$300 per person per month out of the country. It is illegal to send money to relatives who may be croaking in a hospital in Bolivia or anywhere else. And effective April 2, Malvinas Day, Argentinean citizens are unable to use their credit and debit cards abroad at all. All the borders and airports now have money-sniffing dogs, and they are quite good a sniffing out the loot, which will then become property of the state.

On the other hand, there are so many properties available all over this marvelous country that if you want to make a go of it, you will have many choices at very affordable prices. The important thing is to come here with family and all and get a feel for it. Having a working knowledge of Spanish is essential. Outside of the major cities, you will not find many fluent English speakers. But do not go down the street loudly proclaiming how this person dresses like a clown (it might be Cristina!) or that one there has a beer gut. You might be surprised at how many people understand English.

Jamie Douglas
San Rafael, Argentina

I encourage you to write me at cruzansailor [at] gmail [dot] com with any questions or suggestions you may have. Disclaimer: I am not in any travel-related business. My advice is based on my own experiences and is free of charge (Donations welcome). It is always my pleasure to act as a beneficial counselor to those who are seekers of the next adventure.