Argentina’s New Economy Minister Readies Plan to Boost Dollar Revenue

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New Economy Minister Sergio Massa is preparing a set of measures to address one of Argentina’s key problems: a chronic shortage of dollars that has caused the U.S. currency to soar in parallel exchange markets, Bloomberg News reported. Massa, who was named by President Alberto Fernandez last week as the head of an expanded and empowered economy ministry, is expected to unveil incentives to exporters as well as policies to attract more foreign investment and to capture additional tourism revenue, according to people with knowledge of the plan. On Monday, Massa tapped Raul Rigo, who had resigned just a month ago with former Economy Minister Martin Guzman, to return as treasury secretary. He will continue naming team members over the course of Monday and Tuesday, and said that he would start announcing policies in a press conference on Wednesday after he’s sworn in. The plan is being finalized with a renewed sense of urgency. The gap between the official and parallel exchange rates reached the widest level since the hyperinflation days of the 1989-1990s last month before narrowing in recent days. Foreign reserves are razor thin as Argentines, fearing an escalation of the crisis that claimed two economy ministers last month, continue to withdraw dollars from their accounts. Among measures under consideration are some that aim to improve conditions that would encourage farmers to sell their crops, which is the main source of hard currency for the country, the people said. That could include some kind of tax incentives for farmers, said one of the people, or the possibility that they can access a weaker exchange rate than the official one, said another. No official decision has been made yet. Read more.
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