Progress in the Liberalization of the Forex Market
The BCRA has taken further measures in the process of removing and relaxing the regulations on access to the forex market, aimed at eliminating all restrictions.
Today, the Board of the BCRA decided to shorten the term for companies to access the Free Foreign Exchange Market (Mercado Libre de Cambios, MLC) to pay for their imports, increase the amount that exporters of services are not required to settle in the MLC, and allow people who had received State aid during the pandemic or who benefit from subsidies in public utility rates to carry out foreign exchange transactions through securities in foreign currency.
The import payment schedule, implemented as of December 2023, favored the accelerated international reserve accumulation, thus, generating a stock of commercial debt. In response to the better-than-expected results of the program, the BCRA is moving forward with the normalization of foreign trade, allowing for the reduction of debts.
RELAXATION OF IMPORT PAYMENT TERMS
Since the BCRA's authorities took over on December 10, 2023, the flow of imports—which had been virtually halted by the countless barriers to access the forex market and the accumulated commercial debt—has been gradually normalized with a transparent and predictable payment scheme. In the first half of 2024, payments for imports made through the MLC went back to around 100% of the average monthly amount of imports.
Currently, energy-related goods are paid in cash. Importers of pharmaceuticals, health products, fertilizers, phytosanitary products for domestic production, basic food basket products, and goods registered by MSMEs have access to the MLC 30 days after customs registration.
Luxury goods and finished cars are paid 120 days after customs registration. Hence, the Board of Directors decided today that, as from August 1, 2024, importers of these goods will have access to the MLC 90 days after customs registration.
Remaining goods will be paid in four installments equal to 25% of their value at 30, 60, 90 and 120 calendar days after customs registration. As from August 1, 2024, importers will have access to the MLC to pay for these goods in two installments: 50% at 30 days and 50% at 60 days after customs registration. This group accounts for more than half of total imports.
This measure has a twofold positive impact: (i) it contributes to economic reactivation by allowing import companies to bear less financial burden, and (ii) it reduces the higher cost pass-through to prices associated with the current payment schedule, which forced companies with no commercial financing from suppliers to make payments through the parallel forex market.
INCREASE IN THE AMOUNT THAT EXPORTERS OF SERVICES ARE NOT REQUIRED TO SETTLE
As part of the process of normalization of the foreign exchange policy, the Board of Directors has also decided to increase the amount exempt from mandatory settlement for the export of services provided by natural persons. This adjustment now allows exporters of services to credit up to USD24,000 per calendar year to their domestic accounts in dollars without the requirement of settlement in the MLC. Previously, exporters could only credit up to USD12,000.
REMOVAL OF RESTRICTIONS TO OPERATE WITH MEP AND CCL DOLLARS
The third measure adopted by the Board of Directors was to remove restrictions on transactions in MEP and CCL dollars, allowing people who had received State aid during the pandemic or who benefit from subsidies in public utility rates to carry out such transactions.
All persons included in this category are now allowed to obtain mortgage loans in pesos and purchase MEP dollars to carry out real estate transactions.
July 23, 2024
