What the small print says about the decision the Central Bank announced on Tuesday.
This was announced by the Central Bank on Tuesday the implementation of a special and temporary exchange rate designed so that agricultural producers have an interest in liquidating their soybean crops, and then the government can get hold of the dollars that are in short supply today. The fine print of that decision prohibits soy farmers who come back for that “soy dollar” from doing 7 things.
The special grain settlement regime, according to official sources, seeks “recognize the foreign currency value that the asset has (soy in this case) “while trying “eliminate the uncertainty about a devaluation”. And for the BCRA it means the ability to anticipate the entry of foreign currency into the economy with a neutral economic equilibrium.
According to the body headed by Miguel Ángel Pesce, this special scheme will allow producers to make a sight deposit in financial institutions with variable daily remuneration based on the evolution of the A3500 exchange rate, known as the Link Dollar, up to 70% of the value of grain sales.
Also, for the remaining 30% the formation of external assets will be allowed, at the value of the official dollar plus PAIS tax and withholding taxes received by AFIP.
However, not everything is advantageous for the producer who opts for this special regime, there are some operations that will remain closed for 90 days.
What will the agricultural producer who overturns not do for this special change?
BCRA requires an affidavit from the client committing to the following for 90 days:
- will not organize sales in the country of securities in liquidation in foreign currency.
- They will not exchange securities securities issued by residents for foreign activities;
- It will not transfer securities securities to depositories abroad
- I will not purchase in the country securities issued by non-residents with settlement in pesos
- It will not acquire Argentine depository receipts representing foreign stocks.
- It will not acquire titles representative of private debt issued in foreign jurisdiction.
- It will not deliver funds in local currency nor other local assets (with the exception of foreign currency funds deposited with local financial entities) to any human or legal person, resident or non-resident, connected or not, to be received as a preventive or subsequent consideration, directly or indirectly, alone or through a related entity, subsidiary or parent, foreign assets, cryptocurrencies or securities deposited overseas.
What the full Central Bank statement on the soybean dollar says
The Board of Directors of the Central Bank of the Argentine Republic approved today (for Tuesday) a new tool for agricultural producers who sell their soybean cropalong the same lines as the benefits received by the manufacturing, energy and knowledge industries that increase their exports.
In this case, producers will be able to make a sight deposit in financial institutions with variable daily remuneration based on the evolution of the A3500 exchange rate, known as the Link Dollar, for a maximum of 70% of the value of grain sales.
Also, for the remaining 30% The formation of external activities will be allowed, value of the official dollar plus PAIS tax and withholding taxes received by AFIP.
This BCRA decision seeks to balance agricultural producers with the benefits available to the various productive sectors, including the free availability of foreign currency for the increase in exports achieved compared to the previous year which applies to the manufacturing industry; the Export Investment Promotion Regime or the Knowledge Industry Regime which allows you to apply part of the increase in exports to the payment of wages.
In the case of the soybean crop sales scheme will be available until August 31st. During this period producers will be able to purchase freely available foreign currency for 30% of the funds obtained from the sale of cereals for export and convert 70% into a freely available deposit with variable remuneration based on the evolution of the type of official modify.
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Source: Clarin
