Over the past eleven months, we’ve chronicled Argentina’s currency restrictions and the crippling spillover effect on real estate activity, primarily in the existing property market.
Just as Uruguay hotels and tour operators are being equal parts creative and proactive in crafting programs to circumvent the cepo cambiario, so too are Argentina money managers, multinationals and currency exchanges. “Contado con Liquidacion Inverso,” henceforth CCLI, is a very off-the-record way for investors to get 50% more funds into the country in order to purchase real estate, luxury cars or other assets.
Cronista’s Mariano Gorodisch breaks down the CCLI process like this: “A company (or individual) buys a highly-liquid Argentine bond (Boden 2015, Bonar 2017) or ADRs on Wall Street. Then the investor sells those bonds or shares on the BA Stock Exchange and converts at a rate of $7.20 pesos per dollar, thereby earning an additional 50% just on the spread differential between the official rate and the CCLI rate.
While CCLI is not illegal, the money managers and brokers Gorodisch interviews all requested complete anonymity. They also advise any potential investors looking to get money into Argentina at this favorable exchange rate to do so sooner rather than later. Many foreign companies are already accelerating transfers of funds into Argentina, because elimination of the CCLI loophole is not a matter of if but when. (Full Story in Spanish)
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