When Argentina's President Cristina Fernandez de Kirchner spoke at Harvard University last week, one of the concerns among the Argentines in the audience was her government's far-reaching currency controls and the difficulties they impose on students and travelers going abroad.
One such student, Victoria, traveled from Argentina to study English for three months in Cambridge, Mass. this fall. But she says the fact that she obtained enough US dollars to actually get here was "a miracle."
Between cash she had set aside every month and a gift from her grandfather, she had enough money for a course at Kaplan International. The challenge, Victoria says, came from Argentina's recent currency controls.
In an attempt to keep dollars in Argentina amid a wave of capital flight, the country's tax office in May introduced a series of hurdles for citizens wanting to travel abroad with foreign currency. The government relies on money from the central bank and nationalized pension system to pay international lenders who typically require their payments in international currency.
The Argentine currency is the peso, and just over a decade since the country’s 2001 economic meltdown, dollars are seen as more stable and thus desirable. The lack of confidence many Argentines have in their own currency, highlighted just last year by increased capital flight in the lead up to Ms. Kirchner's October reelection, put those payments at risk.
Victoria, who asked her last name not be used for fear of having trouble exchanging pesos for dollars in the future, says she filled out a form in August to purchase the US currency and was approved for $8,000 dollars. She called it a miracle because she says many people have been turned away for seemingly no reason. Her boyfriend, for example, won’t be able to visit because his request was denied. The rest of her expenses are going on her credit card.
At the Harvard event Thursday, Kirchner spoke to an audience of 100 students, faculty, and community members on topics ranging from the global recession to human rights, and answered questions from a handful of students – including a question on currency controls.
Her response was in keeping with her confrontational style.
“I think Argentines travel very well,” she said, noting the nationals she has seen in places like Las Vegas, and even here, in Cambridge. “You are Argentine. You are here. So you don’t seem to have problems with dollars,” she told the Argentine graduate school student. “You’re lucky enough to be at Harvard. Do you really think you can talk to me about currency controls?
“As president I have to take care of these reserves,” she said.
Marcia Florencia Chiaramonte, an Argentine Spanish teacher who has been working in the Boston area since before the currency controls were implemented this past spring, says she understands why the government has introduced restrictions.
Ms. Florencia says in order to make the peso stronger, the government has to stop people from using the dollar like it’s the official currency. “The peso is our currency,” she says. “There is a purpose to this – the government is not being authoritarian.”
But, she acknowledges, “people don’t like that they have to explain why they are going on a trip and why they need the money.” Florencia says Argentines have to divulge how much they earn, where they are going, how long they are traveling, and the reason for their trip. “They feel it’s an invasion,” she adds, noting that her parents recently visited and had no trouble getting dollars.
In Argentina “there is a culture of complaining,” Florencia says. “So people protest. They complain…. But I think most of [the president’s] policies are good for Argentina”