Trending

Newsletter

Fly and Buy in New York for Less than at Home in Argentina

By: Belén Marty - @belenmarty - Aug 3, 2015, 11:04 am

EspañolThat tech gadgets in Argentina are more expensive than in the rest of Latin America is no novelty. But the gap is getting ridiculous: it now costs more to buy a MacBook Pro in Argentina than to travel to the United States, stay for five days with all expenses included, buy that same laptop, and return to the country.

El precio de una computadora Macbook Pro nueva en el principal revendedor de Apple en Argentina. (Captura de Pantalla)
A Macbook Pro in Argentina costs more than twice as much as in the United States. (iPoint)

Technology is not only prohibitively expensive in Argentina. More often than not, the full line of products for a certain brand is not readily available and consumers must settle for older models.

A quick online survey of Argentinean stores reveals that even the most basic laptop models are between 30 and 40 percent more expensive than those offered in the United States.

But the gap in the most expensive products suggest there is something more to it than just a good deal commonly found abroad. We decided to check the report of El Destape, the outlet that first discovered the extraordinary case.

They were right.

With the money someone would spend to buy a MacBook Pro in Argentina, he could afford a round trip ticket to Manhattan, spend five days there, eat, pay for transportation, attend a Broadway show or some other performance — and buy the computer.

Foreign-Currency Control Follies

First, we need to understand Argentina’s difficult relationship with foreign currencies. Since 2011, Argentineans have struggled with several restrictions, most notably the government-imposed four different exchange rates for the US dollar.

Argentineans wishing to purchase dollars to acquire a good or service can only obtain the lowest exchange rate there is, the official one, through an authorization from the country’s tax agency. If the person wishes to keep the dollars and not buy anything, the government adds a 20 percent markup — this rate is called the “savings” dollar. The maximum amount of savings dollars Argentineans can buy is 20 percent of their average salary earned over the past 12 months.

When shopping abroad with their credit or debit cards, Argentineans buy “tourist dollars,” a rate 35 percent more expensive than the official one. There’s no maximum amount allowed other than one’s card limit.

Then there is the “blue” rate. It’s available only in the black market, and is worth 63 percent more than the official rate. This is what common Argentineans are able to buy if they don’t own credit or debit cards, and if the tax agency refuses to give them dollars at the government rate.

Numbers Don’t Lie

A MacBook Pro in Argentina costs AR$41,479, while in the United States you can get the same computer for US$1,499 (AR$18,557 at the tourist rate).

A round trip ticket to the United States can be bought online for AR$11,000 (US$888). At US$50 per night according to Airbnb, you can stay five days in New York City for about AR$3,000. Give or take US$100 per day on expenses (food, small purchases, transportation), you can add AR$6,500 to the bill.

Everything, including the purchase of the MacBook Pro, amounts to a grand total of AR$39,057. Upon return to Argentina, you would have AR$2,422 left if you are able to sneak past customs.

as
As the specs and quality of the product increases, the gap in consumer prices between the United States and Argentina does so as well. (Nikon)

However, if customs officers catch you with a new good surpassing the US$300 limit, you will have to pay up half of the value exceeded. That would add extra US$600 to the bill (close to AR$5,490).

This is just one case among many. Another telling example are professional cameras employed by reporters to make a living. A cutting-edge Nikon D4 costs AR$135,824 in Argentina, versus US$6,000 in the United States (AR$74,280 at the tourist rate).

In this case, there’s an extra expense of AR$61.544 (US$6,701). This is enough money to travel to Manhattan, cover basic transportation and food expenses, and stay at one of the most exclusive hotels, the New York Plaza Hotel, for US$650 a night. Again, you would have more than enough money to return to Argentina.

Technology consultant Enrique Carrier explained this gap in consumer prices to the Argentinean newspaper El Clarín: “Several factors drive up these products within the country. The 2009 law increased many of the taxes applied to them, and the value added taxes (IVA) that consumers pay when buying these products is also higher than in many other countries. Since many brands do not bring their goods into Argentina, demand has declined. And the consequence is technological lethargy, because many people can only have access to less advanced technologies.”

The consequence of government controls is less technology and a non-competitive domestic industry. It makes us seem we’re living in a technological Stone Age — and what’s worst, those who suffer the most are poor Argentineans, who cannot afford the luxuries of traveling abroad.

Translated by Franco Bastida.

Belén Marty Belén Marty

Belén Marty is the Libertarian Latina, a journalist based in Buenos Aires, Argentina. She has lived in Guatemala, Jordan, the United Arab Emirates, and the United States and is a former candidate for local office with Argentina's Libertarian Party. Follow @BelenMarty.