The Argentine government is making strong moves to curb illegal dollar trading, especially as elections approach.
Law enforcement agencies have initiated a series of raids on venues known as “caves” in Buenos Aires.
These caves are notorious for facilitating the trading of U.S. dollars on the black market.
This measure is in response to a recent spike in the “blue dollar” rate, a colloquial term for the U.S. dollar’s value in the informal Argentine market.
Just last week, this rate crossed the 1,000 Argentine peso mark.
Sergio Massa, the current Minister of Economy, points the finger at these illegal traders for causing disruptive currency fluctuations.
Massa is not just a minister; he is also running for president.
To combat this issue, various government agencies, including the police, tax authorities, and customs officers, have amped up their investigations and raids.
Another presidential candidate, Javier Milei, is also in the spotlight. He has discouraged people from saving money in the Argentine peso, calling it worthless.
Authorities took this seriously and have filed a criminal complaint against him for inciting economic instability.
Experts attribute the existence and growth of these illegal trading venues to two main factors.
The first factor is that a portion of the money involved in these transactions comes from illicit activities, such as drug trafficking or smuggling.
The second factor is non-compliance with currency declaration by certain business sectors, particularly those involved in agriculture like soybean trading.
In a recent raid, law enforcement nabbed a significant currency speculator, “the Croatian.”
Larger Economic Crisis
Additionally, a day prior to this, police found two individuals physically carrying $700,000 in vacuum-sealed bags.
These incidents underscore the government’s commitment to crack down on illegal financial activities.
Observers and experts believe that the government is keen on preventing what could become a larger economic crisis.
The black-market trading of dollars adds another layer of risk to Argentina’s already volatile economic landscape.
The government’s current actions aim to stabilize the currency and deter illegal activities before they escalate further.