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6/10/13

A "special dollar" for mining in Argentina

A new and potentially positive development for mining companies in Argentina is that according to several reports (here's one) the country's Mining Minister, Jorge Mayoral, met with provincial governors who belong to the OFEMI pro-mining group of regions and told them that the national government would give the industry a "special dollar" rate soon, which would be a  Argentine Peso/U.S. Dollar forex that would "blend" the official rate of exchange with the unofficial "blue dollar". 

At present, if mining companies (like any other officially declared company) wants to exchange their dollars for Pesos they need to do it at the official rate (currently around 5.30 to the USD), whereas the unofficial "blue dollar" sells for 8.57 at present. If Miners can get a preferential rate for their greenbacks soon, it will greatly ease the inflation problems they've been hitting and make costs more competitive.

This initiative is by no means official policy yet, but the sources are good and if it comes to pass may spark some renewal interest in the beaten-to-death Argentina mining sector.