Argentina imposes currency restrictions to sustain economy over current recession

As a result of the deep recession ongoing in Argentina, the government has imposed currency restrictions, especially foreign currency purchases in an attempt to sustain the economy of the country.

BBC reports that, in an official bulletin issued on Sunday, the government said that it was necessary to adopt “a series of extraordinary measures to ensure the normal functioning of the economy, to sustain the level of activity and employment and protect the consumers.

Following a sharp drop in the value of the peso, Argentina’s legal tender, firms will have to seek central bank permission to sell pesos to buy foreign currency and to make transfers abroad.

Also in a bid to impose currency controls, the country is also seeking to defer debt payments to the International Monetary Fund (IMF) to deal with the crisis.

According to the country’s Central bank, the measures which will be applied until the end of this year, were intended to “maintain currency stability”.

It also said that while individuals can continue to buy US dollars, they will need to seek permission to purchase more than $10,000 (£8,223.50) a month.

According to BBC reports, Argentina, which is now one of the world’s highest inflation rates, has been experiencing financial crises for some time, running at 22% during the first half of the year.

It is reported that the recession exacerbated as a result of the President Mauricio Macri;’s defeat in a recent primary poll.

The peso fell to a record low last month after the vote showed that the business-friendly government of President Mauricio Macri is likely to be ousted in elections in October.