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Latest! Exporting to this South American power has welcomed policy benefits, with restrictions relaxed

Publish Date: 2024.04.13

  On April 8th, the Argentine government announced that the Ministry of Economy had cancelled the obligation for a series of products to undergo customs inspection through the "red channel". This regulation requires strict customs inspections of imported goods, leading to cost and delay issues for importing enterprises. From now on, the relevant goods will be inspected according to the random inspection procedure established by the customs for the entire tariff.

  01. Cancel the import red channel


  The inspection of imported goods by Argentine customs is divided into three stages: green, orange, and red channels. Previously, certain industries were required to accept the strictest channels (in red).


  Industries affected by anti-dumping measures, including textiles, footwear, and products, need to clear customs through the red channel. Radiators, air conditioning units, fans, tableware, hot water bottles, boilers, and lids are also subject to the same scrutiny.

  The red channel process requires the cessation of goods clearance at Argentine customs, extends product delivery deadlines, and significantly increases the inspection costs borne by importers.


  Faced with these cumbersome procedures, the Afghan government has cancelled 36% of the import business included in the red channel, which accounts for 7% of the total import business in the country.


  02. Implement a new import payment system


  On December 13, 2023, the Central Bank of Argentina issued a regulation detailing how to enter the foreign exchange market based on various industries.


  Previously, due to a severe shortage of foreign exchange reserves, Argentina required all imported goods to be declared in advance and obtain a license to import. In October 2022, Argentina launched a new import monitoring system (SIRA) mechanism to further strengthen import supervision. Even if Argentine importers have the quota to enter the foreign exchange market for exchange, under the new system, their central bank can approve foreign exchange payments for up to 180 days.


  According to the latest notice No. 7917:


  For import payments of goods, starting from December 13, 2023, SIRA with an "export" status is no longer required to enter the foreign exchange market, nor is it necessary to verify operations in the electronic system of the "Foreign Trade Unified Settlement Account".


  Starting from December 13, 2023, for installment payments of newly imported goods with customs registration, banks can enter the foreign exchange market without the prior consent of the central bank, provided that payments follow the schedule of the predetermined type of goods. The schedule is as follows:


  a) From the date of entry customs registration, the FOB value of fuel and electricity can be immediately paid.


  b) Within 30 calendar days from the date of entry customs registration, payment can be made for drugs and/or raw materials used for local pharmaceuticals, as well as other goods related to healthcare. In addition, fertilizers, plant protection products, and/or raw materials used for local production can be paid for.


  c) The maximum payment period for the entire vehicle and other final goods is 180 days.


  d) For other goods, the payment of their FOB value can be completed within the following time period calculated from the date of entry customs registration: 25% from 30 calendar days; An additional 25% from 60 calendar days; An additional 25% from 90 calendar days; The remaining 25% starts from 120 calendar days.

  It is worth noting that on March 12th local time, Argentine presidential spokesperson Adoni announced that the Argentine government has ordered the opening of imports of food and medicine in household necessities, with the aim of responding to the current inflation situation and achieving "competitive prices". This opening measure is a supplement to a series of economic policies announced by the Argentine government in December last year, aimed at achieving trade normalization and complying with international rules of the World Trade Organization.


  Adoni announced that "the Argentine central bank will shorten the payment period for imports of food, beverages, cleaning products, personal care and hygiene products, from the previous 30 day, 60 day, 90 day, and 120 day installment payments to a one-time payment of 30 days." In addition, it has decided to suspend the additional value-added tax and income tax on the aforementioned products and drugs for 120 days. The main beneficiary products include bananas, potatoes, pork, coffee, canned goods, cocoa products, insecticides, shampoo, diapers, etc.


  Despite the recent relaxation of import restrictions by the Argentine government to reduce import costs and alleviate inflation, Argentina still faces problems such as rising prices, shrinking industrial production, and declining economic activity. According to data released by the Argentine Federation of Medium sized Enterprises (CAME), the retail sales of small and medium-sized enterprises in Argentina decreased by 25.5% year-on-year in February.


  Foreign trade enterprises exporting to Argentina still need to pay attention to risks!


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