Argentina has set up an agency to keep track of the international transactions of the companies operating in the country. Known as the Tracking and Tracing of Foreign Trade Transactions Unit, the agency will keep an eye on the import and export of goods and services.
The agency comes into force barely a fortnight after the South American country suspended the operation of US consumer giant Procter and Gamble on charges of inflating prices of goods imported from Brazil.
Upon launching the agency, a senior official stated that in recent months the government had identified 9,600 cases of forex law violations.
Argentina is concerned that a large number of corporations are hiding their profits in an attempt to avoid paying taxes. Beyond the violations, its major concern is the nation’s decreasing foreign currency reserves, a key tool to rein in on currency upheavals.
According to the official bulletin, the unit will “monitor foreign trade transactions, for its tracking and tracing” and “ensure compliance with formal and substantial requirements” in foreign trade reports.
It went on to say that such an agency was needed to ensure macroeconomic stability and prevent violations of forex-related laws.
Argentina, banished from the international capital markets following its default on bond repayments, is concerned over capital outflow. Growing inflation and decreased foreign investment have left the government unable to turn the economy around.