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the phenomenon of consumption in neighboring cities driven by the exchange rate gap

the phenomenon of consumption in neighboring cities driven by the exchange rate gap

The massive visit of buyers from neighboring countries generated an impact on consumption in border cities.

While some indicators point against a possible drop in the consumption internally in the coming months, the exchange difference begins to consolidate a phenomenon that was accentuated in 2023: the arrival of visitors from neighboring countries with the main purpose of making massive purchases.

The shopping tours, which focus especially on the consumption of mass circulation products (non-perishable food, cleaning and personal hygiene products) displacing durable goods, have spoken in recent months, generating a situation that specialists call “Province 25“. In this way, buyers arrive at border cities with dollars that change in the informal market to purchase goods at one-third the list price of their countries of origin.

A study of the Mediterranean Foundation points out that, in addition to the exchange rate gap, the phenomenon is accentuated by the program of “Fair Prices” enabled on supermarket chains and the arrangement of products mass consumption imported to the official dollarwhich would represent a lower cost.

“Between January-March 2021 and the same period in 2023, the fuel sales they increased by 9% in the country average, but they did so by 35% in Formosa29% in Missions24% in currents and 22% in Between rivers“supports the organism.

In addition, they contemplated “the variation in real terms of the gross revenue collection from a province like Buenos Aires was only 3%, between January-April 2021 and the same period in 2023, while that figure was no less than 28% in Jujuy12% in Formosa10% in chaco and 9% in jump and Mendoza“.

In this sense, the consultant Nielsen He referred to the sales of mass consumption products, recording an increase of 4.6% for the country’s average by 2022, but with a much higher rate in neighboring towns, in the case of Clorinda with 33%; iguazu, 120%; 16% for inns and 27% in Gualeguaychu.

Source: Ambito

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