The president of the BCU, Diego Labat, signed a Letter of Intent together with his Argentine counterpart from the BCRA, Miguel Pesce.
The president of the Central Bank of Uruguay (BCU), Diego Labattogether with his Argentine counterpart, the holder of the Central Bank of the Argentine Republic (BCRA), Miguel Pesce, signed a Letter of Intent to reduce transaction costs in trading local currencies through the Payment System in Local Currency (SML).
Both central banks seek to promote the development of low-cost financial instruments for all those operations that involve the Uruguayan peso or the Argentine pesoin a search to stimulate foreign trade between both countries.
The signing of the Letter of Intent took place within the framework of the LXII Meeting of Ministers of Economy and Presidents of Central Banks of the mercosur that will take place in the city of Puerto Iguazu (Missions, Argentina).
Uruguay and Argentina seek to expand the operations of the current SML
According to the official statement released by the BCRA, “both central banks committed to work to expand the operations supported in the current SML between Argentina and Uruguay”.
From the Argentine central bank they add that the SML allows “to become familiar with the use of the other country’s currency, in addition to promoting progress in the economic integration process” and “strengthening the links between the institutions that signed the letter of intent, increasing liquidity and efficiency” of the exchange market between the Uruguayan peso and the Argentine peso.
The agreement seeks to incorporate payments related to trade in services (except those payments related to financial services), as well as transfers for family support, and to allow the transfer of resources to be denominated in Uruguayan pesos or Argentine pesos, indistinct way.
Based on understandings between both government institutions, the technical and operational aspects will now be observed, as well as the usage requirements necessary to carry out the potential agreement.
Source: Ambito
