Despite the fact that the Central Bank’s report for the month of November has not yet been released, which allows us to analyze the impact of the measure with a better perspective, there are some signs that can tell us how the Qatar dollar worked, how it could affect the reserves in the event for Argentina to advance in the World Cup and anticipate what will happen to tourism for next year.
Qatar dollar: small balance after more than a month of operation
The first official figures on the operation of the Qatar dollar showed a moderate decrease in the outflow of dollars through this channel and in September, this decrease deepened.
According to him Exchange Balance published by the Central Bank in October, Argentines made purchases abroad for a total of US$327 million, 16% below the US$391 million registered in September. The data has the caveat that the “Qatar dollar” regulations came into effect only on October 12, for which reason the entire month did not work.
However, according to Santiago Manoukian, Head of Research at Ecolatina, “judging by the data on the stock of loans to the private sector in dollars, spending would have dropped again in November”. As of 11/25 (latest data), the stock of loans to the private sector associated with cards was close to US$230 million, 13% below the US$265 million of the same period in October (in the average of the month of stock amounts to $194 million, less than $245 million in October).
Reserves: what happens if Argentina advances in the World Cup?
In a country with a long sporting tradition like ours and given the possibility that Argentina could continue advancing in the World Cup, a Despegar report for Argentina and Uruguay began to set off alarm bells given the sharp increase in searches to travel to Qatar after the win against Poland. Although search does not mean sale and most Argentines had already reserved their tickets and stay in advance, it is not ruled out that those who can travel even for a date, do so.
According to Despegar, after the game with Poland, flight searches to reach Qatar increased by 301% compared to the previous day. It was the busiest day of searches in the month of November. At the same time, searches increased 92% more than in the previous match of the National Team against Mexico on 11/26. In the last hours, even Aerolíneas Argentinas added flights for short stays in Doha.
It is also added that as of December 2, travelers will be able to enter Qatar without having to have a ticket and a confirmed hotel, they just have to make the Hayya Card and put the option “Early December Hayya” which is approved in a few minutes. . The prices of a flight to Doha with stopover and round trip luggage per person start from US$1257M.
According to the LCG consultancy, “we do not consider that the current situation of the team will modify the travel plans in the short term, the people who had already organized are probably already in Qatar, it will not greatly influence the behavior of the service account. Given that the tourist dollar policy was applied late in the year, it did not have the opportunity to radically modify the incentives for Argentines to travel, the dynamics had already been set since the beginning of the year”.
But there is no consensus among economists on this issue. Manoukian states that more than new trips, the issue is the permanence of Argentines in Qatar for longer. “It could continue to put pressure on the outflow of foreign currency through higher card expenses” despite a more expensive dollar. But for those who might be traveling, “the higher cost of the Qatar dollar compared to the blue one (+10%) reduces incentives to spend with cards, which is a factor of pressure on the value of this last dollar.”
According to a monetary report from the LCG consultancy, as a result of the start of the World Cup, an increase in the deficit of the tourism account can be observed, which will impact the balance of the services account. Even so, the total of the services account visualizes a deficit of US$5.925M so far in 2022, quite in line with what was observed in 2019 when the deficit was US$5.764M. In this way, Through tourism, the Central Bank managed to stay at acceptable levels thanks to the increase in taxes to travel abroad. Therefore, despite the departure of Argentines for a few days to see the Argentine National Team or the stay of those who are already in Doha, no surprises are expected in the departure of dollars from the country.
Outbound tourism: what could happen to the Qatar dollar in 2023
But Argentines who want to travel next year will also have a difficult time. According to Manoukian, “the increase in the perception of personal assets or profits could continue to increase in order to make the tourist dollar more expensive. The risk is that this puts more pressure on the blue, since it generates the incentive to demand more “bill” dollars instead of “card dollars”, which in turn stimulates the “black”.
LCG, for its part, foresees that the card dollar in 2023 “can continue to increase in line with the increases of the official, which in recent months has moved at a rate of 6% per month, although a large devaluation jump is not expected; but it is not probable that they seek to increase the taxes that compose it, because the mechanisms to do so are not easy to execute”.
Source: Ambito
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