4 ms·

Knowing Argentina's history with currency control, parallels economies and punitive import duties, it's probably the later where some insiders are pocketing the

Knowing Argentina's history with currency control, parallels economies and punitive import duties, it's probably the later where some insiders are pocketing the difference by claiming the car is "made in Argentina" (but is illegally imported from China). If you can't compete, slap duties!

kragen 4y ago
That's not how it works here. You import things legally from China—not only without the punitive import duties applied to finished products but actually at the currency-control-subsidized exchange rate, so you get a 40% discount courtesy of the central bank—assemble them in Argentina, slap an eagle sticker on them that says "Industria Argentina", and sell them domestically while enjoying the punitive-import-duty protection from foreign companies, all 100% legally. The only tricky part is that if the ruling party decides they don't like you, they'll 100% legally deny you the authorization to buy the dollars you need to import your parts. Then you're sunk: there's no legal way to import your parts, and as an aboveboard business you can't use parts you import illegally. So, better make sure you stay on their good side. This is a big reason why our GDP is smaller now than it was ten years ago. We were already in a crisis before covid.
- notch656a 4y ago
  Does Argentina have much of a Navy? There is quite a generous coast line. One that I would think would make customs control very tricky unless you have first world tier surveillance of the coasts.
  - bombcar 4y ago
    Heh then you’re not aboveboard anymore. But I’m sure there’s a thriving market. One of the countries down there even has a name for that type of vehicle - it was on HN last year or so.
    - kragen 4y ago
      You're thinking of "chutos" in Bolivia, probably, but those aren't smuggled into America as a whole, just across the borders between different American countries. Contrary to our friend's ridiculous assertions above, ships are easier to detect than trucks, and a container port is not an easy thing for smugglers to keep hidden. Argentina was founded on smuggling but it doesn't work like that :)
      - notch656a 4y ago
        >and a container port is not an easy thing for smugglers to keep hidden. This is one of those things that sounds obvious at first, but the intuitive answer turns out to be false. They (the containers, not the port) are very easy to hide in plain sight. There are simply massive quantities of them and it would grind trade to a halt to be inspected en masse. Therefore in US at least shipping containers are laughable easy for smugglers to "hide." In US whole shipping container full of illegal immigrant arrive. It's my understanding only a tiny fraction of container are meaningfully searched, and whole containers of imported material can enter the country illegally. Perhaps Argentina has much more sophisticated and honest customs and border protection than US. But also take into account profit on illegal imports can be very high in Argentina due to arbitrage against crippling taxation/duties. Example below. https://www.nbcnews.com/id/wbna3339957 https://www.nbcnews.com/id/wbna3339957
        kragen 4y ago
        You can certainly hide a container, but you can't hide a container port, much less a non-submarine ship in the open ocean, which is what your earlier comment suggested. Argentina definitely does not have customs officials as honest as those in the US, though perhaps they are more sophisticated. Traveling via container is a thing I've contemplated doing myself, if only I had the budget.
        notch656a 4y ago
        Via container? That is indeed an unusual desire for someone with options.

kragen 4y ago

That's not how it works here. You import things legally from China—not only without the punitive import duties applied to finished products but actually at the currency-control-subsidized exchange rate, so you get a 40% discount courtesy of the central bank—assemble them in Argentina, slap an eagle sticker on them that says "Industria Argentina", and sell them domestically while enjoying the punitive-import-duty protection from foreign companies, all 100% legally. The only tricky part is that if the ruling party decides they don't like you, they'll 100% legally deny you the authorization to buy the dollars you need to import your parts. Then you're sunk: there's no legal way to import your parts, and as an aboveboard business you can't use parts you import illegally. So, better make sure you stay on their good side. This is a big reason why our GDP is smaller now than it was ten years ago. We were already in a crisis before covid.

notch656a 4y ago
Does Argentina have much of a Navy? There is quite a generous coast line. One that I would think would make customs control very tricky unless you have first world tier surveillance of the coasts.
- bombcar 4y ago
  Heh then you’re not aboveboard anymore. But I’m sure there’s a thriving market. One of the countries down there even has a name for that type of vehicle - it was on HN last year or so.
  - kragen 4y ago
    You're thinking of "chutos" in Bolivia, probably, but those aren't smuggled into America as a whole, just across the borders between different American countries. Contrary to our friend's ridiculous assertions above, ships are easier to detect than trucks, and a container port is not an easy thing for smugglers to keep hidden. Argentina was founded on smuggling but it doesn't work like that :)
    - notch656a 4y ago
      >and a container port is not an easy thing for smugglers to keep hidden. This is one of those things that sounds obvious at first, but the intuitive answer turns out to be false. They (the containers, not the port) are very easy to hide in plain sight. There are simply massive quantities of them and it would grind trade to a halt to be inspected en masse. Therefore in US at least shipping containers are laughable easy for smugglers to "hide." In US whole shipping container full of illegal immigrant arrive. It's my understanding only a tiny fraction of container are meaningfully searched, and whole containers of imported material can enter the country illegally. Perhaps Argentina has much more sophisticated and honest customs and border protection than US. But also take into account profit on illegal imports can be very high in Argentina due to arbitrage against crippling taxation/duties. Example below. https://www.nbcnews.com/id/wbna3339957 https://www.nbcnews.com/id/wbna3339957
      - kragen 4y ago
        You can certainly hide a container, but you can't hide a container port, much less a non-submarine ship in the open ocean, which is what your earlier comment suggested. Argentina definitely does not have customs officials as honest as those in the US, though perhaps they are more sophisticated. Traveling via container is a thing I've contemplated doing myself, if only I had the budget.
        notch656a 4y ago
        Via container? That is indeed an unusual desire for someone with options.