Argentina’s presidential frontrunner wants to dollarize the economy, but many already use the greenback.
Private firms in the country are partially paying in dollars to retain skilled workers.
And more businesses are accepting dollars as payment as the peso crashes.
While Argentines used dollars even before presidential candidate Javier Milei campaigned on ditching the peso, the private sector is increasingly dollarizing the economy on its own.
That’s as the country’s hyperinflation and deep deficits have slammed the peso, which is worth less than a third of a penny at official prices and just a 10th of a penny at unofficial prices, according to Bloomberg.
The peso is one of the world’s worst performing currencies, having lost more than 20% against the dollar in the past month and more than 90% in the last five years.
Now, an estimated 200,000 skilled workers in Argentina’s tech sector are paid in dollars or euros, Bloomberg said, citing an Argencon report. Such reliance on foreign currencies comes as peso-based jobs suffer a turnover rate of over 30%.
E-commerce giant MercadoLibre, consulting firm Accenture, software developer Globant, and fintech firm Ualá offer partial pay in greenbacks, according to reports.
Other dollar-paying companies include the travel firm Despagar, software company Beltarix, and fintech’s VTEX.
In addition to staff salaries, the private sector is increasingly accepting dollars as a form of payment as well.
For example, US website firm GoDaddy stopped accepting Argentinian peso payments in June, changing to dollars.
And more than 60% of apartment listings in Buenos Aires price rents in dollars, up from 20% two years ago, according to data from real estate website ZonaProp cited by Bloomberg.
Airbnb rentals are also requiring dollars, and some restaurants are pricing their dishes in dollars on their menus.
But this enthusiasm for dollars isn’t shared by everyone. For instance, economist Robin Brooks said Argentina needs spending cuts and a recession to fix the peso, while warning that dollar dependence brings its own risks.
He also suggested Argentina would be better off pegging its currency to the Brazilian real instead of the greenback.