Some foreigner with basic knowledge of economics came to Argentina and asked a sector of industrialists - led by my colleagues who whisper in their ears what they want to hear - “What does Argentina need to be more competitive?”
The question is not trivial, but the answer is not as easy as they conveyed to this foreigner. “A higher exchange rate,” they passionately demand; “That the government stop suppressing the dollar,” they add.
The foreigner, astonished by the response and without political contamination, asked with some incredulity: “Isn’t Argentina the country that has devalued its currency the most in the last 50 years? Why would it work this time?” There were no answers.
The more sophisticated ones attempt a technical euphemism: “We are not asking for a devaluation but for the government to remove the last remaining exchange regulation for companies.” They talk about the restrictions on companies' dollarization, because dividends have already been freed since the beginning of 2026.
They ask for something that would benefit a few Argentinians to live better off their dollar savings (myself included, for example) but would impoverish many more compatriots, especially the most humble. Furthermore, this deregulation would not facilitate operations for companies that are already enabled to transfer profits to their parent companies and, even before that, access the market freely to import and export without obstacles or gaps.
Completely freeing that stock of debt in pesos accumulated by ALL previous governments to Javier Milei's to finance decades of fiscal deficit only serves those who benefit from an artificially high exchange rate that has nothing to do with the long-term equilibrium of a country with the external accounts that Argentina plans for the next fifty years.
It is surprising that intellectually prepared people confuse such an elementary concept as expecting that the normal and usual flows of the country in a single year absorb without disruptive turbulence the imbalances accumulated over years that the last Peronist government boldly multiplied several times with uncontrolled currency issuance.
It goes without saying that the old politics destroyed our currency and that it was precisely this that forced all Argentinians to adopt bimonetarism with the dollar as the true unit of account. To ignore the impact of a gradual or shock displacement of the exchange rate due to a potential dollarization of that stock of pesos on prices (especially food prices) is either manifestly ill-intentioned or at least a profound ignorance.
No one with a minimum of judgment is unaware of the correlation between inflation and poverty. We learned this clearly in the last two years in a compelling way. This government managed to reduce inflation from 200% to 30% in two years with a mega adjustment, which caused a drop in the poverty rate from 45% to 29%.
So, those who ask to remove the last cross-restriction in the exchange market to “help companies improve their competitiveness,” do they ignore that it would come at the cost of greater indigence and hunger?; do they not realize that due to Argentina's bimonetarism, any increase in the exchange rate eventually translates into prices, making the nominal illusion of competitiveness very fleeting?
We return then to our foreign friend from the beginning of this column. If devaluing the exchange rate in Argentina were a tool to lower business costs so that they could export more, Argentina would already be the most competitive country in the world. Countries that have not systematically destroyed their currency can use that tool occasionally and with great caution. We cannot.
The only sustainable way to improve a company's prospects is to reduce its tax burden and useless regulations from the State. Business owners, for their part, must invest in innovation and technology, eliminate unnecessary expenses, and increase their sales volume (gain scale) as much as possible by lowering their prices as much as they can.
It is not with magic or handouts. It is with work and effort.
