Argentina turns to Brazil for paper money

BUENOS AIRES – Argentina, struggling with the highest inflation in the region, has turned to its neighbour Brazil for newly printed banknotes in the face of a shortage of paper money that fuelled public anger.

Officials said this week that 130 million banknotes of 100 pesos (around US$25) were being shipped from Brazil, under an agreement signed by the two governments in November.Miguel Angel Pesce, vice president of the Argentine central bank, said new banknotes were on their way in the coming days and that ‘we will not repeat the episodes’ of recent weeks.The problems hit a peak over the weekend, which saw long queues at bank teller machines, many of which ran out of cash and prompted people to start hoarding their banknotes.The government of President Cristina Kirchner has said the cash shortage may have been the result of increased spending over the year-end holidays and people putting aside funds for vacations in the austral summer.But some say the authorities have failed to acknowledge the extent of inflation and the higher need for cash.In Argentina, inflation was around 10 per cent from January to November, according to official figures, which some analysts say is underestimated.Argentina’s mint, using machines from 1970, can print around 400 to 500 million banknotes of various denominations each year, but demand is running at a pace of 600 to 700 million.- Nampa-AFP