Argentina Says Screw You to Foreign Tourists

Editor’s note – After 6 years of this policy depressing tourism and bringing the number of families visiting down dramatically, the newly elected government of Argentina scrapped this fee in March of 2016. See the full story here. I’m leaving this up as a historical study of a country implementing a policy for emotional reasons rather than business/revenue reasons.

After threatening and then backing off multiple times, the Argentine government has officially kicked itself in the balls by imposing a huge surcharge on visitors wanting to come spend their vacation funds in Argentina. They won’t call it a visa, but if you arrive at the Buenos Aires Airport, you will not be allowed to enter their country without coughing up a significant sum. For Americans it’s $131 per person, for Canadians US$70, for Australians US$100, all according to what the Argentines pay for a real visa from those countries.

They say it’s not a visa, so if it’s not a visa, what is it? I like to call it a “screw you surcharge,” while those running hotels and tourism businesses in the country are calling it a “screw us surcharge.” Either way, a lot of people are now bending over and it’s going to hurt.

This is essentially a way for the government to get back at countries with high visa fees by charging them the same amount to come into their country. Besides the fact that much of the U.S. cost is because of security and background checks and the Argentine one is simply going into someone’s pocket, there’s one major flaw in this approach. Argentina depends on tourism and gets lots of visitors from wealthier countries. The U.S. doesn’t even have a national tourism promotion board. If 100% of Argentines stopped coming to the U.S., Canada, and Britain, it would be a good year or two before the people keeping stats even noticed the blip. It certainly wouldn’t have an impact on the overall economy of any of those nations.

So it may put some money in someone’s coffers in the short term before word gets out, but what about after that? A friend of mine got a nasty surprise upon arrival, as I’m sure many have the past few weeks, and it’s the first thing she tells everyone when they ask about how her trip went. She and her husband had $262 less to spend on the ground than they expected after arrival. Long-term that’s a recipe for disaster. Peru, Uruguay, and Ecuador must have popped the Champagne when this news came out.

For now, there’s one good workaround: enter Argentina overland or via a flight to Mendoza instead of through the capital. The problem is, Chile, Bolivia, and Brazil have similar punitive fees in place (a big reason Argentina has, up until now, been more popular), so flying into any of those instead won’t solve the problem unless you were going to one of them anyway already. That leaves Uruguay as the best bet. If you can find a flight into there for the same or less than one to Argentina, take it and ride the ferry over. Or just avoid Argentina altogether until the tourism industry there cries “Uncle!” and the policy gets reversed. That could be a while though, as Argentina is not known for intelligence in government and the Kirchners have made enough boneheaded moves to fill a book.

To see the kind of reaction this announcement has brought, check out the 100+ comments after the story ran on the Argentine Post or the ones here on the Economist.

Look, I’ll be the first to admit we make it an expensive hassle to visit the U.S., but frankly, it’s just not important enough to our economy for the national government to really care. If the foreign tourism numbers dropped to zero tomorrow, only a few states (like California, New York, Hawaii, Florida, and Nevada) would even notice much of a drop in revenue. The rest rely on domestic travelers. So tit-for-tat moves like this don’t accomplish much, which is why others who have tried it (like Jordan) have ended up scrapping the idea when it became clear it was costing more than it was earning.

What do you think? Are you less likely to visit Argentina now that it’s this much more expensive? What about Bolivia, Chile, or Brazil? If you visited all four of these, it would cost you more than $500 before you even factored in actual travel costs on the ground. Ouch.

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