Browsing Posts tagged Argentina travel

Argentina travel

Why did you leave me all these pesos instead of dollars?”

Getting ready to travel somewhere for a few weeks or months of independent travel? If you want a great value, put these countries on your short list:

Argentina

India

Indonesia

Mexico

Why these? Not because of their “friendly locals,” “charming towns” or “pristine beaches,” yada yada yada. And not because they’re a hot destination this year. You should go if you like to get a lot more for you money there than you did in the past. If you like traveling well while spending less than you do just existing at home, a plunging exchange rate is a surefire ticket to savings.

Most travelers approach exchange rates backwards. They don’t even think about them until they get to where they’re going, then fret about how everything is more expensive than they expected. It makes a lot more sense to see where your timing will be right and go there. Heck, even if you’re going somewhere expensive this makes sense: the pain of Canada, Japan, or Australia stings about 10% less right now than it did a year or two ago.

Argentina’s Pain, Your Gain

I took Argentina out of the last edition of The World’s Cheapest Destinations because high inflation, high import duties, and a slew of nutty economic policies were making it an unfriendly place for tourists. You’ll still face a hefty visa cost before you even exit the airport if you’re American and there’s still a crazy small limit on how much you can take out of an ATM each day. If you arrive with U.S. dollar wads in your pocket though, you are going to tango your way across the land in much better shape than even just a few weeks ago.

That’s because the peso has plunged badly for a whole host of reasons and the government’s injection of $115 million to buy up pesos isn’t helping much. Here’s how Reuters put it:

“The local currency weakened on the black market to 12.15 pesos per U.S. dollar, while the official exchange rate was unchanged at 8 per dollar in thin trading. Last week, the official peso slid nearly 20 percent as investors scrambled to make sense of the new currency regime.”

rupee decline

India’s Rupee in Decline

Two years ago this month, a dollar got you 50 Indian rupees. Today it gets you 62. That’s a 24% increase in what you get for your money. And you could already get a lot.

The government is intervening to try to keep this figure from falling further, mostly by raising interest rates. Who knows how well that will hold or not. But if you’re already planning on going there, happy days are ahead. (If you were going to Nepal, you’ll also get more for your money there, in what’s already probably the cheapest destination in the world. As the Indian rupee goes, so does Nepal’s currency.)

Let me take you to Indonesia

Two years ago a buck got you 9,000 rupiah. Today that same greenback will get you around 12,000. For those of you who flunked math class, that’s a 1/3 increase in your purchasing power. Maybe not in a chic Bali resort priced in dollars, but you weren’t planning on doing that anyway, right?

Indonesia was already one of the world’s best bargains, especially as soon as you leave Bali and head anywhere else. Yes, the country is getting wealthier and the middle class is rising fast—thus the horrible traffic jams in Jakarta—but if you stroll in with an ATM card linked to a bank account in a country that uses the US dollar, Canadian dollar, Australian dollar, euro, or yen, you’ll be feeling flush. Head to Sumatra and you can check out for months on a couple grand.

Unfortunately, the flight price is going to kill you for any of these if you’re coming from the USA or Canada, so it’s better if you’re already on the move and can get there from somewhere closer. At this time of year it’s hard to find a flight to any of the three for under $1,000, so sometimes you’re better off with a package deal that includes hotels.

Which leads us to the backyard choice:

Guadalajara

Mexico, Mexico!

I guess I moved back to Mexico at a good time. The exchange rate hasn’t dipped below 12 to the dollar since I got here this past summer and it just hit a new high of 13.3 when I took money out of the ATM yesterday. That means my “What you can get for a buck or less” list keeps expanding. Here’s a partial list

Two kilos of oranges or bananas, a large beer in a store, 12 ounces of fresh squeezed orange juice, a kilo of fresh tortillas, 2+ local bus rides, a few street tacos, a bootleg DVD, an ice cream cone or fresh fruit popsicle, a tamale, four breakfast buns, four sandwich rolls, y mucho mas,

A cheap meal of the day lunch in the market here is 30 pesos, which is now less than $2.50. A taxi from one side of Guanajuato to the other is less than $3. The average museum admission is $2 or less. As I always say though, those are prices in the real Mexico, not Cancun or Los Cabos.

Check flight prices here and go!


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Frida Mexican money

One of the most exasperating things a traveling person can deal with is having plenty of money to spend, but not being able to get to it. Or use it.

That’s not just a scenario for old movies where people used traveler’s checks and got an advance at the American Express office. It’s a reality in many countries today, including my new adopted home of Mexico. Sure, you can change dollars here just fine—as long as you only need to change $300 a day. And as long as you only need to cash $1,500 over the course of a month.

It’s a restriction put into place to curtail money laundering and nefarious trade from the drug cartels, never mind the collateral damage to the 20 million tourists who visit each year. And oddly enough, if you’re a drug dealer savvy enough to deal in euros or pounds sterling instead, no limits!

At least there’s a pretty easy way around it in Mexico though. Actually two ways: use a debit card instead of bringing cash and use a credit card when making major purchases like a hotel room or week-long car rental. Sure, there are still restrictions on ATMs from normal banking limits, but you can take out as much as you want in a month.

argentina atm money travelers

In Argentina, the situation is almost the opposite. In fact if you go to Argentina without huge wads of first world currency in your pocket you’re pretty screwed. That’s because the official rate is only about 2/3 of what you get in the black market these days—a sure sign that the economy is in big trouble there. On top of that, you can generally only get 1,000 pesos at a time from most ATM machines, which even at the official rate is less than $200.

Follow the link above and you’ll find ways around it, but many of them involve paying another fee each time. If you’re there for any length of time, you’ll need a credit card for big purchases.

In Burma/Myanmar, you had better come with entirely crisp and new U.S. dollars and you might want to encase them in the kind of folders baseball card collectors use in transit. As this Planet Money story on NPR pointed out, even the tiniest flaw or mark on a bill will make it worth less than face value.

Keep in mind too that many currencies have a built-in fee for foreigners (like the Cuban convertible pesos in Cuba) and many are practically worthless outside their home country. While the Thai baht is practically a hard currency in Cambodia or Laos, the Cambodian money is so useless you hardly even see it outside of local markets. Tuk-tuk drivers don’t want it and even the grocery stores post prices in U.S. dollars.

And if you ever want to see a backpacker come close to tears, ask them what it was like dealing with getting change and using torn banknotes in India

My advice? Read a guidebook well before leaving. Those paper things are still really useful and thorough resources, with real research involved. Then as soon as you arrive in a place that’s not part of the G-8, ask another traveler if there’s anything you should know about money and ATMs. Then sit back and listen for a while.

 

traveling on a budget

Southern Bolivia

A few years back I wrote an article for Transitions Abroad that I updated this month: Budget Travel in South America.

It’s not meant to be a comprehensive country-by-country rundown, but rather a strategy guide to where your money will stretch and what you can expect to pay in general terms. Then at the end there are some resources to turn to for more specifics.

Traveling on a budget in this region has gotten a lot more complicated since I did the first version of that article five years ago. Argentina has become a fiscal basket case again and on top of that they added a reciprocal visa fee that’s payback for what we charge them to enter our own countries. A family of four would now pay around $560 before exiting the airport. This same fee is in place in Chile, Bolivia, and Brazil, which is probably part of the reason those countries get far fewer visitors than Peru, Ecuador, and now Colombia.

travel Colombia

Cartagena, Colombia

If you watch financial news regularly, you’ll know that the resource-based economies around the world have been on a roll. Those that have lots of things to extract from the ground have seen their economies boom. In the developed world that means places like Canada and Australia. In South America it means Peru, Chile, and Brazil. Those latter two have gotten far more expensive when their currencies appreciate and Brazilians are now the free-spending travelers of the Americas, buying up a storm wherever they go. (And saving Argentina’s tourism industry in the process.) Colombia has been on a roll—too much of one actually. The government is frantically buying dollars to slow down the appreciation of its currency.

So where would I say you should go if you wanted to backpack through South America for a few months or more? I’d say you should fly to Central America first, because you can do it more cheaply with money or miles, then make your way through Panama and either fly or take a boat to Colombia. Spend a few weeks in semi-expensive Colombia, then go overland to Ecuador and watch your money instantly buy twice as much. (Except liquor and wine, which just doubled in price there this year.)

travelling South America on a budget

Chivay, Peru

You’d then continue down to Peru, hitting the highlights in a leisurely fashion from north to south, then enter Bolivia via Lake Titicaca. You’d make your way overland down to the Salar de Uyuni, spend some time around there, then bus it over to Salta in Argentina. Go overland to Iguazu Falls and then Buenos Aires, taking a detour to Uruguay somewhere along the way by land or ferry. Then take a series of very long bus rides down to Bariloche. Explore Patagonia there and in Chile, then fly up to Santiago. From there if you still have money left, you could spend some time in wine country and Valparaiso in Chile or fly to Brazil for some coastal time. Or head home, or back to Central America, or Mexico.

They key in all of this is to take your time! Distances between many of these locations are vast. Chile end-to-end is the distance of the west coast of the U.S. to the east coast, to give you an idea. These bus trips are so long you get a sleeping berth. You can cut off a lot of time flying, but domestic flights are no bargain except for a few routes like La Paz to Sucre. Trying to be a box-checking, bucket-listing, country-counting flashpacker is going to cost you far more money and part of your sanity.

For a country-by-country breakdown of these destinations and others around the globe, pick up a copy of the new 4th edition of The World’s Cheapest Destinations.

The February issue of Perceptive Travel is now out, fresh off our racking up a record six best travel writing awards from the North American Travel Journalists Association. We could just kick back and bask in the glow of our medals, but no, we’re going to keep cranking out interesting, unique, offbeat travel stories for your reading pleasure.

This month Bruce Northam takes us traveling around the Yukon Territory, a place the size of California that has 35,000 people. Want to reinvent yourself or start over? Leave your iPhone in busyland and head north to stake a claim.

Camille Cusumano last brought us the story of a hiker gone missing in Patagonia. This time she visits the seedy side of Buenos Aires at Feria la Salada, otherwise known as the Thieves Market. She won’t be going back…

Becky Garrison, author of Jesus Died for This? tries a pilgrimage to Glendalough in Ireland and finds that it’s going to take some effort to get away from the tourist hordes.

I cue up a worthwhile trio of world music from Brazil and central Africa, while Susan Griffith handles the travel book reviews: two on expatriate experiences in Europe, one with a travel quote for every day of the year +1.

Also we’re giving away a grab bag of travel gear goodies. The newsletter already went out, but you can still join us on Facebook to get in on the action. See the home page for details: Perceptive Travel.

 

You won't believe your calculator if you figure this one out. But nice ribbons!

Currency exchange rates can make a huge difference in prices where you are going. Travel prices fluctuate a lot because of this and the exchange rate can take a country from a decent value to being way overpriced in the case of just a few years. It’s happened to Australia, Brazil, Canada, and South Africa most recently, and plenty of others before that. Here’s what to keep an eye on in the current roller coaster climate of global finance.

At least consider a package deal for a short trip

The only true way to protect yourself from currency fluctuations, really, is to buy some kind of package deal in advance that removes all variables. You pay one price for everything (or close to it) and you don’t have to worry much about rates on the ground once you get there. It’s one of the main reason some people like cruises: they know everything they’re going to get and roughly how much it’s going to cost them. No adventure, but no surprises either.

If I were advising a relative on a vacation to Europe anytime soon, I’d definitely tell them to get a package tour. Ironic and annoying as it may be, that bundling often makes it cheaper than being an independent traveler: the tour agency is negotiating lower group rates on flights, hotels, transportation, and meals. I can do better than them in a cheap country by being smart, but it’s tough to do better in an expensive one that requires a long flight, like Italy, Japan, or Australia. (For example, Budget Travel’s website recently listed a 7-day tour of Copenhagen and Stockholm for $1,187 from NYC per person: flights, fuel charges, hotels, breakfast, and taxes. Try working that out on your own.)

U.S. dollar vs. Swiss franc, past two years

Avoid Switzerland for now

Switzerland has never been a bargain, but suddenly it’s up there with Japan for the title of most expensive destination. That’s because the inability for the U.S. Congress to act like adults when managing their budget led to a downgrade of U.S. debt. (Despite what some think, all budgets have two sides to the ledger: spending AND revenue.) That left the Swiss franc as the only currency looking rock solid. Which means lots of countries and investors are buying Swiss francs by the bundle. In a big country, this wouldn’t matter, but for tiny Switzerland, it’s a disaster. It’s made the value of their currency rise by a third.

Check out this PlanetMoney podcast if you want the whole story, but the bottom line is an already expensive place just got crazy expensive. Ski elsewhere this winter.

Where have we been before?

It makes lots of sense to check historic exchange rates here. Thailand has been at 40 baht to the dollar and it’s been at 30. Your perception of what a screaming bargain this country is will be a whole lot different depending on what the rate was when you were there. When I first visited Canada many years ago, 70 U.S. cents bought one loonie. Now they’re at par, with the Canadian dollar slightly higher as I write this. Some things already seemed expensive at the lower rate—like cigarettes, music, books, restaurant meals, and beer. So imagine how it feels now. On the other hand, Mexico at 12 pesos to the dollar felt a whole lot better than the first time I went there, when it was 10 to the dollar. If the rate is good now, or if it’s going through some crazy up or down move that’s out of the norm, you’ll know what to do, based on how badly you want to go there right now.

Are they tied to the dollar?

As noted in this recent post on how you would think Africa would be a cheap travel destination, but it’s not, where the currency is pegged to matters a lot. If it tends to follow the euro, that’s different than if it follows the dollar. This matters in Africa, it matters in the Caribbean, and it matters in Asia: in all these places one country may be following the Euro, while one right next to it may be following the dollar or even the pound sterling.

Which brings us to Latin America. It used to be that all these countries moved in lockstep with the U.S., so the rates barely budged. That’s still true in some that use the dollar (Ecuador and Panama) and others that might as well, they track it so closely (like Honduras and Belize). There are a few outliers though, resource-rich countries with booming economies that are floating their own boat on the international exchanges, most notably Brazil and Chile. It’s been a good while since either of those were a bargain—though Chilean wine remains a fantastic value. And you should have lots of Brazilian music in your collection, of course.

Overall though, in a world of uncertainty, these are your best bets for stability for those making their money in U.S. dollars. These economies are strongly tied to the U.S. and their people are getting lots of remittances from relatives working there. Huge spikes or declines in the exchange rate don’t do anyone any good. So “steady as she goes” seems to be the mantra. You won’t get any big nasty surprises going to any of the Latin American countries profiled in The World’s Cheapest Destinations.

Here’s a chart on Argentina though, for comparison purposes. It’s not as dramatic as it seems if you look at the change in percentage terms, plus inflation there has eaten up much of the gain. And now the government is charging you $140 before you even leave the airport. Even factoring in all that though, it’ll certainly cost you far less than the country profiled in the other chart above. That’s really the key point: keep it all in perspective because the cheapest destinations will usually still be a better value than the most expensive ones, no matter what kind of European meltdown, Asian currency crisis, or political posturing in the U.S. is going on.

 

Argentina travel

Dollar vs. Argentine peso, past two years