General Comments & Banter, page-7063

Absolutely NOT.

The Argentine Peso has devalued some 30% against the US% during August and as of last night our time interest rates have been increased to about 60% purely as a measure to support the exchange rate which would reduce capital outflow from Argentina (the exchange rate falls because more money is leaving the country than what is coming in).

The high interest rates will affect their domestic businesses and in the short term will weaken economic growth.

Argentina is seeking to borrow a bailout package from the International Monetary Fund (IMF) to stabilise confidence and economic activity. They will get funding and things will settle.

However, AGY is an based Australian company with "mining " operations in Argentina therefore domestic issues should have little negative impact if at all . Rather there will be some positive impact , as AGY moves towards production of Lithium , in that cost of labour will be price competitive. As I see it AGY will have little exposure to Peso payments/Receipts as the bulk of its foreign Exchange exposure will be A$ to US$ or maybe A$ to Japanese YEn , and given that both the US$ and Japanese Yen currencies are strong currencies relative to the A$ , AGY will receive more A$ for their Li exports (which will likely be denominated in US$ or JPY , or both).

As I mentioned in my other posts in the last couple of days the incumbent Argentine Government or any other party that may win office , in order to re activate economic growth , stabilise their currency and meet their commitments in servicing their Borrowings from the IMF they will need to protect and encourage mining and exports of their resources , much like Australia.

Argentina's best way to grow their economy is to encourage more investment from foreign counties . They will need to bend over backwards in order to encourage foreign investment.

Argentina went through a similar economic turmoil in the 1980's and came out of it at the other end. To me this current economic upheaval in Argentina is more beneficial for AGY than otherwise it would have been.

Am totally relaxed about the current events in Argentina


AIMHO
DYOR