§ Sir A. Bossom
asked the Chancellor of the Exchequer the rate of exchange which is now allowed as the basis of negotiation for purchases of meat from the Argentine; what currency is permitted; and what other rates of exchange are accepted by the Argentine for their other exports to this country.
§ Mr. H. Macmillan
At present, the effective rate of exchange for Argentine meat exports (other than pork) is about 13W 43 pesos to the £. This is the official rate less a 15 per cent. export levy. Pork is sold on the free market and the rate fluctuates. On 3rd July, 1956, it was 90.26 pesos to the £.
Under the recently introduced arrangements for multilaterally-based trade and payments, U.K. imports from Argentina may be paid for in any of the following currencies:—Sterling, Belgian francs, Danish kroner, French francs, Netherlands guilders, Norwegian kroner, Swedish kronor and Swiss francs. The rate of exchange for other export proceeds depends upon the commodity. Some qualify for the official rate of 50.4 pesos to the £ but may be subject to an export levy of up to 25 per cent. The proceeds of a limited number of exports are converted at the free market rate.
The following table gives the effective sterling/peso rates for Argentina's other principal exports to the United Kingdom to which the official rate and export levy (if any) apply:—
Commodity Export levy Approximate effective rate Per cent. Pesos per £ Oats, barley, maize, sunflower seed and ground nuts None 50.4 Other grain 10 45.4 Wool (scoured) 20 40.3 Wool (greasy) 25 37.8 Some animal feeding stuffs None 50.4 Other animal feeding stuffs 10 45.4 Hides and skins 25 37.8 Dairy produce 15 42.8 Linseed oil 10 45.4
These rates are subject to marginal variations, because a proportion of the export proceeds of most commodities may possibly be exchanged at the free market rate. This is because an official valuation is placed on such exports and the exporter is allowed to sell any excess received over this valuation on the free market and has to buy on the free market any foreign exchange needed should he fail to realise the valuation.
The same effective rates would apply in respect of these transactions if payment were made in any of the other permissible currencies.