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Latin America Embedded Finance Business Report 2024: A $41.4 Billion Market by 2029

Argentina’s inflation and a propped-up peso have had a significant impact on a border town in Paraguay. Once a bustling hub for cheap imports, Nanawa is now a ghost town due to the weakening peso and high inflation rates in Argentina. Since President Javier Milei took office in December, sales in Nanawa have dropped significantly, with some shopkeepers reporting plunges of up to 80%.

The Argentine peso has been steadily depreciating, leading to soaring prices in dollar terms. This has affected both tourists and exporters, with the cost of goods becoming less competitive compared to neighboring countries like Uruguay and Chile. In April, the price of beef in Argentina nearly doubled, erasing the cost advantage it once held.

The shifting trend has also led to a decrease in demand for Argentine imports in border towns like Nanawa. While some may see this as a positive development, it has meant fewer opportunities for locals to find bargains in Argentina. Supermarket employee Raquel Alvarenga has noticed the changes firsthand, with traffic in the store drastically decreasing.

Despite the challenges, Alvarenga is adjusting to the lack of shoppers and finding time to relax during work hours. While the situation in Nanawa may be tough for businesses, it reflects the broader economic struggles facing Argentina and its impact on its neighboring countries.

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