Argentina’s La Rioja Province Creates Its Own Currency, the Chacho

The governor of La Rioja, Ricardo Quintela, has introduced a new currency, the chacho, to help alleviate the economic crisis in the province.

The chacho is named after Angel Vicente “Chacho” Peñaloza, a local legend who fought against the forces of Buenos Aires during the 19th-century civil wars. Each banknote features a QR code that, when scanned, displays a message criticizing the federal government for cutting funds to the province.

The chacho is pegged to the Argentine peso, with one chacho equaling one peso. Governor Quintela has encouraged shop owners to accept chachos as payment, promising that those who break the law will be closed. Traders can exchange chachos for pesos at government offices after a 48-hour wait.

La Rioja’s Economic Crisis

La Rioja is one of Argentina’s poorest provinces, with an average monthly salary of just $240. The province has been severely affected by President Javier Milei’s economic policies, which have led to a severe recession.

The province’s economy is heavily reliant on the state, with two-thirds of workers employed by the government. The state owns dozens of companies, including mines, vineyards, and glass manufacturers, which control a large part of the local economy.

Criticism and Concerns

Critics of the provincial governor have compared the introduction of the chacho to Venezuela’s economic crisis. Mariana Chanampa, vice president of a business chamber, says that the chacho is “a reflection of poverty” and that the situation in La Rioja is similar to Venezuela.

Denominations and Distribution

The chacho comes in denominations from 1,000 to 50,000. About three billion chachos, or approximately three million dollars, have been distributed, with plans to increase this amount to nine billion.

Precedent for Provincial Currencies

This is not the first time that Argentine provinces have introduced their own currencies. In the early 2000s, over a dozen provinces, including La Rioja, issued their own coins in response to federal austerity measures.

Federal Response

President Javier Milei has stated that he will not try to ban the chacho or offer to exchange it for pesos, in line with his liberal economic philosophy.