"I'll Trade You a Baby Crib for a Buzz Saw"

With Argentina's economy sinking, barter is a way of life

Cristina Cerdero has little idea what she will earn each week. Four months ago, the 36-year-old mother of eight lost her cleaning job at a university. Now she works long hours making pizza at a market in Bernal, a working-class neighborhood on the outskirts of Buenos Aires. Mind you, Cerdero doesn't sell her pies--she swaps them. "A friend told me about this place three months ago, and I've been cooking pizzas here ever since. You can trade anything here, food, things for the house, clothes for the kids," says Cerdero as she kneads dough to feed a line of hungry customers.

With the domestic economy mired in a seemingly endless recession and unemployment hovering near 15%, a growing number of Argentines are falling back on the age-old system of barter. Government officials estimate that some 200,000 citizens supplement their incomes through barter, or trueque; private sources say the true figure is closer to 400,000. With 800 trueque clubs scattered throughout the country--double the number a year ago--barter has become a $400 million business in Argentina.

Since it was launched six years ago, membership in the Barter Club of Bernal has soared. Three times a week, thousands of residents assemble in a vacant city block to swap everything from pasta to plumbing. Wooden stands display tools, clothes, fruit, vegetables, or pots of homemade soup. Among the regulars is Susana Cachón, a 57-year-old grandmother who trades her hand-knit sweaters for food. "When my husband lost his job, it wasn't possible to make ends meet," she says. "Barter helps us eat."

While most goods offered at the Barter Club of Bernal are small-ticket items, Argentines are increasingly turning to trueque on a grander scale. Local newspapers carry advertisements for washing machines, cars, and apartments, all available on a barter basis. Several barter clubs have also set up their own Web sites, so that members can promote their wares electronically, instead of having to rely on printed flyers and word of mouth. Even small businesses are getting into the act. A hotel chain based in Buenos Aires offers lodging in exchange for cleaning supplies and bedsheets, while one commuter bus company gives out tickets in exchange for having its vehicles painted.

Surprisingly, Argentina's cash-strapped government is eager to give barter a boost, even though such transactions are tax-exempt by law. "Barter is already popular and is going to become more so. We need to do more to promote it," says Enrique Mario Martínez, who heads the department for small and midsize business. Officials are well aware that barter provides some sort of cushion for the jobless. And they are also eager to nurture citizens' entrepreneurial drive. With that goal in mind, Martínez organized a one-day fair in Buenos Aires in mid-March to showcase the barter trade, an event that drew 25,000 visitors.

FUNNY MONEY. The government also agreed last year to permit barter clubs to issue an alternative currency, known as créditos. The scrip makes it easier for club members to "buy" goods and services from each other, especially when the products they are offering do not necessarily match what the other party wants. Until recently, the paper coupons, which are available in denominations of C$1, C$5, C$10, and C$20, were considered legal tender only within the confines of the barter markets. Yet thanks to a March ruling from Argentina's tax department, an assortment of businesses, including law firms, bus companies, auto repair shops, and psychologists, have begun accepting créditos as payment.

For some Argentines, trueque is not just a way to put food on the table--it's a way of life. That's certainly true of Floreal Medina, a former businessman who travels the country helping extend the barter network. "In the [barter] system, people are recognized for what they do more than what they have," he observes. Medina says he has journeyed 12,000 km in the past year without spending a centavo. "At times, I didn't have enough money for a little souvenir, but I could find people in the trueque clubs who would help me out," he recalls fondly. And in Argentina these days, people need all the help they can get.

By Colin Barraclough in Buenos Aires

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