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Its been like this for quite a while, its to combat people in cheaper regions acting as a store and selling games. he can easily send you a gift card instead as those are not restricted.
Without it someone in a cheaper region would set up a store offering a $70 game for $40 because it costs $30 in their region.
This is the classic case of "bad actors spoiling a good system". I would love to gift some games to some dear friends I have on Steam that are from other countries, but I simply can't do it anymore. The closest possibility is buying a digital Steam Wallet card, but it's far from the same thing.
It would be nice if some day we could gift games for people on other countries while paying the monetary difference to reach the price charged on that country. Of course it would be more expensive (when gifting to someone who lives in a country where games are more expensive that is), but it could be an alternative that some people would use eventually.
Last, but not least: users from countries that pays more for games on Steam can gift them to other users from poorer countries. For instance: someone from the United States can gift a game to someone from Brazil, but not the contrary (just like someone from Australia can send gifts to United States, but not receive gifts from them). I've been there, and it feels awful not being able to gift a game in return.
Is that what having friends on here means? having people in your friends list to gift you games and gift cards?
Also, your friend could just gift you a Steam Gift Card through Steam. They could just send you the money to get it, since they can't gift you the game themselves.
https://store.steampowered.com/digitalgiftcards/
Edit: and if it's supposed to be a birthday gift, getting money is even better.
Totally lost on me.
Again nothing to do with the country, it's based on the price of the item