Currency swap between China and Argentina
2023.01.08 11:04
Currency swap between China and Argentina
Budrigannews.com – The Argentine central bank announced on Sunday that the expansion of a currency swap agreement between China and Argentina has been formalized, allowing the South American nation to replenish its depleted foreign currency reserves.
To cover trade costs and future debt repayments, Argentina’s government needs to rebuild reserves. Increasing reserves is a key goal of a major debt deal with the International Monetary Fund (IMF).
In November of last year, President Alberto Fernandez made the announcement about the deal, stating that it was worth $5 billion at the time.
In a statement, the Argentine central bank said that the heads of the Chinese and Argentinean central banks “confirmed that the deal for the swap of currencies between both institutions has been activated and committed to deepening the use of” in the Argentine market.
After Brazil, China is Argentina’s second-largest trading partner and the second-most significant destination for exports.
The statement stated, “The swap comprises the exchange of currency for strengthening international reserves of 130 billion yuan and a special activation of 35 billion yuan to compensate operations on the foreign exchange market.”
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