Argentina Renews $19B China Currency Swap Until 2031, Defying US Pressure
On Wednesday, Argentina's central bank and the People's Bank of China (PBOC) finalized an extension of their currency swap agreement worth 130 billion yuan (approximately US$19 billion), just one day prior to the expiration of the existing deal. This new arrangement prolongs the agreement until 2031, marking a two-year extension beyond any prior renewals since the swap's inception in 2009. The decision concludes speculation regarding President Javier Milei's stance, who previously campaigned against dealings with communists and is now perceived as an ally of US President Donald Trump. The Argentine central bank emphasized that the extended term would enhance 'greater predictability over the continuity of this tool.' The swap allows Argentina to exchange pesos for yuan, which will count toward foreign reserves but cannot be utilized until activated.
Key facts
- Argentina and China renewed a 130 billion yuan (US$19 billion) currency swap.
- The extension was signed on Wednesday, a day before the existing deal expired.
- The new term runs until 2031, two years longer than any previous renewal.
- The swap was first signed in 2009.
- President Javier Milei had campaigned on a vow never to do business with communists.
- The US Treasury Department had offered a rival facility months earlier.
- The Argentine central bank said the longer term provides 'greater predictability over the continuity of this tool.'
- The full 130 billion yuan counts towards Argentina's foreign reserves, but none can be spent until a tranche is activated.
Entities
Institutions
- Argentine central bank
- People's Bank of China (PBOC)
- US Treasury Department
- Noticias Argentinas
- People's Bank of China
- Central Bank of Argentina
Locations
- Argentina
- China
- Buenos Aires
- Washington
- Brazil