Argentina will pay for Chinese imports in yuan instead of US dollars, according to an announcement on Wednesday (April 26) by Economy Minister Sergio Massa. The decision comes at a time when the Latin American country is struggling with critical levels of dollar reserves, a historic drought, and a political crisis ahead of this year’s elections.
“Together with [Chinese] Ambassador Zou Xiaoli and entrepreneurs we are starting a swap with China, which will enable us to pay for imports from this country in yuan, thus replacing $1.04 bln in April and $790 mln starting May,” Massa wrote on Twitter.
“China continues to support Argentina in defending the sovereignty of its economy, which is why we are working on the swap, so that companies can use the yuan to reduce costs. We have been working hard and very closely to exchange information and data,” local daily Perfil quoted Chinese Ambassador Zou Xiaoli as saying during a meeting with Massa.
In 2022, Argentina expanded a currency swap with China by $5 billion. Last year, Argentina also formalized its application for membership in the BRICS. Despite not being a member, it has strong economic ties with some of the member countries, especially China and Brazil. This is an effort to diversify its trade and investment relationships beyond traditional partners like the United States and Europe.
Last month, Brazil’s Foreign Minister Mauro Vieira told the website Metrópoles that his country would like to have Argentina join the BRICS group but insisted that for such a move to happen it would depend on the consensus from the other bloc members (Russia, India, China, and South Africa).