China Seals $10bn Argentina Swap Pact

The People’s Bank of China and Central Bank of Argentina Wednesday announced the formal signing of a CNY70bn/ARP38bn ($10bn) bilateral currency swap arrangement. “The effective period of the arrangement will be 3 years, and could be extended by agreement between the two sides,” say the pair in a joint statement. The contingent line incurs interest only when used. “The yuan is not part of the central bank’s international reserves, but it could, eventually be used to facilitate financial operations in which counterparts require such currency,” says the Argentine bank. It adds that the arrangement can only be used to strengthen each economy. The only country Argentina accepts foreign currency from for trade is Brazil.