Chinese currency
The Central Bank of Argentina (BCRA) received yesterday the equivalent of US$814m in Chinese yuan, as part of a currency swap agreed with the Asian country in July.
The Chinese Central Bank notified its Argentine counterpart yesterday that the deposit had been made in the BCRA’s account in Hong Kong, and that it would be credited within the same day. In return, Argentina transferred the equivalent amount in Argentine pesos —approximately $6.9bn, according to daily Página 12.
With this swap, the BCRA incorporates yuan to its reserves, which consist mainly of US dollars, as well as euros, British pounds, and gold. In a statement describing the operation, the BCRA said the yuan is “well on its way to becoming one of the main reserve currencies in the world.”
Argentina will use part of the money in its Hong Kong account to pay for Chinese imports for infrastructure works —such as a dam in the province of Santa Cruz— and to purchase new rolling stock for its railway lines. The BCRA can also choose to request further deposits within the total amount agreed for the swap, which is the equivalent of around US$11bn.
The currency swap agreement was signed between the governments of the two countries on 18th July. With the Chinese deposit yesterday, the Central Bank reserves reached just over US$28bn.
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