The first of the swaps between Argentina and China was agreed in 2009, for 70 billion yuan, which was later followed by extension and complement agreements in 2014, 2017, 2018 and 2020.
The swap is a currency exchange between two countries; in practice, it acts as a kind of contingent loan.
As long as it is not activated, it has no cost, but is accounted for within the international reserves and it is available to be used immediately in the event of a currency crisis.
When this is used, the swap is agreed according to the Shanghai interbank rate, the Shiborthat actually close to 6% per year.
Cerruti indicated that the aim is not only to increase the amount, but also “study the possibility that it can be used for other issues” and not just an “accounting entry, which is the use it has at this time”.
To this end, the Government is “conversing with the corresponding organizations, to see what other types of uses can be given to this extension of the swap”, the official pointed out.
Source: Ambito
David William is a talented author who has made a name for himself in the world of writing. He is a professional author who writes on a wide range of topics, from general interest to opinion news. David is currently working as a writer at 24 hours worlds where he brings his unique perspective and in-depth research to his articles, making them both informative and engaging.
