Argentina extended a multi-billion-dollar currency swap agreement with China Thursday, despite fierce opposition to the deal in Washington.
The cash-strapped South American nation extended the $5 billion accord with Beijing for one more year, securing much-needed foreign reserves.
The deal has become yet another front in a battle between Washington and Beijing for influence in Latin America.
A serial defaulter, Argentina has struggled to get enough foreign currency to pay off international debts while keeping its own currency stable.
Thursday’s deal gives Argentina access to more Chinese yuan in return for China gaining pesos — and influence, as a lender of last resort.
U.S. President Donald Trump’s top Latin America envoy Mauricio Claver-Carone recently described the swap agreement as “extortion” and said Washington wanted to see it ended.
The deal extension comes at a sensitive time.
Argentina is close to securing a $20 billion bailout from the International Monetary Fund.
The deal has already been tacitly approved by IMF working groups but will be considered by the board in the coming days.
China insists its own deal helps stabilize the Argentine economy.
“We call on the United States to get its perspective right and make more tangible contributions to the development of Latin American and Caribbean countries, rather than make an effort to drive a wedge,” China’s foreign ministry said this week.
The Argentina-China deal also comes as the U.S. Treasury announced that Secretary Scott Bessent will visit Argentina on Monday.
The US Treasury is said to be considering its own direct financing line for Argentina.
The Treasury said Bessent would “engage with both government and private sector leaders to affirm the United States’ full support for Argentina’s bold economic reforms.”
