China suspends US$6.5 billion currency swap agreement with Argentina, reports say
- Freeze comes as new Argentine President Javier Milei, who campaigned on breaking ties with China, faces financial challenges
- As Buenos Aires considers shifting more toward the US, Beijing might exert more economic pressure, analyst says
China has suspended a US$6.5 billion currency swap agreement with Argentina, and the freeze remains in effect until President Javier Milei demonstrates a clear intention to engage with Beijing, Argentine media have reported.
News of the move comes just 10 days into the tenure of the new president, who campaigned on breaking ties with China, and underscores the challenge Milei will face in trying to follow through with those pledges.
Asked to comment, Zhicheng Xie, the spokesperson for the Chinese embassy in Argentina, declined to confirm the reports.
In Beijing, Chinese Foreign Ministry spokesperson Wang Wenbin also refused to confirm or deny the reports on Wednesday, only saying that China remained committed “to cooperation with Argentina on the basis of equality and mutual benefit”.
The funding is part of a deal renewed annually since 2009, crucial for Buenos Aires due to its negative holdings of international dollar reserves. Argentina has relied on such swaps as one of its few credit options, given the South American nation’s reputation for defaulting on international debt.
