Argentina Consolidates Belt & Road Membership With Construction Plans
The Chinese and Argentinian governments have signed a cooperation plan to promote the construction of the Belt and Road Initiative, according to China’s National Development and Reform Commission (NDRC) in Beijing.
The NDRC said that the plan will fully implement the significant consensus reached by leaders of both countries on promoting the high-quality development of the initiative and deepen collaboration on areas including infrastructure, energy, economy and trade, finance, and culture. More detailed explanations of what this means for Argentina and the Latin American Mercosur trade bloc, of which Argentina is a primary member will no doubt be introduced shortly.
The two countries are drawing closer in their relationship and recently agreed to drop US dollar usage in their bilateral trade, which is currently running at about US$1 billion a month. Trade settlement will be made in RMB Yuan instead.
Argentina has also applied to join the BRICS grouping, where its fellow Mercosur partner, Brazil is a founding member.
Argentina is also a major Latin American economy. However, its currency, the Peso, has dropped 44% against the US dollar over the past twelve months while inflation has reached levels of up to 70%. Washington has declined to intervene despite it being the countries third largest export market as a depleted Peso makes its imports from Argentina less expensive. China is Argentina’s largest trade partner. however.
Argentina engaged in a US$7.2 billion currency swap with China in January this year, seeking to strengthen Argentina’s international reserves.
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