During Argentine Finance Minister Sergio Massa’s May 29-June 3 trip to China, some media accompanying him reported that China’s three-year renewal of the $18 billion currency swap, including the $5 billion increase of the portion to which Argentina has free access, included a conditionality that the swap was dependent on Argentina maintaining its current agreement with the IMF. It turns out that is not true.
The daily La Nación reported June 3 that under the 2015-2019 government of neoliberal thug President Mauricio Macri, the Central Bank, run by one of his monetarist cronies, had included a clause in the swap contract with China stating that if the $57 billion standby agreement with the IMF fell through—an agreement Macri arranged with his pal Christine Lagarde—then the swap agreement would also. But in August 2020, under the government of Alberto Fernández, then-Finance Minister Martin Guzman eliminated that conditionality from the swap agreement.
Argentina’s Ambassador to China Sabino Vaca Narvaja confirmed this in remarks reported by El Digital on June 6. The agreement for the renewal of the swap, he said, “is now disconnected from the IMF.” The Macri administration “had tied the renewal of the second tranche of the swap to the standby agreement with the IMF,” with the expectation that if the deal collapsed, the People’s Bank of China (PBOC) would cut Argentina off. Now, Vaca Narvaja said, “it’s clear that that conditionality is disconnected.”
Moreover, he emphasized, at no time during Massa’s trip “was there any type of conditionality from China regarding what Argentina does with other countries.” That was a strong gesture, he said. China was stating “we are sovereign. We don’t accept any pressure.”
