The curious history of the exchange with China for 18.6 billion dollars

The first agreement of this type was signed in 2009 during the presidency of Martín Redrado within the BCRA, strengthen the reserves in the face of possible international crises and when the reserves reached the record of 15% of the GDP. In total, the agreement reached represented approximately $ 10.2 billion in three years., with the possibility of extending the duration. Redrado has negotiated with his Chinese couple, Zhou Xiaochuan, an agreement on a currency exchange that both countries could ask and which should then be repaid. The operating licenses for the BCRA were wide. The yuan can be converted into dollars on international markets or directly used for bilateral trade. Or, failing that, keep them in nominal reserves denominated in US dollars. However, over time, the instrument began to fade.

The second move with China was activated in the third quarter of 2014, during the management of Axel Kicillof in Economy and Juan Carlos Fábrega in the BCRA, for approximately 3.8 billion US dollars, transferred during the last quarter of this year. The novelty of this operation is that it was justified at the beginning of the works to lift the dam of Santacruceña Cepernic-Kirchner that the Chinese construction company Gezouba had awarded to a market in partnership with the local company Cordovan Electroengineering. The total agreement amounted to about US $ 11 billion, in successive regulations depending on the progress of the work. During the first half of 2015, a new disbursement was made for an amount of approximately $ 3.7 billion, for a total of $ 6.5 billion to date. Money from China arrived at an opportune moment to support the latest tranches of Cristina Fernández de Kirchner's government, while lack of dollars and ostracism in international markets were already worrying. Reserves amounted to about $ 30 billion and the possibility for Argentina to use international financial markets at reasonable rates was nil. The exchange renewal agreement with China came at an ideal time to preserve the reserves and deal with any losses before the end of the Kirchner government. By the end of 2014, approximately $ 3 billion in the agreement had already been used. In fact, some $ 2 billion of this funding was used to cancel the final payment of Boden 2015.

Then came the change of government and Mauricio Macri's decision to revise the Gezhouba contract for the construction of the dam still calls Cepernic-Kirchner. The first and public decision of the current government has been to freeze the work, under the suspicion of corruption and negative impact on the environment. However, in July 2016, they recalled in Buenos Aires, in July 2016, that some of the money for the work had already been spent (and not precisely to advance the dam), so that if the project was lifted, the money should be returned. . Thus, the conditions of the "swap" were "renegotiated"; the work came back to life under another name (hereafter, she would call Condor Cliff) and the "swap" would be reactivated. The mechanism has been renewed for about 11 billion US dollars, with a validity of three more years, with a yuan reserve of about 8 billion dollars. Last year, he again negotiated with Luis Caputo at the head of the BCRA, with another successive disbursement of about 10,000 million US dollars, an amount that now strengthens the reserves of the BCRA, despite the devaluation of yesterday. For the moment, it is not meant for the work of Santa Cruz, who is basically paralyzed.