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Sergio Massa bets on US$ 8 billion in China to deal with currency volatility

2023-05-28T15:40:43.222Z

Highlights: Sergio Massa arrives in China just in the year of the Rabbit. The economy minister leaves this afternoon in the brand new presidential plane with a delegation of Head of State. It seeks to renew the swap. There will be a decisive meeting with Dilma Rouseff for more dollars. What will the Chinese ask him and what will they ask in return? It is known that there will be parallel meetings of Chinese and Argentinian authorities. It is not known what is on the agenda of Maximo Kirchner.


The economy minister leaves this afternoon in the brand new presidential plane with a delegation of Head of State. It seeks to renew the swap. There will be a decisive meeting with Dilma Rouseff for more dollars. What will the Chinese ask him and what will they ask in return?


Curious. Sergio Massa arrives in China just in the year of the Rabbit, and it is the minister who has been taking rabbits out of the galley, although less and less effectively in the face of the dynamics of a crisis that does not give truce. The year of the Rabbit means for the Chinese not to lower their arms in search of perfection that for that millenary culture is synonymous with harmony. Will the Minister of Economy achieve that harmony to arrive comfortably at least until the PASO?

Clearly the trip that Massa undertakes this afternoon at 16 from Aeroparque, premiering the brand new presidential plane with a delegation of Heads of State and accompanied by Máximo Kirchner, is not only to impress the Chinese, as diplomatic sources joke.

From politics they assure that Massa seeks the results that are elusive in Argentina to continue in what he aspires to, to be the presidential candidate. That will be finalized on June 10 at the congress of the Frente Renovador, they say.

Meanwhile, it is urged to renew the currency swap with China for US $ 18,000 million that expires next August and seeks to expand by 3,000 million in the amount usable for liquid reserves. Today that amount is US $ 5,000 million and would go to US $ 8,000 million.

In what is a two-pronged negotiation, Massa is very attentive to what happens in Washington. Those who are aware say that the White House, Argentina's main support in these negotiations with the IMF, advises to be attentive to what the Chinese ask in return, but that this does not distort what they have already defined which is to prevent Argentina from sinking. As for the advance of IMF funds, two former negotiators with good arrival told Clarín that there will be facilities but no money. And by facilities they understand that payments to the agency are stretched.

China's own situation, however, is good news for Massa. The giant is now emerging strongly from the pandemic with domestic consumption looking to catch up and high-speed growth exports. The last weekend of holidays mobilized about 200 million people, something that did not happen since 2018.

That is if the minister has already been warned that they are going to ask him about scandalous inflation. But for Beijing, Argentina can play a role in pressuring Brazil that is still slow to sign the ambitious Silk Road program that Alberto Fernández signed last year.

As for the BRICS and the aspiration to obtain a loan, the management is in the works.

Massa is betting that the bank that brings together Brazil, Russia, India, China and South Africa (BRICS) and where China has a key weight, lends him money. In fact, Article 7 of the institution provides for a contingency fund for countries with currency crises but it is only for members.

Dilma Rouseff has just taken office as president and yesterday she complained to Fernando Haddad, the Brazilian economy minister, that he was reluctant to attend the assembly that takes place this Wednesday in Shanghai. Although there are doubts that it is proposed to change Article 7 of the institution. They argue that if granted to Argentina, India could then ask for Bangladesh and other countries for other partners and friends. "They're going to be inflexible, they won't change it," one banker said.

Massa's agenda also has a high Energy component. On Tuesday he meets with the China Gezhouba Group Corporation (CGGC) for the dams of the Santa Cruz River, then with Power China, which will have as a common thread a battery of projects with financing. Also with CET - State Grid, which will address the objective of expanding the electric energy transmission system. And then with Tibet Summit Resources for the development of lithium together with other firms.

Hence, the delegation includes Diego Giuliano, Minister of Transport, Flavia Royón, Secretary of Energy and Agustín Gerez, the president of ENARSA.

It is known that there will also be parallel meetings of Miguel Pesce with Chinese finance authorities. And what is not known is what Maximo Kirchner's agenda will be.

Source: clarin

All business articles on 2023-05-28

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