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Sergio Massa raised $1 billion in China, but funds to expand pipeline in doubt

2023-05-30T16:43:10.780Z

Highlights: The minister obtained the commitment of investments from three companies.. June 15. Chinese President Xi Jinping turns 70 and is likely to celebrate at the workers' stadium in Beijing with the friendly match between the Argentine National Team and his idol Leo Messi against Australia. The 29-hour, two-stop flight on a plane that does not yet have Wi-Fi installed prompted officials led by Sergio Massa reviewing Henry Kissinger's memoirs about ping-pong diplomacy with China. The delegation that came from Buenos Aires divided the work, not only to attend to several fronts, but also to a task that is not easy in the face of an unpredictable Argentina.


The minister obtained the commitment of investments from three companies.


June 15. Chinese President Xi Jinping turns 70 and is likely to celebrate at the workers' stadium in Beijing with the friendly match between the Argentine National Team and his idol Leo Messi against Australia.

The choice of the date was no coincidence among the different options that Argentina tries in its desperate search for dollars, it could be called the diplomacy of football that consists of starting loans to strengthen reserves and for key investments that are granted to a government that will change in a few months.

In the brand new presidential plane that brought a large delegation in which Máximo Kirchner stands out and to which others such as YPF President Pablo González were added, there were several books about China.

The 29-hour, two-stop flight on a plane that does not yet have Wi-Fi installed prompted officials led by Sergio Massa reviewing Henry Kissinger's memoirs about ping-pong diplomacy with China.


Sergio Massa and a representative of the firm State Grid, which will invest in electric transport. Photo Ministry of Economy

On this afternoon in Shanghai, Sergio Massa, accompanied by Máximo Kirchner and the energy team composed of Flavia Royón and Agustín Gerez, met with the signing of the Gezhouba dams and signed an immediate disbursement commitment for the work for US $ 524 million, in addition to assuming with two Aysa plants -a treatment plant and sewage treatment- for US $ 70 million.

The round continued with State Grid, which finances high-voltage lines for the transport and distribution of electricity known as AMBA 1 and impacts 1.2 million people, in addition to consuming US $ 300 million.

In total, it could be said that on the first day of his visit to China, Sergio Massa reaped US $ 1,000 million that shortly, at the latest on July 1, will enter the reserves of the Central Bank.

But as for the financing for the expansion of the Néstor Kirchner gas pipeline, the result was elusive. Massa planned to request US $ 2,800 million from Chinese banks, Something happened that has now decided to call a tender in which Chinese companies will also intervene. This tender not only includes financing for a work of 562 kilometers that must be done in 10 months. They will also include the purchase of tubes and the work in its entirety.

"It is important to agree on issues that serve us for the present and especially for the future," Massa said in a brief meeting with reporters. The delegation that came from Buenos Aires divided the work, not only to attend to several fronts, but also to a task that is not easy in the face of an unpredictable Argentina. When some members of the delegation were asked what the Chinese were worried about, the answers were rather elusive.

Central Bank President Miguel Pesce is negotiating the renewal of swaps, that exchange of currencies for the equivalent of $18 billion that matures in August and that Massa wants to anticipate to bring some tranquility.

With the rise in international rates, these loans are now 25% cheaper than those obtained at the level of the Monetary Fund. But the goal is ambitious because Massa also intends to expand a line from 5,000 million current to 8,000 million dollars within the package of 18,000 million to be able to intervene actively in case of exchange rate volatility.

Pesce is working on this task with Marco Lavagna, and Massa will meet this Thursday with Dilma Rousseff, the new president of the BRICS Bank that brings together Brazil, Russia, India, China and South Africa.

That meeting is key because what Massa wants is that this bank also facilitates an agreement to strengthen the reserves of the Central Bank and thus arrive calmly at least until the PASO of August.

The issue is that the bank has a specific article, Article 7, whereby it cannot lend to those countries that are not members. Argentina is in the process of becoming so, but it is a process that will take several months. Massa and the economic team found a shortcut, which is for Brazil to increase its capital so that this money can be lent to Argentina. Dilma will do it.


Note in development

Source: clarin

All business articles on 2023-05-30

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