With the adhesion of Argentina, South America begins the process of de-dollarization of foreign trade
Published 4/28/2023 11:26 AM | Edited 4/28/2023 3:53 PM
Argentina will pay for imports from China in yuan instead of dollars. The government announced on Wednesday (26) that the de-dollarization means the strengthening of trade ties between the countries. Argentina and Brazil are taking the first steps towards commercial independence from the US currency.
According to a statement from the Minister of Finance, Sergio Massa, still in April, Argentina intends to pay the equivalent of US$1 billion in imports from its Asian partner. For the minister, transactions can reach around US$ 800 million a month.
The bilateral agreement works with the possibility of increasing the import volume of Chinese products.
Brazil and Argentina take the first steps in the discussion about the hegemony of the American currency in global trade. In January, on his first presidential trip under the new government, Lula discussed with Alberto Fernandez the possibility of creating a common currency for commercial transactions between the countries.
In April, China and Brazil signed an agreement that promotes commercial direct exchange transactions between the real and the yuan. By excluding the dollar, Brazil and Argentina intend to reduce trade costs, promote bilateral trade and facilitate investments.
More than 25 countries already trade with China using the yuan.
Recently, Bloomberg published an article saying that the “dollar king” is facing an uprising. According to the magazine, countries are “tired of a currency that is too strong and has been turned into a geopolitical weapon”.
On a trip to China, the Brazilian president proposed the creation of a new monetary system for the restricted use of the Brics – a bloc of emerging countries formed by Brazil, Russia, India, China and South Africa.