Argentina Embraces Chinese Yuan to Tackle Currency Crisis and IMF Debt

Argentina, facing a severe shortage of US dollars, is now allowing commercial banks to open deposit accounts in the Chinese yuan. The move comes as the Argentine peso has plummeted nearly 80% against the US dollar since the start of 2020. The country has been increasingly using the yuan as an alternative currency, paying for imports from China in yuan and making a $2.7 billion payment to the International Monetary Fund in the Chinese currency. The shortage of dollars is due in part to a drought that has impacted the country's agriculture exports, leading to a decline in dollar reserves. The surge in yuan usage in Argentina has opened an opportunity for China to increase the global circulation of its currency.