Currencies Swap Agreement Between Brazil and Argentina Postponed to August

Argentinean peso
Brazil and Argentina postponed the signing of a US$ 1.8 billion swap agreement that was supposed to promote bilateral trade amid the global financial crisis. Reasons for the delay were not revealed but the event was rescheduled for August 3.

The agreement was to be signed during the Mercosur two-day presidential summit in Paraguay.

Brazilian officers suggested delaying the signing since Argentina's new Economy Minister Amado Boudou took office only a few days ago. Boudou had a bad start at the summit: he arrived late to the ministerial meeting in Asuncion and contrary to all his peers was unable to come up with estimates of the Argentine performance for the rest of the year.

In Buenos Aires press reports indicated that it was necessary "to recalculate the swap involved to avoid confusion." The agreement at Central banks' level included the exchange of credit lines up to 3.5 billion Brazilian Reais or its equivalent of 6.5 billion Argentine pesos, in the range of US$ 1.8 billion.

The agreement would have an initial trial period of six months and future amendments would be determined by presidents of both central banks. Argentina's foreign exchange reserves stand at US$ 46 billion and Brazil's US$ 208 billion.

Brazil is Argentina's main trade partner. Both countries have seen the volume of foreign trade drop as a consequence of the global crisis and are interested in using local currencies to further stimulate bilateral trade.

However in spite of the "strategic alliance" between the two leading economies of South America and senior members of Mercosur, Brazil has threatened to take Argentina to the WTO for imposing non tariff barriers to trade. In an effort to overcome the situation both countries have encouraged private sector negotiations to find a way out to the dispute.

Mercopress

Tags:

You May Also Like

Bolivia Pays Brazil for Oil Plants and Fines It for More than Buyback Price

Bolivia took control Tuesday, June 26, of two refineries it bought back from Brazil's ...

Helping Hand

By Brazzil Magazine What is being done to help favela residents in Brazil and ...

The day after

Thanks to the wonderful potions prepared by Loira, Loira and Roque postponed old age ...

World’s Leading Cardiologists in Brazil to Prevent Heart Disease

Heart disease and stroke cause four times more deaths in mothers in most developing ...

Brazil Exports and Imports to Arabs Grow to About US$ 1 Billion

Exports from Brazil to the Arab nations grew 58% in July when compared to ...

Brazilian Indians Get a Hawaii in Land But May Go to War Between Themselves

It’s been a year since the Brazilian Supreme Court awarded definitive ownership (homologação) of ...

Middle East’s Index Fair Showcases 36 Brazilian Companies

Index, the largest accessory and decoration fair of the Middle East, should count on ...

Monetary Easing in US Brings Record Day to Brazil’s Market

Latin American stocks powered higher, led by Brazilian shares, on indications the U.S. Federal ...

Brazilian President Luiz Inácio Lula da Silva

Lula Brought Poverty Down in Brazil, But Safety, Education and Health Are in Shambles

On Sunday October 1st, 2006, more than 120 million Brazilians will head to an ...

Brazil’s Tim Offers Turbo Mail

TIM Brasil has launched TIM Turbo Mail, a new service that enables  customers to ...