Argentina Heads To China For Economic RESCUE As Farm Outbreaks Devastate Export Revenues

Argentina Heads To China For Economic RESCUE As Farm Outbreaks Devastate Export Revenues

all right guys so Argentina is having a
moment of repentance for many months now
M has been distancing the country from
China the first was rejecting the bricks
invitation he rejected the block saying
there was no value there m has also
mentioned that he doesn’t want to work
with China he wants to work with the
Democratic world and that of course
means the US and the west but here’s the
hilarious part M officials are heading
to Beijing for economic rescue Argentina
Central Bank Chief and the for Minister
monino are heading to China to seek help
and yes is recuring the economic
Lifeline the 18 billion currency swap
line with China it’s important because
Argentina is still in a big financial
crisis that’s why monino met with the
Chinese Ambassador here mle wants to
dollarize Argentina he wants to bring in
foreign investment and grow the economy
to do that he can’t afford to cut away
China decoupling simply isn’t possible
the biggest problem Argentina faces
today is still inflation people’s buying
power is evaporating and there aren’t
enough US Dollars circulating in the
economy Argentina’s monthly inflation
might have slowed down but it’s still a
clear and present danger their March
inflation came in at 11% a month prices
still Rose by double digits in a single
month twice the national average at 11%
within 6 months prices double and that
means a loaf of bread that cost $5 will
hit 10 bucks half a year later and if
that’s not a national emergency I don’t
know what is by August inflation is
estimated to hit at insane 321 per. and
there’s no guarantee it will come down
the dollar is getting stronger plus
Energy prices aren’t coming down fast
enough the issue now is social stability
where the your currency keeps dropping
people are pushed to the brain and if we
look at the numbers it’s truly
disastrous poverty in Argentina has
reached
57.4% in 2024 so 6 out of 10 people are
living in poverty even mle has admitted
to this and his shock therapy will make
things worse at least in the short term
m is facing two horrible crisis at the
same time now the US dollar shortage is
just a symptom if you break things down
Argentina is spending too much and they
un earning enough from the world their
exports aren’t growing fast enough and
just like your personal budget saving
money is always easier than trying to
earn more money and this is where melee
went all the way pedal to the metal just
like last month he boasted of spending
cuts literally everywhere and it’s
massive Public Works were frozen funding
to provincial governments was cut and
200,000 social welfare programs were
terminated is basically demand
destruction cut away the supply of money
and people are too broke to spend now
that’s all well and good cutting
spending is great but you must increase
government earnings as well and that’s
Argentina’s biggest challenge they are
struggling to boost exports to the world
if we look at Argentina’s balance of
trade is starting to show signs of Life
there have been budget surpluses for 4
months in a row it even reached over 2
billion in March and on the surface this
looks good however the Surplus is coming
more from demand destruction than export
growth in the first quarter of this year
their exports grew by only 9% however
their Imports fell by over 24% this
isn’t good for the economy especially
when there are ton of layoffs people now
have to compete for a small pool of
goods coming into the country but this
struggle is going to get harder an
outbreak of leaf Hopper swamps is
threatening Argentina’s crops and
economic recovery and this just came
after recovering from the drought Corn
Growers are suffering big losses in
their crop yield and the disaster isn’t
over yet Argentina is the third biggest
exporter of corn to the world so heat
here will be substantial this export is
vital for M to stock power the reserve
currency and these are dollars needed to
pay back Bond holders to prevent
Argentina from defaulting yet again
because of this outbreak con exports are
going to Tumble the original forecast
was nearly 57 million tons of production
but because of the infestation output
could Collapse by 12% or more production
is estimated to fall to 49.5 million
tons for the year but that’s just a
conservative estimate in many acres of
Farmland yields expected to plunge by at
least 30% obviously exports will be hit
but the biggest blow will be to the
farmers margins for farming especially
in Argentina are notoriously low export
taxes are already at 12% and just to
export the produce Farmers need to pay
an incredibly High tariff to the
government and with this Insight
outbreak Farms are going to lose a lot
of money in the ftown province of
cardoba production is 26% lower than
last month and the cash losses have
exceeded $1 billion and this is a very
serious issue if Farmers keep losing
money operating their Farms this could
force them to shut everything down that
will cause Argentina to lose export
volume when they are surrounded by
countries that agricultural Giants as
well Brazil is one very good example
unlike mle lady L is smiling at Lula
Brazil’s com production Will Rise by 6%
in 2024 so whatever market share
Argentina loses it will be filled by
Brazil other producers like the US and
China are also growing production this
is bad news for Argentine export
their biggest exports are corn and
soybean and all these are weather
dependent Commodities and it’s
impossible to control the weather to
control the Harvest is very different
from mining metals or oil production and
that’s why Argentina needs China on the
export front Beijing is a huge importer
of corn China produces their own corn
harvesting over 280 million tons last
year but their consumption their
appetite is voracious as you can see
from the red line their overall Imports
are starting to rise as the middle class
in China grows so does the demand for
food around 8% of Chinese demand is met
with food brought into China and this
dependence on Imports will only grow and
this represents a huge market for
Argentina it’s a market currently
dominated by Brazilian and US suppliers
to China and that’s why a large
Argentine delegation is heading to
Beijing it’s all about trade it’s all
about rescuing their economy we must
understand how important China is to
Argentina especially the swap line from
Beijing M can’t control the weather so
there’s no direct way to boost exports
to the world but Imports still have to
come in and he doesn’t want to pay in US
Dollars Argentina has an urgent mission
to renew at least $5 billion from the
sof line and mle has to renew it orio
face a very big crisis now swapline is
simple Argentina gets to exchange their
pesos which is inflating away for the
Chinese Yuan a more stable currency they
can then use the Yuan to buy import from
Beijing because obviously China accepts
their own currency over the past 12
months the Yuan has appreciated by 280%
against the peso in other words the peso
collaps against the Yuan so China gave a
more valuable currency to Argentina in
exchange for pel they inflating away
like crazy and I call it the Yuan for
toilet paper deal but because it’s a
swap Argentina needs to return the Yuan
to China and this is coming as soon as
June or July but just like dollars where
is melee going to get the cash from the
yuan is nearly 300% Stronger versus the
Peso today he will have to devalue his
currency even more to pay back Beijing
and this why Argentina needs China to
extend swap line to delay the repayment
of the U want it’s just like you heading
to the bank asking for extension on your
loan and that’s how dire the situation
is according to analyst even with
China’s currency swap a peso plunge and
hyperinflation are risk without they are
close to a certainty and this is where
the rubber meets the road where melee
needs to face economic reality he still
needs the help of Beijing and a big
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Journey today China’s the fourth biggest
buyer of Argentine products they come in
at
7.9% just below the US EU and Brazil but
when it comes to Imports it’s a whole
different story China accounts for
nearly 20% of the total Imports flowing
into Argentina and these are vital
inputs to the Argentine economy and this
includes computers electronics and
chemicals needed to make fertilizers
they aren’t bringing in luxury cars of
vintage wine Beijing is providing the
equipment and the inputs needed to run
the Argentine economy and if you didn’t
know mle loves to burn Bridges he’s
trading insults with Brazil according
president Lula communist many times and
Brazil is Argentina’s biggest trading
partner it’s very counterproductive
Brazil has had enough and they even
demanding Mal’s apology so it’s not just
the economy that’s in trouble but
diplomacy as well mle just can’t afford
to cut China away he needs all the
Chinese Imports and if we look at the
numbers it’s really staggering Argentina
has a trade deficit of $9.2 billion with
China in other words they importing over
9 billion more from China than they
export out in 2023 they total Imports
came in at $14.5 billion worth and let’s
just focus on this headline figure
because these are imports from China Bay
now has a choice he can either pay for
the Imports in dollars or use the
Chinese Yuan to bring in the goods
paying in Yuan now is the smarter Choice
Argentina has a shortage of dollars the
only way to get more is to earn it
through their exports and that takes
time and what do we have Argentina
facing a farming crisis today and that’s
why China’s swap line their lifeline is
so vital it allows Argentina to get the
Chinese currency instantly and buy the
Imports needed and considering China
exports deflation today buying from
Beijing means paying less for more and
let’s recall M’s fantasy he wants to
dollarize the entire economy he wants to
tear down the central bank and replace
the peso with the US dollar but to do
that he needs a surplus of the reserve
currency circulating around Argentina he
can’t afford a massive outflow of
dollars for his Imports and that’s why
he can’t let go of China swap line I’m
sure he can’t stand it but this is
financial reality for Argentina to
dollarize their economy and break away
from China mle needs the help of China
it’s crazy but it’s true China’s biggest
swap line is with Argentina compared
with other countries like Pakistan Egypt
and turkey Argentina has a 20 billion
facility with China and that’s enough to
cover the entire yearly imports from
China without using a single dollar
that’s how important the swap line is it
helps melee to preserve precious dollars
to circulate around his economy you can
even use the Yuan to pay back the IMF
loan they did it back last year when
their dollar reserves were drying up so
this is a Lifeline thrown to Argentina
without this m can’t amess enough
dollars to make his dream come true he
needs the swap line from China there are
a lot of bizarre things happening in the
country mle just sealed the deal for us
fighter jets Argentina will spend $300
million to buy 24 F-16 Jets from Denmark
so it’s cutting away subsidies and jobs
to buy fighter jets it seems very
bizarre to me I just can’t comprehended
and here’s the juicy part to help with
the purchase of the Jets the US is
giving Argentina $40 million in foreign
military financing now I’m not sure if
this is a gift or loan but one thing’s
for sure Argentina is moving closer and
closer to the west but let’s end this
with inflation it’s still the biggest
problem facing Argentina to dollarize
the economy mle has to devalue the peso
more he must create a unified exchange
rate for the country subsidies are going
to end in three years and dollarization
is still the end goal so he’s in a Time
Crisis to solve the inflation crisis but
in the short term you will likely get
worse before it gets better the official
exchange rate is 850 pesos to the dollar
and that’s the line in rate but the Blue
Chip or the black market rate is well
above 1,000 pesos to the dollar there’s
still a 23% gap between the government
rate and what’s happening on Main Street
sooner or later this Gap has to close to
dollarize the country which means
another round of currency devaluation is
coming people’s purchasing power will
get hammered once again is a big reason
why M’s delegation is hitting to China
if the swap line gets cancelled he have
to pay back a huge amount of Yuan to
Beijing financing Imports outside of the
dollar will get more difficult if not
impossible and to boost exports that
will bay needs the power to control the
weather and influence insects so it’s
not exactly the best conditions for
Argentina today Havier M will need to
pull on all levers to save the economy
he might not like China but he has no
choice the song and dance must continue
so let me know what you think in the
comments below will China help Argentina
out again and is mle doing a good job of
saving his country let me know in the
comments below stay safe be sure to
smash the like button and subscribe as
we navigate through these crazy times

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Argentina is facing an export crisis. With inflation still raging, an outbreak in their corn harvest threatens to collapse their export revenues. It’s not a surprise that the Argentine Central Bank is running to China to secure their Yuan swap line for their vital imports. Here’s what you must know and why Argentina’s in desperation mode.

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✅ Timestamps & Chapters:
0:00 Milei’s Running To China
2:58 Argentina’s Farm Outbreaks
6:26 Scrambling For China’s Swap Line
8:09 Sponsor: IPM Bullion
9:16 Argentina Needs Chinese Imports
10:16 Spending $300M On Fighter Jets
12:54 More Currency Devaluation Coming

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