Page last updated at 06:51 GMT, Tuesday, 31 March 2009 07:51 UK

China and Argentina in $10bn deal

Argentina will be able to buy the yuan directly, without changing it to dollars

China and Argentina have made a tentative agreement to swap $10bn (£7bn) worth of their currencies.

The move, which allows both countries to bypass the US dollar, makes it easier for Argentine businesses to buy Chinese imports directly in yuan.

It also gives Argentina hard cash at a time when its finances have been hurt by the global financial crisis.

The deal comes after China suggested that the world should create a new reserve currency to replace the dollar.

The swap is being seen as a sign of China's ambitions in South America.

China primarily imports agricultural products from Argentina, while the South American nation buys Chinese electronic goods.

In the past, China has signed similar deals with South Korea, Malaysia, Belarus and Indonesia.

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