LA PAZ, (Reuters) – Bolivia’s president expressed openness to the use of the Chinese yuan for international trade during a press conference, citing similar moves by Argentina and Brazil to tap the Asian currency for transactions with China.
International trade transactions tend to be priced in U.S. dollars, especially for major commodity markets like energy and grains, going back decades.
“The two largest economies in the region are already trading in yuan in agreements with China, and that is going to be the trend in the region,” Arce said, adding the South American country could not afford to stay on the sidelines.
The Argentine government announced last month it will start to pay for Chinese imports in yuan rather than U.S. dollars, in large part to safeguard the central bank’s dwindling dollar reserves needed to pay down debt as well as to finance imports.
Earlier in the year, China and Brazil moved to reduce the dominance of the greenback by signing a deal to set up yuan clearing arrangements that can facilitate bilateral trade.
“In Latin America, we have always had a great influence from the United States… but today many countries have more foreign trade with China. Things are changing,” said Arce.