Argentina is on the verge of settling its debt with China’s central bank, winding down a currency lifeline that kept the country afloat during years of financial turmoil and now sits at the centre of a geopolitical tug of war between Washington and Beijing.

Government officials confirmed to Argentine outlet Todo Noticias on Sunday that the repayment of the activated portion of the swap will be completed by mid-2026.

Central bank records published last week show Buenos Aires has repaid nearly 90 per cent of the funds it tapped from the arrangement, a mechanism that allows two central banks to lend each other their currencies in times of need. The outstanding balance fell from a peak of about US$5 billion to roughly US$675 million by mid-January, with the remainder due to mature over the coming months.

According to the central bank’s annual financial statements for 2025, released last week and reported by Infobae, Argentina still owed the equivalent of US$3.1 billion at the end of 2024.

By the end of December, that figure had been cut to US$1 billion, and by January 14, the most recent date covered by the report, it stood at US$675 million. The central bank had agreed with the People’s Bank of China in April last year to renew the full activated tranche for an additional 12 months, with a gradual reduction beginning the following June.

But the money Argentina is paying back was only a fraction of the deal. The full framework agreement, signed in 2009 and most recently renewed in August 2023 for three years, covers up to 130 billion yuan (US$19 billion).