Argentina stops printing banknotes as Milei turns to Chinese suppliers

In the midst of Javier Milei’s continued efforts to dismantle the stateattention is drawn to Casa de Moneda, the entity responsible for printing banknotes and minting legal tender coins in Argentina since 1875. The executive branch has decided to intervene in this state-owned company, which employs almost 1,300 workers, and has suspended banknote printing. In fact, the supply of banknotes now mainly comes from abroad, especially from China. “The government continues to attack our economic sovereignty,” the state union ATE criticized.

Earlier this month, the Milei government announced a restructuring of Casa de Moneda. On Monday, the Central Bank of the Republic (BCRA) terminated its contracts with the company, citing high costs, non-compliance and delays in the delivery of 1,000 and 2,000 peso notes – values that are eroded by inflation (which currently amounts to about $1 and $2 respectively). In Argentina, a country of 46 million people, it is estimated that there are almost 12 billion banknotes in circulation, many of which are losing their value and becoming increasingly obsolete, causing significant storage problems.

“All production processes related to the manufacture of banknotes will be stopped. For this reason, all personnel assigned exclusively to this production activity will be able to take advantage of all available holiday periods,” was the message received by employees following the BCRA decision.

Manuel Adorni, the spokesman for Argentina’s presidency, said the goal of the executive branch is to “make the currency more efficient.” He added: “We believe that issuing low denomination banknotes does not make sense in terms of cost-benefit analysis.” Milei’s government also decided to intervene in the company for 180 days, citing serious infrastructure deficiencies, outdated machinery and a debt of almost $400 million.

The State Workers Association (ATE), through its internal board in Casa de Moneda, criticized the Milei government for taking the company to a point of no return. The ATE argued: “The fundamental tools of an independent economy are threatened with extinction by an ideology that prefers to import banknotes from elsewhere rather than defend its own industry and sovereignty.” The Federación Gráfica Bonaerense union also accused the government a month ago of trying to dismantle the Casa de Moneda and exclude it from the BCRA banknote printing tenders.

The supply of higher denomination banknotes, especially the 10,000 and 20,000 peso notes implemented by the current government, has been entrusted to foreign suppliers. Under the previous government led by Alberto Fernandezpaper money began to be imported from Brazil, Spain, France, China and Malta in response to the demand for banknotes, driven by annual inflation that reached almost 300%.

When Milei took office last Decemberthe new authorities chose to prioritize imports, citing concerns about costs and production times. As a result, China’s state-owned Banknote Printing and Minting Corporation (CBPMC) has become the main supplier, already shipping batches of banknotes and committing to placing additional orders. The American company Crane Coin has also won a tender.

According to the government, the mint will continue to produce passports, stamps, license plates and vehicle documents for the time being. Although the government has decided to dissolve the private printing company South American Securities Company, whose assets are controlled by the mint, the future of Casa de Moneda remains uncertain. The executive must decide whether to move towards its permanent closure, seek to privatize it, or keep it within the state apparatus, albeit in a significantly reduced capacity compared to its former role.

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