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China extends Tajikistan $500 million swap line to keep currency afloat

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Tajikistan's soldiers march during China's military parade marking the 70th anniversary of the end of World War II in Beijing on Sept. 3.   © Reuters

ALMATY, Kazakhstan -- China signed a $500 million currency swap agreement with Tajikistan on Sept. 3 that will provide its Central Asian neighbor with much-needed cash to keep its currency afloat, a spokesperson from the National Bank of Tajikistan confirmed to the Nikkei Asian Review.

   While the agreement will come as a relief to Tajikistan, it also allows Beijing to further increase its leverage over the Tajik economy -- China is already the country's largest creditor and foreign investor -- and to deepen its footprint in Central Asia after the swap agreements signed with Kazakhstan and Mongolia in 2011 and renewed in 2014.

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