”Sleep, sleep negrito 
That your mama is in the fields 
Negrito
She’s going to bring quails for you
She’s going to bring lots of things for you
She’s going to bring pork meat for you
She’s going to bring lots of things for you
And if negro doesn’t sleep
White devil comes
And Zap! He’ll eat your little leg
Yakapumba Yakapumba
Apumba Yakapumba Yakapumba Yakapumba…”
Duerme negrito, Popular Song

Negro Che is the title of a documentary that tells the story of black people in Argentina, but the other way around, “Che, negro!” is a common way in which people call each other in the same country (something like “hey, bro!” or “hey, dude!” here in the US)
You don’t really need to be black to be called negro/a or negrito/a (black) by your friends and in many cases it’s not an insult, it is more like a term of affection. But in some contexts being called a “negro” IT IS an insult and a synonym of uneducated, low class, dirty, poor. 
Argentina is the only country I know where an insult can instantly became a nickname, and sometimes a term of friendship. For example “boludo” (having big testicles) can mean guy or idiot at the same time! If you are not from Argentina, avoid any of these terms since you can get in trouble if you don’t know exactly how to use them…
There is another derogatory term in Argentina that comes from a while ago, "cabecita negra" (little black head). It was used to call people with native ancestors and lately to those who came from outside the capital Buenos Aires, and arrived to the big city searching for a better life.
The term originally comes from the common name of a bird, the Carduelis Magellanica or Cabecita Negra (Hooded Siskin in English). Those arriving to the city usually had black hair and dark skin were being called cabecitas negras, cabecitas, cabezas, negros, morochos, and later grones, and gronchos.
Those living in Argentina tend to say proudly that there is no racism there because “we have no black people living here”, both affirmations being not true at all. Many Argentineans still considered themselves white pure descendants of European migrants even when the history of the country tells the contrary.
And of course the sentence “we have no black people in Argentina” expresses in itself the racism predominant in the country.
I’ve been called negra by friends and family, and practically everyone I know from Argentina has been called at some point in that way, both in friendly and insulting ways. I know, it’s a puzzle for those outside of the culture… 
Do I think it’s OK?
Well, I don’t like much nicknames in general, and prefer to call people by their names, specially when the nickname can be misunderstood. And I’m not sure I would like others calling my Ethiopian kids by “che, negro!”… Mmm, I guess not.
But I also don’t think I will be able to avoid the name calling when we get the chance to travel to Argentina, so we will have to put up with it…
People can be very rude when talking to you, even hurtful and it’s useless to start an argument many times a day when you know that they “don’t get it”.
But there are sweet and sad ways at the same time to call someone negro, for example here is the video of the song “Duerme Negrito”, in the version of the “negra” Mercedes Sosa:

AliciA