Trump dangles $20 billion lifeline for Argentina, with strings attached

President Donald Trump speaks during a meeting with President Javier Milei of Argentina at the White House in Washington, on Tuesday, Oct. 14, 2025. Milei’s visit comes after the Trump administration agreed to provide Argentina a $20 billion lifeline. (Doug Mills/The New York Times)

By ZOLAN KANNO-YOUNGS and ALAN RAPPEPORT

President Donald Trump said earlier this week that Washington’s $20 billion bailout for Argentina comes with strings attached — namely, that the ruling party of his ally, Argentine President Javier Milei, must prevail in the country’s legislative elections this month.

“If he loses, we are not going to be generous with Argentina,” Trump told reporters at the White House, where he was meeting with Milei. Just minutes earlier, Trump had denied the economic lifeline was meant to help Milei’s party in the elections.

“I think he’s going to win,” Trump added. “And if he wins, we’re staying with him, and if he doesn’t win, we’re gone.”

Trump’s comments made clear that he viewed the financial support for Argentina as a lifeline not just for the country’s economy, but also for a leader willing to spread his pro-capitalist — and pro-Trump — ideology in Latin America.

“Just helping a great philosophy take over a great country,” Trump said, adding that financial success of Argentina would be a “great feather in the cap of the USA.”

Trump’s bailout of Argentina has come with political blowback at home. Democrats have seized on the bailout to accuse Trump of helping out a foreign government and wealthy investors while the U.S. government remains shut down because of a dispute over extending health care subsidies.

Major hedge funds, including those led by friends of Treasury Secretary Scott Bessent, could benefit financially from the bailout. Funds at investment firms including BlackRock, Fidelity and Pimco are heavily invested in Argentina, as are investors who worked with Bessent when he was an investor for George Soros.

“President Trump seems to think it’s more important to offer $20 billion to bail out Argentina than it is to make a bipartisan deal to prevent health insurance premiums from spiking for over 20 million Americans in a matter of days,” Sen. Jeanne Shaheen, D-N.H., the top Democrat on the Foreign Relations Committee, said in a statement.

American farmers have also criticized the move, given that China has been buying soybeans from Argentine farmers instead of American growers this year. Trump said Tuesday that he believed China was trying to drive a wedge between the United States and Argentina by buying soybeans from Latin America.

Bessent has defended the administration’s economic support for Argentina, arguing that it could help stabilize the Western Hemisphere and that it is an investment that U.S. business leaders have sought to deepen ties with Argentina. He added that providing U.S. support to Milei’s opponents, who are not willing to enact a suite of economic changes, would be a waste of money.

The face-to-face meeting between Trump and Milei comes after the Trump administration agreed to provide Argentina a $20 billion lifeline that would come in the form of a currency swap with the nation’s central bank. The details of the bailout remain unclear, but it could provide a political boost for Milei, who is hoping to stave off a financial crisis and a political disaster for his party.

The conditioning of the U.S. support on the electoral success of a political ally, rather than strictly the risk of a financial collapse that could hurt an economic partner, was highly unusual, according to economists.

Barry Eichengreen, an economist at the University of California, Berkeley, said the Clinton administration had stepped in to help Mexico avoid a financial crisis, but the motivation then was to help stabilize the economy of a trading partner. When that administration provided an emergency loan to South Korea in 1998, it was meant to prevent the collapse of a financial system, not to influence the outcome of an election.

“In both cases, there was a significant risk of financial contagion to other countries, which is not the case of Argentina today,” Eichengreen said. “In both cases, the U.S. was significantly exposed to instability in the subject country either economically or financially. Neither condition applies today in Argentina.”

In Argentina, however, Trump has found a leader that amounts to a political kindred spirit. He has described the Argentine leader as his “favorite president,” and Milei was one of only two world leaders onstage at Trump’s inauguration.

A government bailout would typically be handled through the International Monetary Fund, which would establish a framework for the nation in financial duress. The IMF has provided Argentina with more than 20 economic support packages since the 1950s, including as recently as this April. However, its economy has continued to lurch from crisis to crisis.