Argentine President Javier Milei — an ally of Trump — is struggling to maintain public support for his massive budget cuts and austerity programs as he faces re-election, so the Trump administration is looking to add another $20 billion to help Argentina pay its debts and bolster its collapsing currency.
Some international investors have already been spooked to sell their holdings in Argentine pesos, so in response the Trump administration has begun purchasing their pesos to stabilize their value.
Also, on top of an already committed $20 billion bailout, Treasury Secretary Scott Bessent now says the United States would arrange funding commitments from banks and sovereign wealth funds to cover the second $20 billion tranche.
At a White House meeting between the two leaders Tuesday, Trump warned that the money for Argentina was dependent on Milei staying in power, despite his cutthroat economic policies and slashing of governmental “bloat” likely causing the struggles now faced by his citizens — in other words, a bribe to the voters of Argentina.
Experts say that tens of billions in investment may not fix systemic weaknesses in Argentina’s economy.
The opposition to the bailout is bipartisan.
After the first installment of financial assistance from the Trump administration, Argentina dropped export taxes on soybeans, while China has placed an embargo on American soybeans. China then purchased millions of tons of soybeans at a discount from Argentina.