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The Trump administration is in talks for a “private-sector solution” that would funnel $20 billion toward Argentina’s “upcoming debt payments,” Treasury Secretary Scott Bessent told reporters Wednesday.
Officials have worked “for weeks” on the new opportunity to help Argentina, Bessent said, adding that private banks and sovereign wealth funds have already expressed interest. It comes as the US also prepares to swap $20 billion of its stable dollars for volatile Argentinian pesos.
“We are working on a $20 billion facility that would be adjacent to our [currency] swap line,” Bessent said, adding that some US currency was exchanged earlier Wednesday. “So that would be a total of $40 billion for Argentina.”
The Trump administration is seeking to steady the Argentinian economy before voters decide on Oct. 26 whether to hand more power to the party of President Javier Milei, a Trump ally who has pursued a cost-cutting agenda. After Trump said this week that officials would not “waste our time” if Milei’s party suffers losses, Bessent on Wednesday clarified that the aid “is not election-specific, it is policy-specific.”
“We think of it as … an economic Monroe Doctrine in terms of the Western Hemisphere” rather than a way to stop economic instability from spreading to the US, Bessent said later.
“The governments had swung from left to right, and then, through neglect, they swung back hard left again, where many of them are now — but now they’re coming back the other way,” he added.
“We’re seeing that we’re having to intervene militarily with the narcotraffic coming out of Venezuela,” Bessent said, referring to Trump’s military strikes on alleged drug boats. “Much better to use the heft of the US economic power rather than have to use military power.”
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Democrats were quick to criticize the additional $20 billion, which comes during a government shutdown with no end in sight.
Their party has refused to support the GOP’s short-term spending bill until Republicans address enhanced health care subsidies that will lapse at the end of the year.
“This is an Argentina bailout that puts Argentina ahead of American farmers, American people who are looking for health care, and America’s economic interests overall,” Sen. Elizabeth Warren, the top Democrat on the Senate Banking Committee, told Semafor. “Evidently, Donald Trump no longer believes it’s America First; he’s all in for Argentina First.”
Warren pointed to the US hedge funds that stand to benefit from the push: “It helps out Treasury Secretary Bessent’s best buddies from Wall Street.”
Republicans said they’d need to learn more before weighing in on the latest announcement: “I don’t know enough about it to even have an opinion,” Sen. Cynthia Lummis, R-Wyo., told Semafor.
But she added that she was “glad to see us looking at South and Central America in ways that we can avoid those kinds of wild economic swings that actually destabilize the globe.”
“I think that, for a while, people assumed that we were giving a freebie to Argentina, and trying to juxtapose that against some employee layoffs here and things like that,” Lummis said. “But it’s not that simple.”
Notable
- Bloomberg’s Odd Lots podcast on Wednesday hosted author Gregory Makoff for an explanation of how Argentina wound up here.
- At another Wednesday press conference, Bessent suggested the US could further delay its tariffs if China agrees to delay its rare earth controls.