Trump to welcome Argentina's President Milei as US extends $20 billion
lifeline
[October 14, 2025]
By ISABEL DEBRE
BUENOS AIRES, Argentina (AP) — Argentina’s libertarian leader is
lavishing praise on Donald Trump ahead of his first White House meeting
with the U.S. president on Tuesday. It's a tactic that has helped
transform President Javier Milei ’s cash-strapped country into one of
the Trump administration’s closest allies.
The effusive declarations are nothing new for Milei — whose dramatic
cuts to state spending and attacks on “woke leftists” have won him a
following among U.S. conservatives.
“Your commitment to life, freedom and peace has restored hope to the
world,” Milei wrote on social media Monday, congratulating the U.S.
president on securing a ceasefire deal in Gaza, where a truce is holding
after a devastating, two-year Israel-Hamas war.
“It is an honor to consider you not only an ally in the defense of those
values, but also a dear friend and an example of leadership that
inspires all those who believe in freedom,” he said.
The Trump-Milei bromance has already paid off for Argentina — most
recently, to the tune of a $20 billion bailout.
Experts say Milei comes to the White House with two clear objectives.
One is to negotiate U.S. tariff exemptions or reductions for Argentine
products.
The other is to see how the United States will implement a $20 billion
currency swap line to prop up Argentina’s peso and replenish its
depleted foreign currency reserves ahead of crucial midterm elections
later this month.
In a crisis, turning to Trump
The Trump administration made a highly unusual decision to intervene in
Argentina’s currency market after Milei's party suffered a landslide
loss in a local election last month.
Along with setbacks in the opposition-dominated Congress, the party's
crushing defeat created a crisis of confidence as voters in Buenos Aires
Province registered their frustration with rising unemployment,
contracting economic activity and brewing corruption scandals.
Alarmed that this could herald the end of popular support for Milei's
free-market program, investors dumped Argentine bonds and sold off the
peso.
Argentina’s Treasury began hemorrhaging precious dollar reserves at a
feverish pace, trying shore up the currency and keep its exchange rate
within the trading band set as part of the country’s recent $20 billion
deal with the International Monetary Fund.
But as the peso continued to slide, Milei grew desperate.
He met with Trump on Sept. 23 while in New York City for the United
Nations General Assembly. A flurry of back-slapping, hand-shaking and
mutual flattery between the two quickly gave way to U.S. Treasury
Secretary Scott Bessent publicly promising Argentina a lifeline of $20
billion.
Markets cheered, and investors breathed a sigh of relief.
Timing is everything
In the days that followed, Argentine Economy Minister Luis Caputo spent
hours in meetings in Washington trying to seal the deal.
Reassurance came last Thursday, when Bessent announced that the U.S.
would allow Argentina to exchange up to $20 billion worth of pesos for
an equal sum in dollars. Saying that the success of Milei’s program was
“of systemic importance,” Bessent added that the U.S. Treasury directly
purchased an unspecified amount of pesos.
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For the Trump administration, the timing was awkward as it struggles to
manage the optics of bailing out a nine-time serial defaulter in the
middle of a U.S. government shutdown that has led to mass layoffs.
But for Argentina, it came in the nick of time.
Aware of how a weak currency could threaten his flagship achievement of
taming inflation and hurt his popularity, Milei hopes to stave off what
many economists see as an inescapable currency devaluation until after
the the Oct. 26 midterm elections.
A devaluation of the peso would likely fuel a resurgence in inflation.
“Milei is going to the U.S. in a moment of desperation now," said
Marcelo J. García, political analyst and Director for the Americas at
the Horizon Engage political risk consultancy firm.
“He needs to recreate market expectations and show that his program can
be sustainable,” García added. "The government is trying to win some
time to make it to the midterms without major course corrections, like
devaluing or floating the peso."
No strings attached
Milei was vague when pressed for details on his talks with Trump,
expected later on Tuesday. Officials say he would have a two-hour
meeting with the U.S. president, followed by a working lunch with other
top officials.
He was also expected to participate in a ceremony at the White House
honoring Charlie Kirk, the prominent right-wing political activist who
was fatally shot last month. Milei often crossed paths with Kirk on the
speaking circuit of the ascendant global right.
“We don’t have a single-issue agenda, but rather a multi-issue agenda,”
Milei told El Observador radio in Buenos Aires Monday. “Things that are
already finalized will be announced, and things that still need to be
finalized will remain pending.”
It’s not clear what strings, if any, the Trump administration has
attached to the currency swap deal, which Democratic lawmakers and other
critics have slammed as an example of Trump rewarding loyalists at the
expense of American taxpayers.
There has been no word on how Argentina, the IMF's largest debtor, will
end up paying the U.S. back for this $20 billion, which comes on top of
IMF’s own loan for the same amount in April. And that one came on top of
an earlier IMF loan for $40 billion.
Despite all the help, Milei's government already missed the IMF's early
targets for rebuilding currency reserves.
"The U.S. should be concerned that Argentina has had to return for $20
billion so quickly after getting $14 billion upfront from the IMF,” said
Brad Setser, a former Treasury official now at the Council on Foreign
Relations.
“I worry that this may prove to just be a short-term bridge and won’t
leave Argentina better equipped” to tackle its problems, he added.
But in the radio interview before his flight, Milei was upbeat. He
gushed about U.S. support saving Argentina from “the local franchise of
21st-century socialism” and waxed poetic about Argentina's economic
potential.
“There will be an avalanche of dollars,” Milei said. “We’ll have dollars
pouring out of our ears.”
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