President Donald Trump has made a significant statement regarding the future of Argentina’s financial aid package, linking it to the outcome of the country’s upcoming midterm elections.
Conditional Bailout
Trump’s support for Argentina’s financial aid is contingent on the success of President Javier Milei‘s party in the upcoming midterm legislative elections on October 26.
Trump expressed his support for Milei’s political philosophy and his potential victory during a meeting at the White House. However, the president made it clear that if Milei’s party does not win, the U.S. would not extend its support.
“…if he does win, we’re going to be very helpful. And if he doesn’t win, we’re not going to waste our time.”
Trump further added that if a person with a far-left philosophy, which got the country “into problem” wins the elections, “we would not be generous with Argentina.”
The comments caused a stir in the Argentine markets, which had been bolstered by the recent U.S. support package, featuring a $20 billion currency swap with Argentina’s central bank. The main stock index in Argentina, MERVAL, dipped over 2% on Tuesday, following Trump’s comments.
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Aid Package Under Fire
Trump’s decision to extend significant financial support to Argentina is notable for an American president who has previously railed against foreign interference.
The move has sparked criticism from various quarters.
Sen. Elizabeth Warren (D-Mass.) accused Trump of using the funds to help his political ally stay in power and bail out Wall Street hedge funds.
Nobel Prize-winning economist Paul Krugman accused U.S. Treasury Secretary Scott Bessent of using the aid package to bail out his “hedge fund buddies.”
Senator Chuck Grassley (R-Iowa) argued that the bailout undercuts American soybean farmers who are already struggling under the administration’s trade and tariff policies.
Price Action: Argentina-focused ETF, Global X MSCI Argentina ETF (NYSE:ARGT) declined 17.83% on a year-to-date basis while iShares MSCI Emerging Index Fund (NYSE:EEM) climbed 26.84% during the same period, as per data from Benzinga Pro.
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