Argentina has repaid the funds it drew from a $20 billion U.S. credit line, Treasury Secretary Scott Bessent announced Friday, marking what he described as a landmark vindication of the Trump administration’s financial rescue of President Javier Milei’s government. The Argentine Central Bank confirmed the repayment. The U.S. Exchange Stabilization Fund, tapped to fund the bailout, now holds no Argentine pesos, Bessent said.
The repayment clears a significant credibility test for Milei’s radical austerity program, but Argentina’s foreign exchange reserves remain perilously low and the country faces further strain from International Monetary Fund loan repayments and private debt obligations in the months ahead.
Repayment and U.S. Profit Claim
Bessent did not specify the amount Argentina repaid. The Treasury’s latest report on the credit line said Argentina’s central bank had traded pesos for $2.5 billion through the currency swap as of the end of October.
Bessent praised the outcome in a written statement. “Stabilizing a strong American ally — and making tens of millions in profit for Americans — is an America First homerun deal,” he wrote. “Setting the course for Latin America, a strong and stable Argentina that helps anchor a prosperous Western Hemisphere is in our clear best interest.”
Argentine Economy Minister Luis Caputo thanked the Trump administration “for the trust in our economic policy.” “It is an excellent reality for our country to have been able to build this geopolitical alliance and to know that we have the explicit support of the most important country in the world,” Caputo said.
Context: A Contentious Rescue
The credit line, described by the Associated Press as contentious and largely unprecedented, provided dollar liquidity to one of the Trump administration’s closest ideological allies at a moment when Argentina’s markets were under acute pressure ahead of crucial midterm elections last October.
Critics raised doubts about the rescue’s consistency with Trump’s “America First” foreign policy and objected to placing U.S. taxpayer funds at risk. Experts also criticized the opaque and apparently unconditional nature of the loan.
Milei’s libertarian party won a major victory in the October midterms, cementing support for his harsh austerity program and easing investor concerns about Argentina’s capacity to repay its debts. Argentina also issued a dollar bond for the first time in eight years last month, signaling a tentative return to international bond markets.
Risks Remain
Despite the repayment milestone, Argentina is not without ongoing vulnerabilities. The country’s foreign exchange reserves remain perilously low, and it faces additional pressure in coming months from repayments on previous IMF loans and other private debt.