Trump threatens to cut US aid to Argentina if Milei loses election

Donald Trump has warned he could cut financial aid to Argentina if his ally Javier Milei loses crucial legislative elections later this month.

“If he loses, we are not going to be generous with Argentina,” the US president said as Milei visited the White House to seek the Republican’s political and economic support. “I’m with this man because his philosophy is correct. And he may win and he may not win – I think he’s going to win. And if he wins we are staying with him, and if he doesn’t win we are gone.”

Trump’s administration has already promised $20bn to prop up Argentina’s struggling economy but his backing has failed to calm the markets – or help Milei’s polling before midterms on 26 October.

The results of the elections, in which Milei’s minority party is hoping to boost its seat tally, will dictate whether he can pass tough cost-cutting reforms or will face a legislative brick wall for the next two years of his term.

Hailing Milei as a “great leader”, Trump said he would “fully endorse” his ideological ally in the elections. “He’s Maga all the way, it’s ‘Make Argentina Great Again,’” he added.

Trump has, however, faced questions about how a big bailout for Argentina tallies with that same “America First” policy. Asked by reporters what the benefit to the United States was, Trump replied: “We are helping a great philosophy take over a great country. We want to see it succeed.”

With Argentina struggling to stave off yet another financial crisis and Milei’s disapproval ratings rising, the country’s president has come to his rightwing ally Trump for help.

Trump has repeatedly voiced political support for Milei, while backing it up with a promise of huge economic aid, but the markets remain spooked by Argentina. In recent weeks, the highly indebted country has had to spend more than $1bn to defend the peso, a strategy most economists believe is unsustainable.

That prompted Milei’s allies in Washington to step in with a financial bailout. “Argentina faces a moment of acute illiquidity,” the US Treasury secretary, Scott Bessent, said last week, announcing a $20bn deal.

The announcement sparked a rally in Argentine bonds and stocks and helped ease pressure on the peso. It also marked a rare instance of direct US intervention in Latin American currency markets, underscoring Washington’s strategic interest in Milei’s success.

In Argentina, there has been fevered speculation about what Trump might want from Milei in return for his support. Before Milei took power, Argentina – a major lithium producer – had been deepening ties with China.

The Argentine president’s office said the leaders would discuss “multiple topics”.

Trump also threatened trade penalties, including tariffs, against Spain on Tuesday, saying he was unhappy with its refusal to raise defence spending to 5% and calling the move disrespectful to Nato.

“I’m very unhappy with Spain,” he told reporters at the White House. “They’re the only country that didn’t raise their number up to 5%. I was thinking of giving them trade punishment through tariffs because of what they did, and I think I may do that.”

Nato leaders agreed in June to raise military spending to 5%, although the Spanish prime minister, Pedro Sánchez, secured a last-minute exemption at the time, saying Spain would only spend up to 2.1%. Madrid has argued it compensates for the lower spending with strong troop contributions to Nato missions, including deployments in Latvia, Slovakia, Romania, Bulgaria and Turkey.