US Treasury Department inks economic stabilization agreement with Central Bank of Argentina

​​​​​​By Mucahithan Avcioglu

ISTANBUL (AA) - The US Treasury Department signed an economic stabilization agreement with the Central Bank of Argentina for "a bridge to a better economic future for Argentina," Secretary Scott Bessent announced Tuesday.

"President Javier Milei’s efforts to reverse his nation’s decades of decline, stemming from the radical leftism of the Peronists are of critical importance. Argentina now has the opportunity to embrace economic freedom, and our stabilization agreement is a bridge to a better economic future for Argentina, not a bailout," Bessent wrote on the US social media company X.

Bessent noted that Milei has made a concerted effort to reverse past economic policies, including excessive spending, fiscal indiscipline and irresponsible borrowing and that the International Monetary Fund (IMF) also supports Argentina's strong economic program.

Emphasizing that the Trump administration supports Milei's current reform plans and prudent fiscal strategy, Bessent said: "We do not want another failed state in Latin America, and a strong, stable Argentina as a good neighbor is explicitly in the strategic interest of the United States."

On Oct. 9, Bessent announced that, following discussions with Argentine Economy Minister Luis Caputo, the US directly purchased Argentine pesos and completed a $20 billion swap framework with the Argentine central bank.

The bank announced Monday that it had signed an agreement with the US Treasury Department worth up to $20 billion to ensure exchange rate stability.

A statement explained that the agreement stipulates the terms and conditions for the implementation of swap transactions between the parties.​​​​​​​