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Argentina: Milei's first 100 days of hope and concern

Tobias Käufer
March 18, 2024

President Javier Milei's first 100 days in office have seen Argentina grappling with rising poverty despite slowing inflation. The nation stands at a crossroads, balancing hope with growing societal tensions.

Argentina's President Javier Milei gestures while delivering his first policy speech to parliament
Argentinian President Javier Milei is a polarizing figureImage: Juan Mabromata/AFP

With poverty rising and inflation dropping, the first 100 days of Javier Milei's presidency in Argentina have given cause for hope and concern.

The Social Observatory of the Catholic University (UCA) found that poverty had risen from 45% to 57% in Argentina. And the United Nations Children's Fund (UNICEF) expects the country's child poverty rate to climb from 62% to 70%. These growing societal tensions pose an ever-greater problem for Argentina's new libertarian-conservative government under President Milei.

Inflation slows

The rise in poverty opposes the first fiscal achievements. Milei has overseen an inflation drop from around 25% in December to around 20% in January to 13.2% in February. Argentine weekly Perfil recently predicted inflation would fall by up to 7% by July.

The president said the "sharp slowdown" in inflation was "the result of the national government's work to enforce strict budgetary discipline." Even so, the current rate of 13.2% is still high for the average Argentinian.

A family searches bins for food in Buenos Aires, Argentina
Large sections of society are dealing with poverty Image: Tobias Käufer/DW

"The biggest success is pushing down inflation, which has exceeded expectations," said Carl Moses, a Buenos Aires-based economic advisor. "Argentinian shares and bonds have sharply risen in value despite the severe recession. 

"This matches the overall mood among the population, which is more positive than one would expect given the dramatic deterioration of Argentina's economic and social situation."

However, Milei hasn't been able to push through his ambitious economic reforms. Opposition in Argentina's Congress, where Milei's La Libertad Avanza party does not command a majority, and the Senate have stalled the president's reforms.

"[The country] is still lacking real reforms that would bring lasting improvements," Moses said. "The short-term balancing of public finances that the government is so proud of has been based on devaluating pensions and wages as well as other provisional measures that cannot be sustained long term."

Buenos Aires police face off with anti-Milei protesters
Buenos Aires police clash with anti-Milei protestersImage: Luciano Gonzalez/Anadolu/picture alliance

Economist Agustin Etchebarne of the Libertad y Progresso Foundation in Buenos Aires told DW that Milei's reforms need to be implemented.

"This economic adjustment and transformation process is essential to lay the foundations for sustainable growth and long-term stability," he said. "We expect the economy to recover in the second half of the year."

Major cuts

Milei's government is trying to restructure the highly indebted state budget it inherited from previous governments by implementing tough austerity measures. These include closing the deficient state news agency TELAM. In addition, Argentina's national radio station will not renew the fixed-term contracts of countless staffers. Moreover, state institutions have been shut down, and provincial governments have seen their funding cut.

Upon taking office, Milei announced Argentina's state coffers were empty and that "there is no money." Yet support for the president has been comparatively stable despite his harsh austerity measures and the country's rising poverty rate. Most recently, however, opinion polls have shown a slight dip in approval ratings. That said, Milei has benefited from warning about and delivering on his promise of a "difficult first year" — half of Argentina's population is convinced that sacrifices must be made to get the country back on track. The other half, however, is deeply worried by these developments.

Javier Milei is seen wield a chainsaw at an election rally in September 2023
Javier Milei has promised to "slash" public spendingImage: Marcos Gomez/AG La Plata/AFP

Welfare groups and the opposition are highly critical of the government's policies. The Catholic Church has focused its attention on the country's needy, with priests tending to the poor, saying a growing number of people now rely on food banks. Priest "Paco" Olveira accuses President Milei of targeting the social movements that traditionally had strong ties with previous Peronist governments.

"The government wants to destroy all community, social and political organizations." Emilio Persico of the Peronist Evita Movement thinks growing poverty in the country could bring Milei's presidency to an early end, telling DW: "It would be a miracle if Javier Milei lasts four years."

This article was translated from German.