One of President Donald Trump‘s staunchest South American allies, Argentine President Javier Milei, has suffered a major setback at the ballot box but has vowed to press ahead with his economic program despite growing signs of an erosion of support.
Newsweek has contacted Milei’s office for comment.
Why It Matters
Trump has made no secret of his admiration for Milei, and the Argentine president was the first foreign leader to visit Mar-a-Lago after Trump won the 2024 presidential election. Milei also praised Elon Musk for his efforts to help Trump win the election, saying the tech mogul was going to “save humanity.”
Milei has implemented a series of austerity measures, including slashing energy and transport subsidies, laying off tens of thousands of government workers, freezing public infrastructure projects, and imposing wage and pension freezes below inflation.
The election setback also comes as Milei, a populist and self-declared “anarcho-capitalist,” faces a severe backlash over a growing bribery scandal involving his sister. Milei has denied any wrongdoing and has labeled the issue “the most rancid political tricks.” However, growing public frustration is evident.
What To Know
Milei suffered a sweeping setback on Sunday in a Buenos Aires provincial election widely viewed as a test for his libertarian party and a bellwether for its performance in next month’s congressional midterms.
Milei’s La Libertad Avanza party won 34 percent of the vote in Argentina’s biggest province, losing by a wide margin to the left-leaning Peronist opposition, which ended up with 47 percent, according to a count of most of the ballots on Sunday.
“We suffered a setback, and we must accept it responsibly,” Milei told supporters at his party headquarters as he acknowledged a “clear defeat.”
“If we’ve made political mistakes, we’re going to internalize them, we’re going to process them, we’re going to modify our actions,” he said, while vowing to stick to his economic program.
“There will be no retreat in government policy,” Milei added.
While his economic changes initially caused unemployment to climb, economic activity to decline and poverty to surge, his policies ultimately led to a decline in monthly inflation, which caused bonds to rally and the currency to strengthen. This has brought Argentina’s country-risk index to its lowest point in five years.
Argentina’s reserves at the central bank have also reached their highest levels in two years, bolstered by International Monetary Fund credit, and its gross domestic product has grown at rates that defied predictions from financial institutions.
However, wages remain low and prices and poverty high.
On August 27, amid the corruption scandal surrounding his sister, Milei had to leave a rally early after protesters began throwing small rocks, bottles and other objects at the pickup truck on which the president and his sister stood.
Argentina is scheduled to hold midterm elections on October 26, with half of the Chamber of Deputies and a third of the Senate up for reelection in what could be seen as a referendum on Milei’s government.
Milei must expand his party’s tiny minority in the opposition-dominated Congress in the midterms to fulfill his radical libertarian reforms and make good on his promise to turn the nine-time defaulter into a country capable of servicing its debts.
What People Are Saying
Axel Kicillof, the left-leaning governor of Buenos Aires province and one of President Javier Milei’s fiercest critics, told a rally late on Sunday: “The ballot boxes told Milei that public works cannot be halted. They explained to him that retirees cannot be beaten, that people with disabilities cannot be abandoned.”
He added: “The ballot boxes shouted that education, health care, science and culture cannot be defunded.”
What Happens Next
Argentina’s midterms are scheduled for October 26.
This article includes reporting by the Associated Press.
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