The Argentine government has extended its 2023 national budget into 2024, reacting to the stalled approval of the new budget bill.
This extension notably broadens the National Defense Fund’s (Fondef) role, covering all capital expenses of the Defense Ministry.
Administrative Decision 5/2024 mandates that all budget allocations for capital expenditures and supplier advances within the Defense Ministry’s scope will be part of Fondef.
This update marks a shift from Fondef’s original intent, which focused on enhancing defense investment through material modernization and acquisition, separate from routine expenses.
The defense budget for 2024 stands at $2.017 billion, a decrease from 2023’s $2.927 billion, adjusted for significant inflation and devaluation.
Specific allocations include $96.1 million for the Ministry of Defense (including Fondef) and varying amounts for different military branches and defense-related entities.
Despite an allocation of $26.89 million to Fondef, this figure is lower than the suggested 0.8% of state revenues, roughly $527.6 million, intended solely for armed forces reequipment.
These numbers indicate a real reduction in the defense budget, aligning with efforts to reduce the fiscal deficit.
For decades, Argentina has seen consistent defense budget cuts.
This trend contradicts earlier campaign promises of enhancing military capabilities to align with other regional countries.
The goal was a gradual budget increase to 2% of GDP over eight years, aiming to revitalize equipment and training standards.